CEOInterviews.AI#307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation

L

Lex Fridman0:00

The following is a conversation with Brian Armstrong, co-founder and CEO of Coinbase, the largest cryptocurrency exchange platform with 98 million users in 100 countries. I recorded this conversation before this week's SEC probe into whether some crypto listings are securities. Our world runs on money, and cryptocurrency seeks to build the next chapter of how money works. Coinbase and Brian are trying to do this by working with regulators. Bureaucracies resist change. The latest SEC probe is a serious attempt to limit fraud but also risks limiting innovation. Decentralization is a hedge against centralized power. Now, a quick mention of sponsors: Audible for audiobooks, Skiff for email, BiOptimizers for health, Fundrise for investing, and Athletic Greens for performance. And now, dear friends, here's Brian Armstrong.

Let's start with the fact that you're a programmer. What was the first program you've ever written? Or the first one you remember?

B

Brian Armstrong8:25

The first memory I have of programming was probably in middle school. I remember it was recess, and they had this time period where you could read books. The other kids were reading comic books, but for some reason I had gotten into this idea that I wanted to get into computers. I was playing with computers at home. So I got this book from the library called 'How to Learn Java in 30 Days'. I was reading this book at recess, and I didn't understand anything. I remember I went home and tried to get this thing working. If you've ever written a Java program, the first lines are like 'public static void main string args' and it's so foreign and difficult to get started. I was frustrated. I didn't understand anything. So the first thing I wrote was probably just a hello world app in Java. But I felt so confused about what was happening that I later learned a bit of PHP. PHP was more fun for me because it was like 'Oh, just print out what you want.' It didn't have all this complexity. So I got more into PHP and started building simple websites. I learned some HTML. That was my introduction to programming.

L

Lex Fridman9:43

Yeah. You know, Java has a lot of out of all the Hello Worlds you can possibly write, Java is the one where I think it's the longest. Which is quite interesting because Java is often, at least for a long time, was used as the primary programming language to teach people how to program, or at least about object-oriented programming. I think most universities have now switched and high school switched to Python.

B

Brian Armstrong10:07

Mhm.

L

Lex Fridman10:07

I'm not sure if that's the case.

B

Brian Armstrong10:08

Probably better. It's easier to learn. It lowers the makes it less scary.

L

Lex Fridman10:13

And certainly none of them use PHP. I love PHP and I feel like it's a dirty secret I have to keep private to myself, like it's somebody I'm seeing on the side or something like that, because it's just not a respected programming language because I think there's so many ways you can write poor code with PHP.

B

Brian Armstrong10:30

Yeah.

L

Lex Fridman10:30

Which is why it's not respected.

B

Brian Armstrong10:32

Yeah, it's a scripting language more so, although I of course Facebook built like a huge stack on top of it, a valuable company. But I still love Ruby to this day. Ruby's probably my favorite language. Python's great, too, but I just love the idea behind Ruby that it's like, let's make it easier for the human, harder for the computer, and make it a joy to be expressive. So, I was never the best computer scientist, but I was a good hacker. I could rapidly prototype products using languages like Ruby. Do a lot of computer science programs still use like Lisp and Scheme and things like that?

L

Lex Fridman11:05

No. No, they do for That's like if you're hardcore. If you're legit, you're going to do some of the functional languages. I think there's a few others that popped up, but Lisp is a distant memory for a lot of people. That's like somebody has to like you go to a library you dust off the book. But Scheme a little bit. I think if you're starting there are courses about programming languages. Lisp might be one of those. You know how there are languages that nobody uses anymore? Like ancient languages. You might have to go to school in that same way for programming languages. Back in the day we used to use parentheses. I of course still use Emacs as the editor for most things that I do. And Emacs is you know a lot of the customization you can do is in Lisp. And that's the language probably when I first really fell in love with programming is Lisp. Because for a long time throughout the earlier history of artificial intelligence Lisp was the primary language, but it still had a life in the 90s and the aughts where some people would use it. Such a beautiful functional language, but it just somehow didn't pick up. That said, I should say push back. PHP I feel like it's still true that most of the web runs on PHP. Most of the back end is still PHP. So if you look at it's like the stuff that people don't talk about. It's what runs most systems in the world? What runs the most back end? What runs most front end? JavaScript you know HTML.

B

Brian Armstrong12:42

Yeah.

L

Lex Fridman12:42

JavaScript I think the Stack Exchange surveys show JavaScript is the most popular language in the world I think, right?

B

Brian Armstrong12:45

Oh yeah. In terms of programmers and numbers of I wonder.

L

Lex Fridman12:50

By survey of number of programmers on Stack Overflow.

B

Brian Armstrong12:58

Oh yeah, but those are also the cutting edge, right? Those are the people that are just excitedly writing code. I wonder if there are people that are just maintaining gigantic code bases.

L

Lex Fridman13:11

I feel like the amount of Java out there just running industrial systems has got to be enormous. And then of course in the banking industry finance it's like even older stuff COBOL and whatnot.

B

Brian Armstrong13:22

I've been actually looking for somebody to interview who represents COBOL and Fortran, like who's the figure still holding the flag. I did, you know, with Java, founder of Java, creator of Java, creator of Python, creator of C++, but nobody wants to hold the flag for COBOL and Fortran, even though some of the most important systems in the world still run on those.

L

Lex Fridman13:49

Yeah. Uh, like power systems and infrastructure systems, which is fascinating. And ATMs and stuff like that. Like a lot of stuff that we rely on, that just works. And the reason we don't change it because it works well. Is written in language that people don't use anymore.

B

Brian Armstrong14:06

Yeah.

L

Lex Fridman14:08

That'd be a cool series of interviews. Get the stuff that's like tech that was invented 40, 50 years ago, but still is being used widely. I mean, Emacs is an example of that.

Let me ask the big question of, what are cryptocurrency exchanges and what's Coinbase? How does it work? Before I'll ask even bigger questions, but it's just a nice kind of palate cleansing question of what is Coinbase?

B

Brian Armstrong14:32

Coinbase is a cryptocurrency exchange, brokerage, custodian. Basically, we're the primary financial account for people in the crypto economy. How they buy crypto, how they store it, how they use it increasingly in different ways. We can talk about that. So yeah, we want to be the way that a billion people hopefully access the open financial system globally.

L

Lex Fridman14:53

How does it work? What, uh, what's cryptocurrency? You know, there's Bitcoin, there's Ethereum. What does it mean to be an exchange? What does it mean to store? What does it mean to transact? How does it What does Coinbase actually do?

B

Brian Armstrong15:13

Okay, so, you know, basically in any given market, there's some people who want to buy, some people who want to sell, and you keep an order book of all those prices. And then, if someone's willing to buy for more than the lowest price someone's willing to sell, then you get a trade to execute. That's kind of how an exchange works underneath. And a brokerage is kind of simpler than that even. You don't have to look at the whole order book, but you just go in and say, 'I want to buy $100 of Bitcoin or whatever cryptocurrency.' You get a quote, and if you like it, you can hit accept. The core things we do to make that seamless is we have to do payment integrations around the world to make it easy for people to get fiat currency into this ecosystem. We have to work on cybersecurity a lot. There's lots of hackers trying to break into our systems. We have to integrate with the blockchains themselves, which are periodically updated. And then we have to store the crypto that people buy securely. Crypto is like storing private keys. We've invented a lot of cool technology about how to do that securely. So those are some of the pieces that had to come together to get that early buy-sell experience to work. Coinbase actually has a lot of different products now. We have an institutional product, Coinbase Commerce for merchant payments, a self-custodial wallet, and we just launched an NFT product. So we're sort of like a portfolio of crypto products now. But the core thing we got started with and still the majority of our revenue is people just want to come in and buy and sell some crypto.

L

Lex Fridman15:20

I'll ask you about wallet and NFTs about what is it called the stripe type?

B

Brian Armstrong15:22

Oh yeah, Coinbase Commerce.

L

Lex Fridman15:24

Coinbase Commerce.

B

Brian Armstrong15:26

Yeah.

L

Lex Fridman15:27

I'll ask you about all that. But order books and exchange, what's the difference between that and stocks for example which there is also order books.

B

Brian Armstrong15:31

Yes, I mean stocks trade through order books, too. So do commodities.

L

Lex Fridman15:39

So it's all similar type of situation. So when I want to buy one Bitcoin and I see Coinbase say the price of that Bitcoin is say $40,000. And I press buy, what happens?

B

Brian Armstrong15:54

Um yeah, okay. So you've gotten a quote. (laughter) Like, you know, when you press the button on your keyboard like an electrical signal goes up the wire. Now we won't get into that level. That's also important the timing, right? Because there's not price fixed. Yeah, that's true. It's giving you a quote. There's a whole concept of slippage. By the time the quote is executed, if the price has moved too much, we may reject it. But the simple version is we'll check the order book, give you a quote. It's good for some period of time or for some amount of slippage. Then we're initiating a debit to your payment method, whether credit card or bank account or stored dollars. We're debiting that and crediting you the crypto, and we're taking a fee for it. That's fundamentally what's happening underneath.

L

Lex Fridman16:54

And then there's just some interesting slippage. How do you calculate the how much slippage is allowed? Like how do you know these things? Because order books are fascinating, the dynamics of that is pretty interesting.

B

Brian Armstrong17:10

Yeah, so there's a lot of people like traders who get super into this and high-frequency traders and arbitrage and all kinds of interesting topics. Flash Boys was like an interesting book on this whole thing. You want access to information the fastest, sometimes even putting your thing in the data center right next to the thing. We don't allow that colo stuff because we want it to be more democratized. But basically you give a let's say we wanted to keep it math simple. We want to charge a 1% fee. So if you're buying $100 of Bitcoin, we'll charge you $101. We've presented you the amount of Bitcoin you're going to get for the $100. Now, let's say 10 seconds later you hit accept. We go to fill the order. So it's going to be some error bound around that 1% fee. And if we think we're actually losing money on the trade, we'll often reject it. So some part of the fee the slippage is incorporated into that. Averaged over a large number of people. It's fascinating because even that little detail probably requires a lot of experimentation.

