Decentralization and the Internet of Value - Michael Healy - Unit Masters Cohort 14

Thank you so much everyone. Really appreciate this opportunity to present today. I'm sorry it was slightly delayed. I had certain technical difficulties. I'm really looking forward to presenting today. Maybe how we can do this is how we got into this industry, what Unit is particularly focused on, as well as if anyone's interested, please feel free to message. What the underlying ethos is, what the mission is, why this industry is so exciting, and how we see it has a long future ahead. To begin with, I'm originally from the UK. I've been building technology companies for the past 15 years. I obviously got into crypto and digital assets in 2011. I was working for WikiLeaks. I built their mobile applications, and then the government didn't like what WikiLeaks was doing and it basically froze the banking process, information channels, PayPal, Visa. It was really challenging and difficult to fundraise, and we started using this technology, Bitcoin, and it was super revolutionary.

Is that better now? I was talking without the headset supporters. Thank you. Can you hear me now? Hopefully it's better. All right, wonderful. So I've been in this space since 2011. Originally got involved fortunately with an introduction to Bitcoin. What was so cool was it was the first technology where we didn't have to trust a central entity. If you think about most organizations, banks, payment processors, we all depend on a very small number and we kind of hope and trust that we can rely on them. It was really cool because Bitcoin was the first thing which didn't need this central entity. It allowed you to send and receive payments in a distributed way where you didn't need to trust a small number of individuals. I'm currently in Argentina attending a Polkadot development program. Someone like in Argentina, the currency has dropped 15% in the past two weeks. It's really shocking. The idea that someone can work hard, save money, and then out of no fault of their own, the value of their savings just depreciates, becomes worth 15% less. I think this is really just the beginning of this digital asset revolution. I think coins, tokens, blockchain, Bitcoin, Ethereum, Polkadot, all of these blockchains are going to play such an instrumental role in the future. I'm really excited to talk about how Unit fits into this mission and vision of the token economy. I'd like to explain what the token economy is, why it's so important and relevant, and how people here can think deeply about how to apply the token economy to the real world.

A little bit of a thought: there are basically two groups in society. There's one group which is the founders and the investors, and there's another group which is the customers and employees. Basically, all of the value in the world gets accrued by the founders and the investors, not the customers and employees. If you think about Elon Musk, Jeff Bezos, Mark Zuckerberg, these are the founders and the people who invested in them. They capture a lot of value in the world. If you're an employee or a customer, a content creator, a user, you don't benefit in all of this significant upside. It's a little bit broken. If you look at something like PayPal, if you're the first PayPal user, the first Uber driver or Uber customer, you didn't get to receive the 80 billion dollars that Uber went on the stock exchange for. All of that money went to the founders, all of it went to the investors. If you think about PayPal, if you're the first PayPal user, you send and receive payments, you told your friends about it, you didn't receive the billions of dollars that eBay paid for it. But you compare that to something like Bitcoin or Ethereum or Polkadot or BMD or Magic, all of these blockchains provide a way for the community, it allows all of the users to get a piece of the upside. What the token economy represents in our opinion is an economy where the ownership of things are held in tokens. What that means is, let's say your favorite restaurant, your favorite cafe, your friend is a football player. Just think that there's going to be a token which captures their value. Instead of it being stocks and shares, it's going to be a token. That token is going to tell you: the founder gets this many percent, the investors putting in money get this many percent, the customers get this many percent. Let's say you're the first customer, you went into the cafe when you were 17. You're like, okay, I'm going to buy 10 euros or 10 pounds worth of this cafe, and you're going to tell your friends, let's go check out the cafe, let's organize some events, let's get more people to hear about it. So the really exciting thought is this idea that any business, any person, any project is going to be using tokens in the coming decade.

How does Unit fit into that? We basically realized that tokens are a really big future, and we're a really easy-to-use tokenization network and platform. What that basically means is, let's say I'm a person. I can create a token. I can give my friends, my family some of my tokens so that when I become successful in what I'm endeavoring to do, let's say sport, or let's say I start a business, or I get a good job, I can put some of that value that I make into my token. I don't capture all of it. It gets shared amongst my community. All of these people, my friends, my family, they're going to be incentivized, they're going to be motivated to help me achieve what I want. If you think about everyone here, and you think about your friends who had an idea and made it successful, you probably recognized that before they were really successful. You're like, okay, she's really talented, he's really smart. It would have been nice if you could have been like, hey, how can I buy some of your tokens, or how can I support you on your journey to receive some of your tokens? Unit basically makes it really, really easy to do that. If you go to unit.network, we can also post an invitation link. This is what the platform looks like. If you hit Launch App, if you want to create a token, you basically go to Create. Let's say I'm going to create a Unit Masters demo token. You just hit Create. Just like that, you've created a token. Wow. Creating a website used to be really tough. Creating an app or having something on mobile has been really tough. Unit basically makes it really, really easy. Just like that, you've created a coin. Every coin basically has a concept of a bank and a treasury. The bank basically tells you how it's doing on an operating basis. Is it generating revenue? Is it spending money? How's it doing? Let's say I was a musician and everyone here gave me ten dollars. Let's say collectively it's a thousand dollars or two thousand dollars. I use that money and I make it a hundred thousand dollars or two million dollars. How are you going to be protected to make sure that I don't run away with that money? How do you make sure that I'm actually going to give you some of those profits, thanks to you supporting me in my career? That's where the treasury comes in. Basically, when people generate lots of revenue, they provide products or services. That goes to the bank. Once there's a sizeable amount of surplus, extra in the bank, that can go to the treasury. The treasury basically gives you an indication of the lowest price. What does that mean? Lowest price. You can see that there's a hundred thousand Unit Masters demo tokens. If there was a hundred thousand dollars here, the lowest price would be one dollar. That basically tells you that in the worst case scenario, it's not going to drop below one dollar because the creator of the token, the manager of the token, has moved funds from the bank to the treasury, and they can't touch this money in the treasury anymore. It's basically protected, protecting everyone in the community. Then there's also an exchange that gets built in. Basically, every token has this exchange where you can add in USD as well as the name of the token that you're creating. Based on the ratio of these two tokens, it's going to tell you what the current price of the token is. If there was let's say 200 here and 100 Unit Masters tokens, then a Unit Masters token is worth two dollars. If there was 50 USDU and there was 100 Unit Masters demo tokens, then it'll be 50 cents. This kind of changes based on people buying and selling. It's called an automated market maker. The most famous automated market maker was called Uniswap. They started it in 2020. Another automated market maker which is quite popular was called Bancor. We're excited to take this concept of automated market makers like exchanges to everything in the world. We think every single Unit Masters participant here will have a token.

Let me try to move to make it sound a bit better. Hopefully the audio would be a bit better. Is it better now? Hopefully the audio is perfect. Okay, wonderful. I'm sorry if it wasn't perfect. I'm trying my headphones. Cool. So basically, automated market makers are super cool. How it works is you put funds, you stake funds into the pool, and then based on the ratio of these two tokens, it gives you a current price of what the token should trade at. There are two types of exchanges: there's an automated market maker exchange and there's an order book exchange. These are how coins and tokens get priced. The more common is the order book exchange. If you go to Binance, you've heard of Coinbase, you've heard of Bittrex, you've heard of all of these very famous exchanges. They all use an order book exchange. Another well-known one is where people say I want to buy Bitcoin at this price, I want to sell it at this price, and that's where it comes to a middle ground. I can also walk you through if you go to a website called CoinGecko. Here you can see all the different digital assets. Let's say we went to Polkadot as an example. We're an early investor and we're also built on Polkadot. If you go to one of these exchanges, you can see all trading pairs. Maybe even Binance. Here you can see this is an order book. Why is the price of a Polkadot token 6.50, 6.52? It's because the highest price that someone's willing to pay is 6.52 and the lowest price someone's willing to sell is 6.527. All of these are the people trying to sell and all these are people trying to buy. Here on the right, you can see in the past couple of minutes and seconds, someone sold 22 Polkadot tokens for 6.69, someone sold 60 DOT tokens for 6.50. You can see the time, how many they were selling, the price they were selling it. Also very interesting is the chart here. This chart kind of looks tough to understand. What are these bars? What are these lines? You can see here on the time, there's one second, 15 minutes, one hour, four hours, one day. As an example, we can put 15 minutes. Basically what that means is each of these bars are 15 minutes. If you put one second, it basically means each of these bars are one second. I'm going to put one minute. Basically what that means is in this one minute, the lowest price that it was at was here and the highest price was here. You can see where it's like a big... This is called a candlestick. Where it goes really thick is where the one minute started and where the one minute ended. You can basically tell in that one minute what was the highest price, what's the lowest price, and what was the range by which it was at. That's how all order book exchanges work.