L

Lex Fridman18:11

But so, how do you protect against that? How do you protect? We'll talk about cybersecurity in interesting ways, but there's a lot of clever people trying to do clever things to earn an edge. How do you stay one step ahead?

B

Brian Armstrong18:14

Yeah, and it's kind of like a giant bug bounty out there because if you get it wrong, there's people who are going to arbitrage that. And we've had people sort of pen test our systems in really creative ways where they'll just fire programmatically with APIs, they'll fire off a million different quotes and look for one that's out of bounds and then take that money. And we get people doing all kinds of crazy stuff.

There's no silver bullet. It's a bunch of lead bullets, right? So, it's like, one thing we do is we just have good test suites. You're testing every piece of code that goes out. That's just common good best practice, but it's particularly important in financial services. Another thing we do is we hire third-party firms to try to audit this stuff and break in. Another one we do is we have a bug bounty program. We basically pay white hat hackers to find this stuff before the black hats do. And we've paid out lots of good bug bounties. So, try all the above. And occasionally you don't get it right and you lose some money and then you fix it and you keep going.

L

Lex Fridman19:37

Let's talk about cybersecurity a little bit more. You mentioned using stolen bank accounts. So, that's another one. That's another interesting one. How do you protect against that?

B

Brian Armstrong19:47

Okay, so fraud prevention yeah, is a big topic. So, one of the things people do is that you use machine learning. You look at, to protect against it. What you want to do is kind of build up a labeled data set of all the different people who have turned out to be fraudulent and good actors and hopefully collect as much data as you can. Then you'll feed hundreds or thousands of these factors into your machine learning model and it'll come back with a risk score. An example of the kinds of factors people create is, obviously I don't want to disclose too many because it's a cat and mouse game, but relatively well-known stuff might be device fingerprints. What kind of device are you on and what fonts do you have installed? A lot of people who are farming lots of these accounts, they're using emulators and virtual machines. They're not like an average person on that device. One of my favorite metrics we tracked was called improbable travel velocity. We would track people's IPs. You might see someone who was one day in Austin, Texas and then like an hour later they were in London. That's very improbable. Sometimes people are using VPNs, so you got to be careful because legitimate people use VPNs too, but if it's not possible for them to have gotten on a plane and gotten there that quickly, then they're usually spoofing a device or IP. Another fun one is real users will type their credit card one number at a time. Scammers have a list and they'll paste in a whole number. So you can look at the number of milliseconds between keystrokes. There's all kinds of stuff people have come up with.

L

Lex Fridman21:43

And even for travel velocity, you could probably incorporate VPNs, too, because there's probably a travel velocity for VPN switching, too. That's human-like. If you're using legitimately VPN for something else, that might be There's like legitimate uses to. Actually, you know, I feel embarrassed that I don't know this. Probably should. But the I'm not a robot captcha thing? So, that probably works in the same way. Like how do you move your mouse, maybe? Or how the dynamics of the clicking? But how does that even work that well then? And why can't it be faked? I need to look into this because it's a trivial captcha. It feels like should be very crackable and yet a lot of high security places use that. It's really interesting.

B

Brian Armstrong22:32

Yeah. It's another cat and mouse game. I think they've Yeah, but it's using a lot of similar signals like mouse movements, keystrokes, and then obviously all the stuff that comes over the wire with your browser. So, like what operating system, what fonts, what headers are being sent over. There's actually an old website, I can't remember what it was called, kind of like Panopticlick or Panopticon, but it was a proof of concept that they would just show you all the data that was getting sent over with your request and say that there's only one person in the world who has this exact set of data. It's you. So it's almost like a clever workaround to track somebody even if there wasn't a cookie involved.

L

Lex Fridman23:18

Yeah, this is a fascinating world. We can't see anybody. You're in the dark and yet you have a lot of signal you have to figure out who's a real person who's not, who's a robot who's not. Let me step back. We're going to jump around all over the place. Let me step back.

B

Brian Armstrong23:31

Like your interviews. You get into technical topics.

L

Lex Fridman23:34

So let's just use Bitcoin as a measure of time. You started Coinbase when Bitcoin was $10. And you just mentioned an incredible system with security, with transactions, everything is thought through. There's a lot going on, but what was version one? Back in those early days, the first prototype of Coinbase, what did that look like? Like what did it take to write it, to think through it, and make it work enough to at least make you believe that it's going to work?

B

Brian Armstrong23:58

Well, I definitely didn't know if it was going to work. I mean, it was kind of I felt like I was just following my gut. I was working at Airbnb, I was a software engineer there, project manager. I was working on some fraud prevention stuff. And I read the Bitcoin white paper in December of 2010. I started going to some Bitcoin meetups in the Bay Area. Met lots of interesting people there, crazy people, anarchists, really brilliant people, all the above. So I started nights and weekends trying to hack together a prototype. My initial thought was, SMTP is a protocol that runs email. Git is a protocol for version control. But people made Gmail and GitHub. Most people don't want to run their own email server or Git server. They just want a hosted thing that does all the security and backups for them. So the thought in my head was Bitcoin is this new protocol. There's probably going to be somebody who makes a hosted service that does all the security and backups for you and makes Bitcoin easy to use. So maybe I should make a hosted Bitcoin wallet or something. I was going to make Gmail for Bitcoin. A bunch of people told me it was a bad idea. Most of my smart friends said they didn't get what I was doing, Bitcoin sounded like a scam. Other people who understood Bitcoin told me it was dumb because if I stored all that Bitcoin I would just get hacked. So I thought, I'm not going to go all in and store everyone's Bitcoin. That would be too much right now. I have a day job. But let me just make a prototype and tell people this is a beta, don't put any real money in it, and see if there's interest. If I felt I was onto something, maybe I would go do this as a company. I really wanted to be an entrepreneur. I was 29, almost turning 30. I always wanted to start a company but I was an employee. So I had this prototype I was hacking together nights and weekends. I actually wrote a whole Bitcoin node in Ruby, which turned out to be a weird decision in hindsight because Ruby wasn't the most performant language. We've subsequently had to rebuild that many times. I had this hosted Bitcoin wallet, but I didn't have any users for it. I applied to Y Combinator because maybe if somebody there writes me a check, it will make it feel like a real company. I was trying to find a co-founder unsuccessfully. I was basically wandering in the desert. I had a lot of self-doubt because all my friends thought it was dumb and maybe Bitcoin would get shut down. There was definitely a feeling of wandering lost in the desert. Paul Graham and the Y Combinator group wrote me the first check after I interviewed. They wrote me a check for $150k. That was the first time somebody I really looked up to said this is worth pursuing. That gave me the confidence to quit my job and try it. I found the right co-founder after Y Combinator. We still didn't have any customers. I launched the hosted Bitcoin wallet. People were signing up, maybe 100 people would sign up and then nobody would come back. In Y Combinator they often tell you to talk to your customers and improve your product. So I emailed five of the users that had signed up and asked why they didn't come back. One guy said the app was okay for a beta but he didn't have any Bitcoin, so he didn't know what to do with it. I had a light bulb moment. I asked if I put a buy Bitcoin button in there, would you have used it? He said yeah, maybe. So we went about the process of getting a bank partnership, payment rails, an exchange, basic exchange functionality. The minute we launched that feature where you could just click buy, put in your bank account or credit card, buy Bitcoin, it showed up in your account. From that day forward the number of users started to go up. We finally had found product market fit after two years of wandering in the desert.

L

Lex Fridman28:47

So you weren't even thinking about the buy the on-ramps. You were thinking it would be just the wallet, a place to store Bitcoin that you've already gotten. Okay. That's such a pain to do to have to work with others to convert dollars of any fiat currency into Bitcoin. So did you were you overwhelmed by the immensity of the task here or were you sort of not allowing yourself to think too deeply through this whole thing and just letting the optimism take over here?

B

Brian Armstrong29:28

You know, I was really looking forward to doing something crazy and a big challenge. I love kind of crisis moments like that where I'm very determined, especially when I get set on something and I'm just like, you know what? I'm going to figure out a way to make this thing work no matter what. So I reveled in that. I had read all these books about startups and every startup has major setbacks and nothing works. So I had no idea if I was doing anything right at all, but I was kind of loving the experience of it in a weird way. It felt stressful at the time, but I felt like I was on the right path somehow. I just kept going.

L

Lex Fridman30:19

What was the darkest moment that you've gone to in your mind during that time? What were some of the tougher moments? You said self-doubt. Have you where did you go in your mind? Is there a moment where you're just laying there, this is hopeless?

B

Brian Armstrong30:43

Well, there's a couple moments I'm remembering. For whatever reason, I had this big chip on my shoulder. I really wanted to do something important in the world. I could have a good life and work for some good companies and write software, but for some reason I never wanted that for myself. That probably would have been healthier. But I was willing to sacrifice a lot for that. I remember one of the darker moments was when we probably had maybe five employees. A bunch of bad things happened all at once. First of all, we were all sleep deprived, which exacerbates everything. The site would go offline in the middle of the night and I'd get paged, sometimes two or three times a night. So in that environment, you can get discouraged. One bad thing was we had a bug on the website and thousands of people on Reddit and Twitter were pissed at Coinbase because balances were showing wrong. They were saying, this company is over. I'd never had this feeling of a thousand people mad at me at the same time. I'm a pretty chill guy, most people don't get mad at me.

L

Lex Fridman32:33

Can we pause on that? That's so interesting. So you were saying here's a dream, I'm trying to create something, and now forever the reputation of this dream is ruined. It will never be recoverable. It's over. That kind of feeling.

B

Brian Armstrong32:45

Yeah. Well, I didn't know at that time. I was like, is this the end? Everybody hates us. So is it over? Nobody told me before starting a company that a bunch of people will hate you for this. That's very counterintuitive because most companies are trying to do good things in the world. Even if someone is trying but failing, I'm generally rooting for them. But that's not the case at all. Most founders I've known have gone through this too. They're very surprised at the amount of hate they get. I think it's actually a muscle you can build, your tolerance to it. Because you feel terrible at the center of the storm, but then you go talk to your family and they have no idea about the negative press. They're busy in their own life.

L

Lex Fridman33:46

Can I once again linger on that? There's an interesting person I'd like to bring up just as an example. Bill Gates. He gets a very large amount of hate on the internet. And there's something about him, this is me talking, not you, that he seems out of touch about that hate. I believe, at least in my understanding, that with the resources he has, he's trying and is actually doing a lot of good. And yet there's a gigantic amount of hate, conspiracy theories, and stuff like that. And feels like that's the case because he's somehow out of touch with people. So I wonder how you stay in touch with the voice of the people without being destroyed by the outrage. Is there any wisdom you have to that?

B

Brian Armstrong34:41

I don't know about wisdom, but I've thought about this too. You want to always be open to feedback, especially from people who have your best interests at heart. You can become isolated from it and surrounded by yes people. Maybe Xi and Putin are in situations like that, I have no idea. But if you listen to too much and try to please everyone, you'll never get anything done. Most of the best leaders are people who can act when they believe they're doing something net positive for the world and humanity, and they don't really care if they piss off some proportion of people. Almost anything you do of significance in the world today is going to piss off 5% of people, maybe 49%, maybe 60%. So you never want to become so surrounded by people who work for you and will say yes, that you think you're a genius. That's how you become a dictator. But you also can't care so much about what people think because then you'll never do anything authentic to yourself. One other thought: I've thought about this a lot. Why do people generally hate on Zuck and Bill Gates? They don't really hate on Elon. Well, actually Elon has a lot of haters too, but it's a different thing.

L

Lex Fridman36:07

This is measured. I was looking at some surveys. I think Zuck is the most loved and hated. He's the most hated. Then Bill Gates, and Elon is down there, in the double digits but low double digits. So it's interesting. You just look at the stats, ask yourself why.

B

Brian Armstrong36:34

Right. So I ask myself this sometimes too. I don't claim to know any of these people well, but I've met them briefly and my impression is that they're all smart people trying to do good things in the world. So why is it that some are really hated and some aren't? It's a complicated question. Obviously Zuck and Facebook got blamed for the whole election thing. Social media has gotten a lot of pressure. But one thing I've noticed is that a lot of these people have a little bit of Asperger's. Sometimes people with Asperger's don't emote in the same way. I think it's almost a form of bias against their cognitive type. That person doesn't emote right, so I don't trust their intentions. Another thing I've thought about is that sometimes I think some leaders...

L

Lex Fridman37:41

Well, let's take a break and come back to that. But I think we have a good sense of the early days. Thank you for sharing.

You know, like maybe Zuck or Bill Gates, they can come across as a little bit PR rehearsed, like they're basically giving the PR-approved answers, whereas Elon just says whatever he thinks, to a fault. So even if people hate what he says, they're like, at least I believe it's authentic.

B

Brian Armstrong40:02

Yeah.

L

Lex Fridman40:03

So I've always thought about that too for myself. I'm like, how do I? You can screw it up on both sides. If you just come out and say whatever's stream of consciousness, you'll often end up pissing off people on your team or tripping over some regulation. There's all kinds of things about running a public company – you can't say certain stuff. But if you're too PR-approved in your answers, nobody trusts what you're saying. So this is something I think about a lot. I don't think I have the right answer, but I'm trying to find that balance.

B

Brian Armstrong40:32

More and more with the internet, there's a premium on authenticity, just like you're saying. People really appreciate that. So for leaders, it's a challenge: how do I make sure I'm authentic, but also don't say stupid stuff?

L

Lex Fridman40:49

Yeah.

B

Brian Armstrong40:49

And so that's an interesting thing. I've noticed that having interacted with a bunch of leaders, you have to be careful how much you surround yourself with PR folks.

L

Lex Fridman41:01

Mhm.

B

Brian Armstrong41:01

Because the best marketing folks are extremely good. They understand that great marketing is authenticity – showing and revealing the beauty – as opposed to PR out of fear: don't say that, don't say this. That pushes you toward a bubble where you can't express your quirks and weirdness and the cool things about what you're doing. I find, especially with tech, like even Coinbase, the way to reveal the beauty is not only by showing what you can do with it, but by showing the great engineering underneath. Let the nerds shine. It doesn't have to be a commercial of a happy family sending flowers. It can be gritty, real stuff. That's a general observation. But you said you were talking about dark moments and that there were people on the internet pissed off that the site was down. You said there might be something else.

L

Lex Fridman41:09

Yeah.

B

Brian Armstrong41:10

So they understand exactly what great marketing is. It's authenticity, revealing the beauty. As opposed to PR out of fear. If you do that, you start living in a bubble and can't express your quirks. I find, especially with tech, like Coinbase, the way to reveal the beauty is not only by showing what you can do, but by showing the great engineering underneath. Let the nerds shine. It doesn't have to be a commercial of a happy family using Coinbase to send flowers. It can be gritty and real. Anyway, that's a general observation. But you said you were talking about dark moments, and that there were people on the internet pissed off that the site was down. You said there might be something else.

L

Lex Fridman42:23

Yeah, so sleep-deprived, a bunch of people on the internet were pissed at me. The balances were messed up. People were tweeting the company's over. Just give the money back. Then somebody posted my cell phone number on Reddit, saying if you need to get a hold of the CEO, whatever. I'm in the office late at night, trying to hack and fix the bug. We all need food, and my phone is blowing up. I answer a call, and it's a guy trying to deliver food. I answer, 'Is this Brian?' 'Nope, wrong number.' Click. Next call – a reporter from Japan. 'Nope, wrong number.' Finally I get the food, we survive. I remember a point that night where I just curled up in a ball on the floor and cried for a little bit. I let myself wallow in self-pity, took a nap for five minutes, and then said, 'Let's fucking solve this.' I stopped being a little whatever and got back up. Sleep deprivation combined with the stress and pressure of the site going down and everyone wanting it up – that pressure was mentally tough.

B

Brian Armstrong44:09

[laughter]

L

Lex Fridman44:09

Sleep deprivation combined with the stress and pressure of the site going down and everybody wanting it up – that pressure was mentally tough.

B

Brian Armstrong44:23

Yeah.

L

Lex Fridman44:24

What was your source of strength during that time? Like somebody patted you on the back and said we got this.

B

Brian Armstrong44:34

Yeah, it definitely helped to have a co-founder. There's an old saying: it's better to be in a great relationship than to be single, but better to be single than in a bad relationship. Co-founders blow up a lot of companies, but when you find the right one – I was lucky to find Fred Ehrsam – that was very important. There were moments where I was at wit's end, and he was like, 'Dude, let's rally.' He carried the team a couple of times in key moments.

L

Lex Fridman45:05

What advice would you give to startup founders about this particular stage? About surviving the five-employee stage?

B

Brian Armstrong45:16

Yeah, if you're pre-product-market fit, the best advice I have is that action produces information. Just keep doing stuff. Paul Graham had a great line: startups are like sharks – if they stop swimming, they die. So even if you're not sure what to do, just do anything, because it will produce information. People liked it, they didn't. That was very true for me. There were times I just did something instead of debating it endlessly. I shipped it, and the minute I shipped it, I knew we built it wrong, but now I had an idea of what to do next. I only would have had that idea if we'd gone through the exercise. Another analogy: you're at the base of a mountain shrouded in fog, trying to figure out how to get up. You can only see three or four steps ahead. So you have to take steps into the unknown. When you take three steps, the next three steps are revealed. Sometimes you hit a local maximum and have to retrace, or come up to a cliff. But most people don't take the steps into the unknown because it's scary – what if I fail? But the risk is often overestimated. If you go to a startup and it fails, you're even more valuable to your next employer. You can raise a seed round, pay yourself a salary, try for two or three years, and if it doesn't work, get another job. People overestimate the risk and never start because it seems crazy and all your friends think it's silly.

L

Lex Fridman45:32

It's a good line.

B

Brian Armstrong45:32

Yeah, Paul Graham had that line. Startups are like sharks – if they stop swimming, they die. So even if you're not sure, just do anything, because it produces information. That was true for me. I just did something instead of debating. I shipped it, and the minute I shipped it, I knew we built it wrong, but now I had an idea of what to do next. You only get that idea by going through the exercise. Another analogy: you're at the base of a mountain shrouded in fog, trying to figure out how to get up. You can only see three or four steps ahead. So you have to take steps into the unknown. When you take three steps, the next three steps are revealed. Sometimes you hit a local maximum and have to retrace, or come up to a cliff. But most people don't take the steps because it's scary. They think, 'What if I fail?' But the risk is overestimated. If you go to a startup and it fails, you're even more valuable. You can raise a seed round, pay yourself a salary, try for two or three years, and if it doesn't work, get another job. People overestimate the risk and never start because it seems crazy.

L

Lex Fridman47:35

It's just basic fear. It's the same kind of fear if a guy sees a cute girl at a bar – the fear of coming up to her. 'What's the actual risk, exactly?'

B

Brian Armstrong47:48

Right.

L

Lex Fridman47:48

Um.