I guess why we were so excited about this revolution is because when the internet started, it really revolutionized access to information. Before, if people wanted to learn about something, they needed to go to a library, they needed to speak to an expert. It's very expensive to go to a university, which is very difficult to get into. It wasn't for everyone. Then the internet kind of said information should be for everyone. If you want to learn something, you should use something called a search engine. You can go to something like Wikipedia, which had an encyclopedia, all the knowledge in the world. If Wikipedia was not specific enough, you could find out about a very niche topic. It democratized access to information. Then you had the mobile phone, which said it's pretty unfair that a small number of people in the world can talk on the phone and afford to pay two dollars a minute speaking overseas. Communication should be more seamless. The mobile phone really revolutionized access to communication. Now if you wanted to talk for an hour with your friend, you don't have to worry about normal minutes. You could be on the other side of the world, you could send a video. It's completely democratized. Digital assets provide the same opportunity. At the moment, a small minority of people have difficulty in raising financing. They basically are investors, they start companies, but most of society are not able to capture that value. They don't have the ability to own things or own a piece of a project by investing in it, or be able to receive the resources to fund it. What we're really excited for is an economy where people just don't have to worry about money as much, and the concept and experience of value is radically different. We're pretty confident that through the token economy, people are just going to experience money in the same way, or they're not going to think about value the same way, just because there's going to be so much more flowing around. How does that work? If you think about something like Uber, if you were the first Uber driver, you got paid 15 an hour, 20 an hour. But then when Uber became really big, you didn't get any of the upside. You didn't get any of the value that was created by something like Uber. Why was that? It's just because a lot of these companies, when they're created, it's not easy to distribute the value to all of the different stakeholders and people who were instrumental for the success. What we're excited for is when tokens become much more available and accessible, then value is just going to be distributed much more effectively. One major takeaway I think is try and find a way how you can apply tokens into your local community. All of you guys are bringing people together who are interested or curious, or who you'd like to give a head start to this token economy. I don't necessarily recommend investing or trading in coins or tokens, playing with exchanges, or leveraging trading. I would recommend trying to learn about it and trying to see how you can apply traditional real-world cases and assets and bring it into the token economy. I also recommend getting involved and participating in one of the initiatives that we have to offer. There's a 15-week badge for a master's program. We have study groups all around the world. I would highly recommend everyone organizing a local study group, as well as trying to engage a local community. We're really looking for ambassadors and leaders to bring this new technology to the forefront. You can also think of it like a country. Creating a token is like building your own nation. We're going to look back at this point in society and go, wow, it's crazy that people are working so hard for a piece of paper. They cut down trees, they put some ink on it, and that is what people are working for. The idea of a passport, you're born in a place, you get this book, they put some ink on it, and that defines your identity. What is this book telling you? That book is telling you that inside these imaginary lines, this is your group of people. We're going to look back at that and go, wow, it's so divisive, splitting people apart. Internet nations are really going to supersede this. If you look at something like Bitcoin, or Ethereum, or Polkadot, or Unit Network, or Unit as a technology, these are effectively groups of people who have a common goal and interest. You could say that if you hold one DOT or you hold one Unit, you're effectively a citizen of this internet nation. You might think, okay, that's kind of ridiculous. How would these internet nations compete with the big powerful governments? Well, I think one quote I like to think about is that people underestimate how much can be done over 10 years and they overestimate how much can be done in a year. 10 years ago, the mobile phone was coming about. Who was buying mobile phones? It was people, nerds and geeks sleeping outside the Apple Store. It was really expensive. Everyone had a Nokia. Nokia doesn't even produce phones anymore. It was like, who's going to be able to afford an iPhone? It's going to be the people who have lots of money or people who like to show off by having the new iPhone. Now, most people in the world have a smartphone. It's just so much more accessible and available to have a smartphone. Crypto currencies, digital assets, blockchain is not even at the iPhone moment. We're still at the Nokia, we're still at the Blackberry stage. I'm really excited because I think Unit can be the iPhone moment. We can be what brings the token economy to the real world and just makes it so easy for people to actually appreciate the benefits of this technology. If someone starts a local business, they can create a token and get everybody in the community motivated and incentivized to support that restaurant or business. I'd love to see how we could bring forward this knowledge and this technology to support the long tail of builders and people.