B

Brian Armstrong47:49

She'll say, 'No, thanks, not interested.'

L

Lex Fridman47:51

And I guess the risk is that it's going to be mentally difficult to deal with rejection. So just like it's mentally difficult to deal with failure. If you have a bunch of ideas and you implement them and realize they're not good, that can be difficult to keep pushing through. But that's life. You're supposed to persevere through failures. The risk is low.

B

Brian Armstrong48:16

Yeah.

L

Lex Fridman48:16

And then the whole time through the fog up the mountain, you're looking for product-market fit.

B

Brian Armstrong48:22

Yeah, that's right. You know you have it when the usage of your product keeps growing without any marketing dollars. More people keep going back every week or month. You're basically watching your stats. Nothing is working, you see little wiggles of false hope in your metrics. You just keep talking to customers, improving the product. Talk to customers, improve the product. And try not to run out of money, so be really scrappy. If you're lucky, you hit some threshold where the thing is good enough, or you hit on a use case, and it organically starts to grow. Then you have a whole different set of problems once you hit product-market fit: how do we scale, hire people, raise more money? The problems totally change.

L

Lex Fridman49:12

Well, you were there through the whole thing. So that's the other question that's fascinating. Again, back to the girl at the bar, how do you hire people? How do you find good friends, good relationships? In this case, how do you hire good people – engineers, executives, all of it?

B

Brian Armstrong49:34

One thing is I've done a lot of reps on hiring at this point. Coinbase has about 5,000 people. Probably the first 500, I interviewed every single one. But you have to remember, on average maybe 10 people went through the process for everyone we hired. So by the time we had 500 employees, I had done like 5,000 interviews. I was very burnt out. Some days I did seven interviews in a day. You might not get burnt out, but it's a different kind of interview.

L

Lex Fridman50:11

Very different, very different.

B

Brian Armstrong50:14

Yeah, very different because you're – most of your interviews lead to rejection, which is also exhausting.

L

Lex Fridman50:16

[sighs]

B

Brian Armstrong50:17

Uh.

L

Lex Fridman50:18

So first of all, most of your interviews lead to rejection.

B

Brian Armstrong50:21

Yeah.

L

Lex Fridman50:22

Which is also exhausting.

B

Brian Armstrong50:24

Yeah. And there's a whole part of the interview which is about candidate experience. Sometimes you know it's not the right person, but you want to make sure they have a good experience. If you're exhausted and on your sixth interview and you wrap it up quickly, you're going to create a detractor who says, 'That company or Brian was rude to me.' So I had to work on that in the early days. I needed to make sure when people came in, I made them feel comfortable, asked warm-up questions like, 'How was getting in the office?' and not just run through an assembly line.

L

Lex Fridman51:04

But also there's a moment when you early on know it's not going to be a good fit, and you still have to land that plane.

B

Brian Armstrong51:08

Yeah.

L

Lex Fridman51:08

There's also a moment when you early on know it's not going to be a good fit, and you still have to land that plane.

B

Brian Armstrong51:15

Yeah.

L

Lex Fridman51:15

And all that kind of stuff. That could get really, really exhausting. So, yeah, anyway.

B

Brian Armstrong51:21

Yeah, so we tried many things over the years to make interviews more efficient. We usually get them down to 25 minutes. For hiring a big team of contractors, I've seen people do 10-minute interviews. You can interview a thousand people in a week. But for full-time employees, I usually do 25-minute interviews. One thing we've done is put a Google Form online with basic hurdles. We used to have brain teasers in the early days, but we don't do that anymore. We do normal interviews and references. The kinds of things I ask: I think about what we need this person to accomplish in the role, get really specific. I'll ask them to tell me about a time they did X, or the hardest problem they've had to solve in Y, and what they did specifically to overcome it. I'm also looking at culture fit. Are they concise communicators? Can they give a clear answer and stop talking? Some people ramble for 5-10 minutes. Some are interrupters. I'm looking for humility too – I ask about a time something went wrong, and I see if they were part of the solution or still holding on to blame. So I'm looking for: can they get the job done, will they work together on a team, can they communicate effectively, and do they fit our cultural values.

L

Lex Fridman53:48

I've done a bunch of hiring for this podcast and at MIT. I was always looking for simple questions that can reveal a lot. I used to ask, 'Do you think it's better to work hard or work smart?' I had this idea that people who say work smart don't actually work smart. The textbook answer is work smart, but people who haven't done anything say that. My belief was that to discover what it means to work smart, you have to work your ass off and fail a lot. So I was suspicious of people who said work smart. But I've learned that there are people who are exceptionally efficient even at a young age, so you can't disqualify based on that. You have to dig deeper. Some of the most interesting people unapologetically say work hard, and they're usually the ones who know how to be efficient. I've always searched for questions that can reveal something profound in as brief a question as possible. Then there are basic attention to detail and brain teasers depending on the role. Is there a question you find yourself leaning on?

B

Brian Armstrong55:55

Mhm.

L

Lex Fridman55:56

You see, you said 'how did you solve a hard problem in your past' – that's one.

B

Brian Armstrong56:32

We started with brain teasers at Coinbase, but we got away from that relatively quickly. I think it does show how someone performs under pressure, but it's not a super reliable indicator. Some people are good at typical work, but being put on the spot in a live interview is not typical. People get nervous. So I'm a little skeptical of brain teasers. There's a whole question about universities getting rid of entrance exams, so if you're hiring right out of university, the degree sometimes doesn't mean what it used to. I've heard some companies are creating their own standardized testing for college grads.

L

Lex Fridman57:42

That's fascinating. It's not just about you trying to hire a great team, it's also to help them find the right place to work. It's a two-way street. All right, so once you found product-market fit, how did Coinbase become what it is today? Let me ask an engineering question actually. From the Ruby wallet days, what were some of the interesting challenges? Were they engineering, regulation, financial, hiring, lawyers?

B

Brian Armstrong58:37

Post product-market fit, a lot of it is scaling and building out an actual company. I was still writing a lot of code for a while. We had about 25 people. One of our investors came by and asked, 'Brian, how much of your time are you spending writing code?' I said maybe 50%. He said, 'How much hiring?' I said 20%. He said, 'I think you need to flip those numbers. The company is not going to scale. You're the CEO, you don't need to be writing code every day.' That took me a while to internalize. I was still holding on too much to decision-making. Even to this day at Coinbase, we have to push down decision-making. So you need to make sure you have enough money to survive a downturn. We were periodically profitable during up periods, but crypto would go down and we were unprofitable. We had to manage our psychology and balance sheet. We had to professionalize services that had been thrown together by 20-year-olds – cybersecurity, finance, etc. Our finances were a mess. I remember after raising a Series C, I put $25 million in a different bank account because I had heard horror stories of startups thinking they had money but then going insolvent in three weeks. So I used that as a cheap hack until we could hire a real CFO and finance team.

L

Lex Fridman1:01:27

What was the ordering of hiring? How many engineers early on? Did you even have a CFO for a bit? What was the landscape of hiring as you built the company?

B

Brian Armstrong1:01:45

The first person we hired was for customer support because we were staying up till midnight doing it. Then we got more engineers. The sixth hire was a recruiter – that turned out to be a great force multiplier. We needed legal and compliance badly because of questions about legality. We needed more senior people. It was hard to find legal people who work with crypto; nobody had more than three years of experience because it had only been around a year. We found people from adjacent fields. There's a certain personality type willing to join early companies because they have no structure. You can't commit to a team or boss. Hiring is one of the hardest things in the early stage. You need to find people crazy enough to join you on the journey.

L

Lex Fridman1:02:56

So one of the interesting things about Coinbase is you're very focused on the mission. That simplifies things, makes hiring easier, makes working at Coinbase easier. What is the mission of Coinbase?

B

Brian Armstrong1:03:25

It's to increase economic freedom in the world.

L

Lex Fridman1:03:29

And what is economic freedom?

B

Brian Armstrong1:03:31

Economic freedom is a term economists use to measure countries. It looks at property rights, free trade, stable currency, ability to start companies, corruption, etc. Organizations score countries by it. The cool thing is that it positively correlates with things we want: higher growth, happiness, better environment, income for the poorest. It negatively correlates with things we don't want: corruption, war. So if you give people good property rights and rule of law and allow them to trade, it encourages them to do good stuff and society benefits. I spent a year in Buenos Aires, Argentina, which went through hyperinflation. There's a pessimism that creeps into countries without economic freedom – people don't try hard because they don't think they'll keep the upside. In America, historically, people try more because they believe if they do good, they'll keep part of it. When I read the Bitcoin whitepaper, I had a hunch that this technology could inject good financial infrastructure and economic freedom principles into countries all over the world. Crypto is well-suited for economic freedom: property rights through a 12-word phrase, global free trade, stable currency through Bitcoin and stablecoins. It's a secret hiding in plain sight that can create economic freedom for everyone.

L

Lex Fridman1:06:48

I didn't know about Argentina. Why did you end up in Argentina?

B

Brian Armstrong1:06:55

I was living in Houston, Texas after college. I had never studied abroad. I felt I needed adventure. I was running a tutoring startup and could work from anywhere. My plan was to do a month in every city in South America to force myself out of my comfort zone. I landed in Buenos Aires, got set up with an apartment and cell phone, and then didn't want to move, so I stayed there most of the time. It was a formative experience.

L

Lex Fridman1:07:45

You got to experience the social effects of hyperinflation. One of the limits on economic freedom comes from government regulations. How does cryptocurrency help resist that? Can you elaborate?

B

Brian Armstrong1:08:32

The traditional financial system has each country with its own currency and a group controlling the money supply. It can be manipulated. Many currencies are not linked to gold. Ray Dalio talks about thousands of fiat currencies that eventually get over-inflated and printed. Inflation is a tax on the poorest. Crypto is a return to the gold standard in the digital era. Bitcoin has guaranteed scarcity – never more than 21 million. Also, cryptocurrency enables global borrowing and lending marketplaces. In the traditional world, you'd need licenses in 200 countries. But with DeFi, like Uniswap, it's a decentralized exchange accessible to everyone regardless of jurisdiction. There's no throat to choke – no one can shut it down. It's a democratizing force creating a fairer, freer financial system.

L

Lex Fridman1:11:58

Is Uniswap in some sense a competitor to Coinbase? In which way is it, and in which way is it not? For people who don't know, Coinbase is centralized. Does that go against the spirit of crypto? What are the pros and cons of being centralized as an exchange?

B

Brian Armstrong1:12:23

I don't think Coinbase is fully centralized. We have many products. Our exchange or brokerage is a centralized, regulated financial service business. It's important for the crypto ecosystem to have that to allow fiat money to flow into the crypto economy. Once people have crypto, they can hold it in a self-custodial wallet or use decentralized exchanges. We love Uniswap and have integrated it into our products. Coinbase Wallet is a self-custodial wallet that allows people to hold their own crypto without trusting us.

L

Lex Fridman1:13:23

Can you explain what a self-custodial wallet is? What is the wallet, and what is a self-custodial wallet?

B

Brian Armstrong1:13:28

A custodial wallet means you trust Coinbase to store your private keys. For some people, that's simpler. They're not afraid of losing their crypto. A self-custodial wallet means you store the keys on your own device. Even if Coinbase gets a court order or gets hacked, we can't seize or lose your funds. But you have to take responsibility – you could get hacked. There's research to make self-custodial wallets more resilient. For example, multi-sig with keys on different devices, or threshold signatures. A simple example: two of three keys – one at Coinbase, one on your phone, one in backup. That way, you can recover if you lose your phone.

L

Lex Fridman1:16:12

That's an awesome idea. So if your funds get seized, Coinbase can't do anything. But you better not lose your phone.

B

Brian Armstrong1:16:19

Right.

L

Lex Fridman1:16:23

But there's a recovery mechanism.

B

Brian Armstrong1:16:24

Yes, even if you lose your phone, you can get the key from Coinbase and the backup provider to recover.

L

Lex Fridman1:16:34

But what if Coinbase is shut down in a country by government? Then you can't get it even with those two.

B

Brian Armstrong1:16:48

Right.

L

Lex Fridman1:16:49

So, isn't a self-custodial wallet a competitor to Coinbase?

B

Brian Armstrong1:16:59

No, we offer a self-custodial wallet. We've built one.

L

Lex Fridman1:17:04

But doesn't it bleed? How does Coinbase make money on transactions? Doesn't it decrease the number of transactions, or are you more focused on growing the pie?

B

Brian Armstrong1:17:26

A traditional financial service firm would say, 'We should keep more custody with us.' But we're focused on advancing the mission of increasing economic freedom. We want to help people get into crypto and then use it in the most empowering way, even if that means using self-custody. That's how we build trust and grow the ecosystem.

I don't really believe that. I think we actually want to encourage our users to move to self-custody over time for those who are ready and willing. That technology needs to mature. I'm not trying to force anybody who doesn't want to do it, but to me that's the future of how we get billions of people using crypto.

L

Lex Fridman1:17:53

But doesn't that mean they can go somewhere else easier?

B

Brian Armstrong1:17:57

Yeah, that's sort of the point. We're all using the same protocol, so there's low switching costs, which keeps all the companies accountable. If you want to access the Visa network, there's only one company you can go through. But if you want to access the Bitcoin network, there are dozens or hundreds of companies. So it's arguably worse for us as a company, but it's better for customers. It's what makes Bitcoin and cryptocurrency interesting: nobody controls it. There is low switching cost for customers, and that means all companies in the space are held to a high standard. If you lose someone's trust, they just move their Bitcoin to another service. That's good for the world.

L

Lex Fridman1:18:40

Do you think of Coinbase as layer one, layer two, or layer three technologies?

B

Brian Armstrong1:18:46

Yeah.

L

Lex Fridman1:18:47

Do you think of Coinbase as layer one, layer two, or layer three? Now that there are so many products under the Coinbase umbrella, it's hard to answer that question. But what do you think?

B

Brian Armstrong1:19:01

Yeah.

L

Lex Fridman1:19:01

Do you acknowledge the existence of layer three?

B

Brian Armstrong1:19:04

So, usually when people use those terms, layer one is the blockchain itself, like Bitcoin or Ethereum, not a centralized service like Coinbase or even our decentralized self-custodial wallet. So I wouldn't consider us to be a layer one. These are the decentralized protocols we're integrating, but Coinbase itself is not those.

L

Lex Fridman1:19:31

Yes. But layer two is doing transactions without settlement on the blockchain, so you get faster transactions without the security of the blockchain. Layer three is apps built on top of that. Talking to Michael Saylor, he considers Coinbase a layer three technology.

B

Brian Armstrong1:19:59

Interesting. Okay.

L

Lex Fridman1:20:00

[laughter]

B

Brian Armstrong1:20:01

Well, I'm not particularly familiar with the distinction of layer three and two. I don't see them as fundamentally different. One way of asking that is: is there some layer two magic happening to make transactions instant? On Coinbase, yeah.

L

Lex Fridman1:20:25

On Coinbase, yeah. Is there some magic going on there? Because you should say how many cryptocurrencies are currently on Coinbase. It's more than two.

B

Brian Armstrong1:20:36

Yeah. It's a lot more than two.

L

Lex Fridman1:20:38

So you have to understand they have to incorporate all these technologies. So how do you make that magic of universal transactions happen across all these different cryptocurrencies?

B

Brian Armstrong1:20:53

There are our centralized products and decentralized products. With centralized products, we store the crypto for you. If you're moving between your own accounts, we can do that transaction off-chain to make it faster and save fees. But it's not truly using the decentralized blockchain. You can also send to any Bitcoin or Ethereum address, which puts the transaction on-chain. With our decentralized products like Coinbase Wallet, every transaction happens on-chain.

L

Lex Fridman1:21:33

So that shows a little bit of the evolution of Coinbase and the blockchains. In the early days, these networks were not scalable, so there were no L2 solutions. We had to do hacks like moving crypto off-chain between your own accounts, otherwise the miner fees would have eaten us alive. But now blockchains are starting to scale, and we're getting L2 solutions. So more and more transactions are going on-chain, whether L2 or L1. Ideally, we shouldn't be doing that many transactions off-chain on the internal Coinbase ledger. That's not really in the spirit of crypto.

So when you say on-chain, that includes the Lightning Network, layer two technology. So I guess I was asking how much magic is happening off-chain within Coinbase. You're saying in the early days you had to, but you try to do less and less.

B

Brian Armstrong1:22:39

Look, there are high-frequency traders and regular retail people who don't want to pay gas fees. We calculated that it would be completely infeasible for high-frequency traders to put everything on-chain at this point. That's what DEXes are doing. Both are important. I think more and more will move decentralized over time, which is great. But centralized things aren't going away for a long time. A decade from now, there will be big institutions or pension funds that want to hold crypto in a centralized way. Both are important.

L

Lex Fridman1:23:33

Do you know the number of cryptocurrencies currently on Coinbase? Do you know that number?

B

Brian Armstrong1:23:38

It's over 100, but it depends on jurisdiction, whether you're an institution or retail. There are so many categories now.

L

Lex Fridman1:23:48

Over 100?

B

Brian Armstrong1:23:50

Yeah.

L

Lex Fridman1:23:51

So what does it take to become a cryptocurrency on Coinbase? To add your technology to Coinbase?

B

Brian Armstrong1:24:03

We're trying to get away from the idea that being listed on Coinbase is an endorsement. I think it's important that we are not considered judge and jury. Imagine the early days of the internet: what's a good webpage and what's a bad webpage? You would have been totally wrong. Apple gets in trouble with their App Store review process. Something that looks silly may turn out to be the next big thing. So we have a test of legality: we check if it's a security. If so, it can't be listed. We have a rigorous process for that. We also look at cybersecurity, compliance, and the actors behind it. If it meets our listing standards, we want to list it and let the market decide. It's like Amazon: a product might have three or five stars, but if it consistently gets one star, maybe Amazon will remove it. Otherwise, let the market decide. More and more of these assets, especially low market cap ones, will be traded on DEXes through Coinbase. We don't need to list every asset on a centralized exchange. DEXes are good for the long tail. My belief is there will be millions of these assets over time, so I hope it doesn't make news every time we add one.

L

Lex Fridman1:26:33

Yeah, I wonder how you get there. I look to Coinbase for verification signal. People tag me on Twitter saying I should interview the founder of a particular coin. It's hard for me to know what's interesting technology, who's a scammer, who's legit. Coinbase has become a little bit of that verification signal, and you're trying to get away from that. You're thinking of an Amazon star type system where people could rate.

B

Brian Armstrong1:27:35

Yeah, we'll probably add user ratings and reviews. We'll be cautious about making sure they're real people. Wisdom of the crowds is good for feedback, but we'll also do our own review to ensure it meets a minimum bar to be listed.

L

Lex Fridman1:28:02

How do you know if a coin is a scam or not?

B

Brian Armstrong1:28:06

I hate to use the word scam because these are judgment calls. Red flags include: a large portion of the asset owned by insiders with short vesting periods, founders with criminal records or past frauds, or if they're pumping it on YouTube and Twitter with promises of future value. A lot of this data is available on-chain. You can look at tokenomics and see who owns it and if they're selling inappropriately. We want to enable innovation but not allow fraudulent or get-rich-quick schemes that curtail the industry's advancement.

L

Lex Fridman1:29:28

It's a tricky industry. Let me ask about a tricky one to add to a centralized exchange: privacy-preserving cryptocurrency like Monero. Is that technically difficult, or why is it ever possible to add?

B

Brian Armstrong1:30:03

That's a great question. The answer is maybe. Because we're a regulated financial service business, we have licenses that require us to have a reasonable program to monitor for suspicious activity, an AML program. If a coin is 100% anonymous and we can't do blockchain analytics, it makes it harder to have a defensible program. But there are privacy-preserving coins like Zcash that have a view key, which allows deanonymization in specific situations. We support Zcash because when you buy it on Coinbase, the transactions are not anonymous, and we can see where it goes. If it gets a few hops away, people could turn on privacy aspects. These are tough judgment calls. But I think privacy coins are a good thing for the world. Just taking my Coinbase hat off, the world would be a better place with more privacy coins. It's like the internet: there was no HTTPS, now there is. Financial information is the most important to keep private. There are times you want transparency, like for a charity, but for personal money, you don't want to broadcast it. People should fight for privacy and freedoms, and privacy of money is a good thing.

L

Lex Fridman1:32:47

You've chosen with Coinbase to have a seat at the table with regulators. What kind of conversations are there? What are the regulations like? What is the level of understanding? What are they worried about? What are the positive and negative regulations you're facing?

B

Brian Armstrong1:33:19

We operate in maybe 100 countries, so conversations are all over the map. A positive trend is that regulators around the world are more and more asking, 'How can we preserve innovation while keeping bad actors out?' rather than 'This is all bad, how do we prevent it?' In the US, when I go to DC now, about 50-60% of people I meet are in the camp that crypto has potential and should be regulated thoughtfully. That's a huge change from three years ago when it was about 30%. It's getting harder to find true crypto skeptics. About one in five Americans have used crypto, so condemning it means condemning 20% of your fellow citizens. The same conversation is happening in India, Europe, Asia, with some countries like Dubai, UK, Australia pushing good regulation. El Salvador adopted Bitcoin as legal tender. China is more autocratic and trying to curtail it.

L

Lex Fridman1:35:56

So what kind of regulations do you feel are most limiting or empowering? Specific examples?

B

Brian Armstrong1:36:05

The securities laws in the US need to be clarified. Crypto is many different things. Bitcoin and Ethereum are more like commodities, regulated by the CFTC. Some are securities, regulated by the SEC. Stablecoins and CBDCs should be regulated by the Treasury. NFTs are artwork or metaverse items. There's an unhelpful view that most of this is bad activity and we need to shut it down through enforcement. Most people in DC don't feel that way anymore. We need a simple test: if nobody controls more than 20% of it, it's a commodity; if someone's raising money for a business, it's a security; if it's a medium of exchange, it's a currency; if none of those, it's artwork. That would clarify which regulator regulates what. We also need a sandbox for innovation, so startups with low volume don't face soul-crushing legal bills. If the US can get there, great. Other countries are rushing to create that regulation. International bodies like IMF and G20 are looking at proposed regulation. Coinbase has a policy effort to help in that conversation. In the meantime, we're trying to help more people use crypto, because in democracies, they'll do what the people want.

L

Lex Fridman1:38:54

So you want governments to understand differences between commodities, securities, currencies, NFTs. I still don't understand what NFTs are from a regulator's perspective.

B

Brian Armstrong1:39:11

Most NFTs you can think of as artwork, but it could be more. People are selling virtual land, or I bought an NFT that's like citizenship in a city DAO in Wyoming. It's like a badge or attestation for access. There are POAPs, proof of attendance. It'll be interesting to see where NFTs go. You don't want to define regulation if you don't know where it's going.

L

Lex Fridman1:39:58

Yeah, that's the danger. You don't want to try to define regulation if you don't know where this thing is going.

And so your efforts on the policy arm is education?

B

Brian Armstrong1:40:07

Yeah, education and advocacy. We try to be a helpful educational resource. If they give us feedback, we're happy to comply. We get licenses and try to do the right thing in the absence of clarity. That's part of innovating in a regulated field.

L

Lex Fridman1:40:40

So, if you are at the table, can government agencies seize a person's cryptocurrency by forcing Coinbase to hand it over? When you're centralized, they have a phone number to call.

B

Brian Armstrong1:40:58

This is a complicated topic. That's why people want self-custodial wallets. In the US, there is rule of law with protections around search and seizure. Coinbase publishes transparency reports. We get subpoenas and court orders. There are situations where we've been ordered to freeze accounts. We have to follow the law. But sometimes we get overly broad orders, and we've gone to court to push back and won on behalf of our customers. It's frustrating as a large business to spend resources interacting with inbound requests. Some are silly, and we have to say no. It's a tax on companies that gets passed to customers in higher fees.

L

Lex Fridman1:42:48

Can you educate me on something? How much innovation is there in the legal space? For lawyers working with Coinbase, because it's such a new cutting-edge thing, there's a lot of gray area. How hard is it being a lawyer at Coinbase?

B

Brian Armstrong1:43:10

It's probably very hard and very fun. In a new field growing fast, there isn't a lot of case law or precedent. That's an opportunity to create it. Legal careers are made out of balancing difficult things like preventing bad activity while enabling innovation. You can draft legislation and circulate it to policymakers. Our lawyers have to come up with creative stuff.

L

Lex Fridman1:44:07

You mentioned one of the things you're focused on is expanding the number of people, maybe a billion people on Coinbase or using cryptocurrency. Where are we at now? How do we get to a billion?

B

Brian Armstrong1:44:18

As of Q4 last year, we had 89 million verified accounts on Coinbase, but only about 10 million are really active in a given quarter. Globally, maybe 200 million people have ever used crypto. So we're a long way from a billion, but not that far off. How do we get there? First, blockchains need to become way more scalable. It's like we're all running dial-up modems and need broadband. If we get L2s working, we'll see another order of magnitude. Second, clearer regulation would help a lot. I talk to pension funds and asset managers who have 1% in crypto but would rather have 20%, but they're waiting for clear regulation. That would be a big unlock.

L

Lex Fridman1:45:45

Do transactions? Sorry, payments. What does that unlock a lot of users?

B

Brian Armstrong1:45:55

Yeah, remittances are huge. People sending money home to families in other countries where fees are super high. If blockchains become more scalable and there's more global adoption, remittance corridors will move to crypto. Also, the creation of more third-party apps, or dapps, is driving adoption. In the early 2000s, they were called dot-com startups; now there are hundreds or thousands of crypto startups. In the future, they'll just be called startups because everyone uses the internet and crypto. The utility of crypto is getting better with all these apps.

L

Lex Fridman1:46:50

Do you think there's going to be a killer dapp or set of killer dapps? A thing nobody can live without. I'm still waiting for that.

B

Brian Armstrong1:46:59

There's going to be a bunch of them. It's like the internet: Uber, Wikipedia, Airbnb, Google. There will be some big winners, but thousands of them. The best entrepreneurs are building crypto startups now. Tons of venture money and smart young people are flowing into the space.

L

Lex Fridman1:47:25

Do you think Bitcoin or some other cryptocurrency will become the reserve currency of the world at some point?

B

Brian Armstrong1:47:31

This is controversial, but I actually think yes. I've been reading Ray Dalio's 'The Changing World Order.' He looks at history and how empires rose and had reserve currencies. The US has had a good run but may be coming down. China is coming up. If the US dollar sees more inflation, the yuan isn't necessarily better. There's a group of younger people, 25-35, tech-savvy, who think of crypto as the primary thing in their financial life. They hold wealth in crypto and convert to fiat only when needed. This segment isn't massive yet, but it's a leading indicator. It's good for the world, especially if China continues to rise with an authoritarian view. A decentralized West embracing crypto in an open, fair, free global financial system would be enormously beneficial. Bitcoin is the reserve currency, the gold standard of the crypto economy.

L

Lex Fridman1:50:09

Yeah, the gold standard. With Ray Dalio, I feel like China will drive a lot of this. Maybe an authoritarian regime will switch to a Bitcoin standard first, and the West will catch up. It's fascinating to think about the forcing function. But I hope we don't have to wait for the older generation to pass away for change.

B

Brian Armstrong1:51:25

That's a super interesting topic: how people's minds become less plastic as they age.

L

Lex Fridman1:51:32

I guess it's a feature. It's called wisdom. But we also need the wild ones to explore. Exploration versus exploitation. You wrote a blog post in September 2020 titled 'Coinbase is a mission-focused company.' One interesting thing you said is that we're not going to be distracted by activism within the company that's not related to the mission. That's a rare thing for a CEO to state, especially in this climate. Can you describe in more detail what you meant? Did you receive blowback for this?

B

Brian Armstrong1:52:22

I definitely received some blowback. What I meant is that many companies, including tech companies, have an important mission but get distracted by employee activism. Employees want the company to jump into whatever the current thing is, to virtue signal. I think this is destructive and making America less competitive. When we put out the statement, employees outside the US were confused: 'Why did Brian need to say that? We're already focused on work.' But in certain US cities, a peculiar cultural phenomenon had evolved where people wanted the company to act like the government and solve the hardest societal issues. I was uncomfortable as CEO. Most questions from employees used to be about products and competitors, but around that time, they were about broader societal issues: 'Brian, what's your stance on XYZ?' I often didn't have an opinion. It was distracting. People were getting into fights on Slack. It culminated in a walkout and demands from employee groups. I felt like we're all on the same team. If you want to be antagonistic, let's do it with someone outside the company. Eventually, I said the company is not aligned. I made an exit package available to anyone not on board. 5% of employees took it. I realigned the company towards the mission. People can do activism outside of work. At work, we can disagree on work, but don't bring in stuff that creates division. Make the workplace a refuge from division.

L

Lex Fridman1:56:22

Yeah, that was really refreshing to hear. So, this is me speaking, but there's a sense when companies take on these issues publicly...

B

Brian Armstrong1:56:33

From a CEO position or anywhere else, it does seem to optimize for virtue signaling versus solving a particular problem. Because to solve a particular problem, you really have to put in a huge amount of effort, you have to hire a huge number of people, you basically have to create a company to take on a particular thing. But if you allow yourself to internally care about a particular issue, you're basically pacifying some number of employees, making sure the Slack doesn't get out of hand. And then you're doing this kind of from my perspective, especially on issues I care about, fake virtue signaling, basically trying to understand what will make me look the best, what will make the company look the best in this particular aspect. And it just seems very shallow and it's optimizing for the wrong thing, not for solving the problems, but for making yourself look like the good guy and trying to leverage that to say I'm the good guy in all situations. And it's the wrong thing, and perhaps from your perspective as a CEO, as a leader, it's also creating division, unnecessary division within people. Like they get extremely argumentative about certain topics. They really bring out the emotion. And I think that probably, as you were saying, that emotion is even probably okay, maybe productive when that emotion has to do with the mission of the company. Like you really care about those disagreements versus something that has nothing to do with increasing economic freedom using crypto.

L

Lex Fridman1:57:26

Yeah.

Yeah, it's fascinating. But it was so refreshing because it's rare. Why do you think that's rare? So the city you're mentioning, there's a bunch of cities, but San Francisco is one such city where that culture exists. It's sad because San Francisco is also the Bay Area, historically the hub of some of the greatest innovation in human history. So there's that tension. How did that culture emerge there where the innovation was done by people that are very mission-driven? You have to get a bunch of smart people together to solve a difficult problem. They get maybe sometimes too much blinders on, but they try to balance that because it requires that focus to solve an actual problem. And yet that's also the place where this culture emerged. It's a fascinating human dynamic. I don't know. Somebody will one day tell the history of Silicon Valley, not just the innovation, but the social dynamics that occurred there. Anyway, why do you think that's so rare?

B

Brian Armstrong1:59:29

Well, because people don't want to get attacked. It's super uncomfortable. Nobody wants to be called a racist or whatever. People want to say on Twitter. So you get attacked. Yes, I definitely got attacked. I knew it would be controversial. The only reason I did it, frankly, was that I was kind of at my wit's end. I was like, well, like I said earlier, the CEO job sucks. Either I don't want to do it or they have to go, and I'm going to make the company into something that I want. And I spent eight or nine years of my life at that point building this thing. I was like, well, I could go start another company, but it takes a long time to get momentum. And Coinbase is a very rare thing that happened in the world. I feel very passionate about it. So I'm not going to go. I need to make this the company that I want to work at. And what was really interesting was that there was such a huge outpouring of support. I knew it would be controversial and I would get attacked, and predictably, there were journalists from the New York Times and all these people who started writing hit pieces on the company shortly thereafter. They basically just called people who left the company and got quotes on whatever they wanted and then wrote a story. So I lost a lot of trust in mainstream media, frankly. And of course, it's become obvious since then that most mainstream media is hyper politicized at this point, either super left or super right, and not really focused on truth. That's unfortunate because I think journalism is really important in society. So that whole thing got eroded in the US. Luckily, there's new media, people like you and a whole bunch of people.

L

Lex Fridman2:01:03

[laughter]

B

Brian Armstrong2:01:03

That's kind of unfortunate because I think journalism is actually really important in society. So that whole thing got eroded in the US. Luckily, there's sort of new media, people like you and a whole bunch of people.

L

Lex Fridman2:01:14

Did that blog post help? That statement, the 95 people that remained. Is this still something you struggle with because it's also culture in the broader tech space?

B

Brian Armstrong2:01:26

Okay, so that was an interesting thing. 95% of people stayed. I got a huge outpouring of support from people who said, 'Thank God you finally spoke up and said something, because frankly, it was making not a very fun place to work either.' And I realized that there is, I think it's Nassim Taleb's blog post about the tyranny of the 1% or something like that. There's a relatively small group, 1 to 5%, that is really upset about something. It's not the majority of the company. There's another 15% that are sympathetic to the cause. They're somewhat suggestible and will go along with whatever because it sounds reasonable. They're real issues. And they get swept up in it. But there's 80% of the company that basically doesn't agree or just wants to get their work done without all this drama and distraction, and they're afraid to speak up because they're afraid of being called a racist, fired, ostracized. So it required getting to a bad enough place for me to finally say, 'I feel like I have to do this, live through the short-term attacks of the press, which ultimately was very freeing because now I don't really care.' And now I can actually just build the company that I want to build without caring about that. So then what was cool was a lot of really great people reached out to Coinbase after that and were like, 'I'm an early engineer at Google and this culture has gotten messed up and I want to work at a company that's willing to stand for that.' So we got a lot of good people. Basically, what I realized, and by the way, our diversity numbers, people told me when I was drafting this post, 'Don't post this. People from underrepresented groups will never want to work at this company again.' And I was like, 'I don't think that's true.' I talked to our ERG groups and they weren't telling me they care about this stuff that much. They just want to be respected at work and do good work and contribute. So my gut was telling me that advice was wrong. And a year later, our diversity numbers are either the same or better in every category. So that turned out to be false. I hate to be polarizing. I just want to get good work done and build good stuff with technology. So I think companies should just have reasonable policies. You want to get rid of bias in hiring, attract great people from all different backgrounds. We have Pledge 1%, put 1% of company equity into a foundation. I hope we're able to do good stuff with that. But the main message for me is the core mission, the core work we're doing on economic freedom and all our products is the main value we're contributing to the world. Let's just do that more and hopefully we can get from 89 million verified users to a billion. And that's how we'll have the biggest impact.

L

Lex Fridman2:04:32

It's tempting though. It's so interesting how companies get tempted to help. And you step in and it's almost like a drug and then you forget. In life, it doesn't have to be companies, you get distracted. And maintaining focus, you're absolutely right. The way for Coinbase to add value to the world is to maximize the mission it's on, not other stuff. And when you get wealthier and more successful, this becomes more and more tempting to just help out in some other shallow ways. And it's fascinating and you just kind of brought that to light, so it was very refreshing and it shouldn't be controversial to focus on just getting stuff done.

B

Brian Armstrong2:04:36

Yeah.

L

Lex Fridman2:04:46

Yeah.

Well, let me ask you. Do you think that all these things tie together? There's a general trend of more censorship, more cancel culture, some of these freedom values are kind of being eroded, even freezing people's accounts like the trucker thing that happened. There seems like a general trend of more authoritarian policies. But do you feel like the tide is turning on that? There are counter examples we've seen recently.

B

Brian Armstrong2:05:46

Yeah. I think it's the last gasp of the old way of doing things, and so there's desperation. To be fair, it's the internet, which is the source of a lot of this, where people have a voice is making the power centers of the world really nervous. So that's where that's coming from. The internet is tricky. It's full of bots, misinformation of all kinds, large groups with conspiracy theories. And I mean misinformation broadly. People misuse the word misinformation. Governments label random things as misinformation just to censor them. But I just think it's a new world where the internet has really taken hold, with billions of devices and everybody has a voice. Governments and powerful people are slightly losing hold of power and they're starting to freak out a little bit. And then once young people coming up gain power, I think we'll rebalance everything. There are promising signs that the majority of people want freedom. That means economic freedom, freedom to have a voice, freedom to move around, freedom to act in the way they want without unreasonable limitations by people that don't have their best interests. I gain more hope from regular people fighting and demanding freedom of speech, resisting government overreach in censorship, at least in the United States. Hopefully that percolates out to the rest of the world struggling on a much more basic level, where people are being put in prison for words, not just banned from Twitter.

L

Lex Fridman2:08:00

Right. Could be worse.

What are some lessons from your failures and your successes about what it takes to run a company?

B

Brian Armstrong2:08:10

I think one of the things I've learned about leadership is that I never really thought of myself as a very natural leader. I don't think I was a natural leader. I always envisioned good leaders as military generals, confident, barking orders. But I was more introverted and not really confident in how I communicated. So what I realized is that there are lots of different kinds of leaders. You can be any kind of CEO you want. I was more of a product technical focused CEO. I preferred to hear everyone's opinion, and I wouldn't render a decision in the room in a heated moment. I would go think about it and send my decision later. So I found ways to make it work for me. I always tried to avoid when people get super emotional because their judgment goes down. Never make a decision when you're angry. So I would try to get a sense of whether people are trying to be right or seeking the truth. You can do little tricks like argue that person's position and the other one to see if they can genuinely represent it. But getting back to your question, I basically kept doing things that were a little outside my comfort zone, and my comfort zone kept getting bigger. That's how you build confidence. You do the thing that's scary. When I first started Coinbase, I had never managed anybody. I would have been scared to death to put out a very controversial opinion. But we didn't know what percent it was going to be. It could have been 1% or 50%. But we went into it scary because I thought it was right. So if you do enough scary things, you'll build the confidence. And I'm still on that journey. Every year or two at Coinbase, there's some big thing that comes out that makes me not sleep well for a week. That's how you learn and grow.

L

Lex Fridman2:10:35

So you're still going up that mountain through the fog one step at a time.

B

Brian Armstrong2:10:39

Yeah.

L

Lex Fridman2:10:40

Can I quickly ask you about a couple of other efforts you're involved with? First, ResearchHub, the GitHub for open science. What's that about?

B

Brian Armstrong2:10:56

Yeah, okay. So I've had a chance to help a couple other companies get off the ground because I want to see various efforts succeed. One of them is about why scientific research isn't more like open source software. There are antiquated things about scientific research: the funding process, grants, peer review, journal submissions, costs. You'd think you'd get paid for this and it would be available to taxpayers for free, but no, it's all paywalled. There are big companies that have held back innovation. Preprint services like bioRxiv and arXiv have helped, but they look like they're from 15 years ago. So after Coinbase went public, I had a little liquidity and funded a small team to make something better. We have a prototype at researchhub.com. The first version is like Reddit for science, with hubs like journals. You can publish papers, use an electronic lab notebook for living documents. In the future, you can get comments, feedback, update over time, share code and data sets. Eventually, people can get funding through the site and license innovations. The other thing is that there are people working on science and people building companies, and they rarely intersect. When they do, you get great things like SpaceX, Genentech, Google, even Coinbase based on the Bitcoin white paper. Most businesspeople create companies without scientific innovation, just marketing. A lot of scientists make things that never benefit humanity because they're not commercialized. So if we can create a translation layer between those two groups and align market forces with scientific research, it would incentivize discoveries like CRISPR. Entrepreneurs should commercialize the latest scientific innovations. That's the long term vision. It's early, but we have a passionate community discussing and improving innovations.

L

Lex Fridman2:14:06

So I'll have a question about incentives, but first let me say for people outside academia, there's an absurd situation. Journals provide very little value except matching you with unpaid reviewers. In the digital world, they provide almost no value except hosting your paper, and they put up a paywall and charge a lot of money. They're blocking research that should be wide open. It's a scam, but a shitty one because they're not making that much money. So they're holding back human knowledge for shitty money. People get confused because journals aren't funding scientists. The funding comes from elsewhere. Journals are the middleman nobody asked for, especially in the digital world. That said, there are incentives for scientists like prestige. If you get into a prestigious journal or conference, it's good for your resume and respected in your community. Is there some way to achieve that same kind of incentive in the open setting of ResearchHub?

B

Brian Armstrong2:16:22

I think you're right. The whole academic progress track is about where you got published and citations. It's a false economy of reputation because there's no real money backing it. We've thought about this. ResearchHub has an opportunity to create leaderboards for top papers in each category by month and year, and give out grants and awards, almost like a ResearchHub prize. We could even print a journal of the top papers. People want to put that on their wall. So we need to change the culture to not celebrate publishing in paywalled journals. Friends don't let friends publish in paywalled journals because it's not helping humanity. It should be more prestigious to publish in an open science way and get the top spot than to be in a traditional journal.

L

Lex Fridman2:17:57

Well, there's already a culture shift where almost everybody publishes on arXiv and bioRxiv. So that scene already has the 'friends don't let friends not publish open' mentality, but the prestige thing is missing because anyone can publish on arXiv. How do you know it's a strong paper? Funny enough, even with crappy systems, word of mouth is powerful. Citation systems are pretty powerful. The community is the reviewer. We don't need traditional reviewers. But it would be nice to have a Nature level respected accomplishment. So a leaderboard but a stable system.

B

Brian Armstrong2:18:55

Yeah. And there's a crypto angle: ResearchHub has a coin called ResearchCoin. If people upvote your paper, you accumulate ResearchCoin, which is a reward token. That measures the community's collective view of the paper, a form of peer review, weighted by reputation. In terms of prestige, it won't start off that way. It'll start quirky like YouTube with cat videos, but now a million subscribers on YouTube is better than a TV show. So in 10-20 years, it could become the prestigious way for young scientists to publish, and traditional journals will be viewed as old-fashioned.

L

Lex Fridman2:20:05

It's definitely a system that could do a lot better, and there are brilliant scientists who deserve better platforms.

So another thing you're helping out with is New Limit, which is looking at longevity. What's the idea there?

B

Brian Armstrong2:20:25

Yeah. I'm excited about science. If you get scientific innovation, you get better products, economic growth, and surplus for arts and philosophy. With New Limit, I started hosting dinners with scientists and learned about cell reprogramming. You've probably heard of induced pluripotent stem cells, where you can turn a skin cell back into a stem cell. Shinya Yamanaka won the Nobel Prize for that work in 2006. Recently, people are experimenting with different transcription factors to revert cells a little bit, not all the way to stem cells to avoid cancer. They want to make cells act younger. So I decided to fund this. A team of talented people came together to build a platform that tests different transcription factors on different cell types to rejuvenate cells and extend human health span. The moonshot goal is a therapy that in 10-20 years could rejuvenate the whole body, including the brain, so older people can still learn. It's inspired by Elon Musk: take on high technology risk problems with enormous potential impact. I like trying hard tech problems, especially for founders who made money in software. We're in a golden age of software, but if you make money, do atoms not bits, try harder things in biotech. So we should try hard tech physical science problems to advance humanity.

L

Lex Fridman2:23:28

Yeah, so he's also doing bio with Neuralink. Bio is tough. It's messy. We don't understand it as well. The risk is higher. You have to deal with FDA approvals. It's a long journey.

B

Brian Armstrong2:24:09

If I can give a quick plug, I'm on the board at New Limit. We're hiring talented scientists interested in cellular programming, not necessarily from an aging background. It's a small team, just a handful of people. We're hiring more. Same for ResearchHub, we have a small team doing software engineering, design, product.

L

Lex Fridman2:24:23

Is New Limit relatively new?

B

Brian Armstrong2:24:26

Yeah, it's very new. A small team. We're hiring.

L

Lex Fridman2:24:45

What advice would you give to young people today? High school, undergrad, about life, career, having a life they can be proud of?

B

Brian Armstrong2:25:07

People can do whatever they want to be happy. There's not one way. But some people want to have an impact on the world, that's how they get fulfillment. You need health, good relationships, but most people want to do something important and have fulfilling work. Many young people think they should be activists, but I don't think that's the right way to have an impact. Everybody has more power than they realize. It's easy to be a critic, hard to actually fix things. You'll get accolades from friends for criticizing, but it's easy. So be the person in the arena, like Theodore Roosevelt said. Chew glass and stare into the abyss. If you want to have an impact, join a company with a mission you're passionate about, or start that company or a charity. Go be part of the solution. Technology is one of the most important ways to improve the world. Climate change, education, transportation, financial system, global freedom – technology is the way. I find it bizarre there's an anti-tech thing. Nothing is perfect, but most things are net positive because most people are good. So mitigate the 1% of bad people, but 99% are good. Improve the world with technology, joining or starting companies. If you're not sure what to do, just get started with anything.

L

Lex Fridman2:28:25

And basically have the optimism that you have the power to create change. It's easy to distract yourself by being the critic. But everybody has the power to be the fixer. I like 'chew glass and look into the abyss.' That's much more fun than it sounds.

What do you think is the meaning of this whole thing? Why are we here?

B

Brian Armstrong2:28:58

Life.

L

Lex Fridman2:28:59

Yep. What's the meaning of life? This existence. You're trying to increase economic freedom, alleviate suffering. But why?

B

Brian Armstrong2:29:11

I don't think there is any point to life. Someone once told me that when you go into big existential questions, it can get scary because you stare off the cliff and there's nothing there. They said, 'Brian, you should probably snorkel, don't scuba.' Some friends go to meditation retreats and come back with existential dread. As far as I can tell, we are organic molecules in the ocean that started dividing and replicating, selfish gene, ended up here. Our only purpose is a naive algorithm to survive and replicate. We have DNA like every animal, but we developed neocortexes and are self-aware. We might create simulations inside our computers. I think it's cool. I want to keep watching the movie unfold. That's why I work on New Limit – to live longer, whether uploading brain to cloud or through biology or strong AI. One of those will hopefully work out, and we get to keep watching the movie. So I don't think there's a real purpose, just try to have fun.

L

Lex Fridman2:30:58

Well, the cool thing is that we get to write the movie as we watch it.

B

Brian Armstrong2:31:04

Yeah.

L

Lex Fridman2:31:05

That's exactly right. That's like the Steve Jobs quote about everything around you was invented by someone who thought up a crazy idea. Once you realize you can do anything you want, you start to try crazier stuff. You can build your comfort zone around people being upset with you, and also your range of what you think is possible. When I was in my 20s, I read self-improvement books and wrote down goals. My goals were like wanting to make $100,000 a year, own rental property. I slowly achieved things and started thinking bigger. I wrote down the craziest goal: start a billion-dollar tech company. I had never started a million-dollar company. I wrote that down every day for a year. Little things started happening. After about 10 years, Coinbase had a valuation over a billion dollars. So now I think about the next crazy goal: get a billion people accessing the open financial system through our products, or radically extend human health span. Try crazier stuff. Even if it doesn't work, something interesting will happen. People look at those trying and think they're genius or idiot, but neither is true. Anyone can start by thinking about what they want and go for it, then go bigger. Have fun with it.

And the universe has a way of smiling and helping you out if you write it down and dream big. There's something about karma, the energy you put out. Other people will help, doors will open. You'll notice and have a shot at making it happen.

B

Brian Armstrong2:34:42

Yeah. I don't subscribe to woo-woo interpretations, but my rational brain says that if you wake up every day and write down what you want towards your larger goals, it's on your mind. You start to notice opportunities and think about it more.

L

Lex Fridman2:34:59

So Brian, thank you for dreaming big. Thank you for doing incredible engineering at scale, helping people all over the world, and personally getting me more into crypto because it's so easy. Thank you so much for giving your extremely valuable time today to this awesome conversation.

B

Brian Armstrong2:35:23

Thanks for your awesome podcast. I love it. I listen to it often.

L

Lex Fridman2:35:27

Thanks for listening to this conversation with Brian Armstrong. To support this podcast, please check out our sponsors in the description. And now, let me leave you with some words from Benjamin Franklin: 'An investment in knowledge pays the best interest.' Thank you for listening and hope to see you next time.

#307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation

About Brian Armstrong