One thing I hadn't mentioned was within Unit we have a bunch of community features. When you create a token, we've got the overview which gives you insight into who the biggest holders are of that token. You can add team members, you can add advisors. You can see how much money is in the bank and treasury. You can invite people to the token. You can also use a bunch of the community features. What does that mean? Basically, you can create a poll and you could say, what should we do? Ask a decision to your community, ask your token holders, should we be open on a Sunday? Then you can set yes, no, maybe. Another option: what day should we host the meetups at our restaurant? Then the people who hold those tokens can vote on it. That's the poll feature. The contest feature: you can offer to give away a prize, let's say 100 Unit Masters demo tokens to two winners. You can say that the contest is create a video talking about why you love the Unit Masters. When you create the contest, when people submit the videos, that's how you distribute. You focus on the people, you incentivize behavior. You can also organize an event. You set date and time and bring together the community of token holders through that. You can create groups. We can set up ranks. Basically, say if you hold this many tokens, you are this rank. It's a fun way of gamifying this token economy. You can also set up a store to sell products and services. You can post a link and a title, kind of like if you've heard of Reddit. It's like a mini subreddit for your own token. You can post status updates. These are some of the exciting things that we're working on within the Unit Network. Another really cool thing is the vaults. How the vaults work is they are a way of distributing the value in the network. At the moment, if you think about something like Binance, or wrapped Bitcoin, or Coinbase, you're having to trust a small number of people to hold all the value. When you deposit on Binance, you're like, I hope Binance gives me this money back. Same with FTX. I was one of the first users of FTX. Sam used to help me with customer support there. It was so disappointing. They really let a lot of people down. The problem is the systems were built where you needed to trust, and it really should move to a trust-free system where you can verify. You don't have to hope that things are so. Decentralized exchanges are going to be really exciting. The other cool thing is with the vaults, it basically decentralizes the underlying funds on the network. Instead of sending money to a company or an entity and trusting that they're going to help you get back the tokens, the vaults really decentralize and distribute it. The other thing to think about is sponsor bridging. At the moment, blockchains are very fragmented. You've got Bitcoin, Ethereum, Matic, all of these things, and they don't interact well with each other. People need to use centralized exchanges. We're really excited for where bridges become decentralized. How we approach that is there are basically two ways to do bridges. The first one is called wrapped Bitcoin. If you Google WBTC or wrapped Bitcoin, you'll see that the wrapped Bitcoin token is a way of using Bitcoin on Ethereum. But the issue with that is all of the Bitcoin is being held by what's called a custody provider. You're kind of hoping that when you give them the Bitcoin, they're going to take care of it. They give you an ERC20 version, a tokenized version of that Bitcoin on Ethereum. When you give them back this WBTC, this wrapped Bitcoin, you're going to get back the Bitcoin. What the vaults do within Unit is to decentralize and distribute that risk where it isn't a single entity that holds all of the value. It gets distributed to many entities.

Let me answer a few questions here. Is the Unit token listed on any exchanges or DEXs? Not at the moment. We will be soon. We're built on this protocol called Polkadot and Substrate, which doesn't yet support many DEXs, but it's coming soon. Also, the way we view centralized exchanges is they're highly corrupt and there's a lot of wash trading. We basically want to drive trading value on our exchange and have it done in a decentralized way, just so that people can verify and really see what's going on. When you do trades on Unit, you can see who the buyers and sellers are. It's much more transparent, so you don't get fake wash trading. But I think it's really just a matter of time before that. From Javera: being able to token economy, what other sources can we learn and start a local business using token economy? I would recommend maybe one business to start is when the internet got created, people created website development businesses. It basically allowed the internet to form, allowed the web to be created. We think that a big opportunity is a token agency. If someone wants to create a token, we think there's a big opportunity in helping people launch tokens, helping people get educated, learning about how wallets work, making sure that people are protected. How do you compare the value of tokens? At the moment, we think tokens are highly speculative. There's a lot of opacity, not very transparent. We think that the treasury is going to play a really big role there. How the treasury plays a big role is it's going to be very clear what the underlying tokens are worth. If you think about most coins at the moment, they are based on speculative value. There's a lack of underlying value. When this treasury value gets established, you'll be able to tell how much value this token is able to add to its treasury on a daily basis, on a weekly basis. That gives you an idea of how valuable a token should be based on the amount of underlying value that gets created. Cool. A question here from Ezekiel: does the community define the use case of a token, or the token which defines the use case? That's a good question. I would say it's a combination of the two. I think people create a community or business, and then the token will represent the value of that. You can think of it like a better version of shares, or you can think of it like a decentralized version of stocks. But it's very important to understand what the underlying value is for that token. David's got a great point here. Unit has been on the Polkadot ecosystem, inspiration of the Web3 Foundation. There's a really cool event called Dot Safari. I'm excited to be attending, and many of our team members will be there too. So look forward to seeing some of the community there. Point here from Moma: apart from learning the blockchain, what can we fully get involved in this project? Great question. We organize lots of conferences live and online. We're also present at many of the major conferences globally. We have a ventures program. After you finish the master's program, you can apply to our ventures program where we support you in launching a token. It's completely free, like our master's program. Our goal here is to build the biggest accelerator and incubator for token-based projects. If you want to launch a token, you would join the ventures program. We'll help you launch it. If it needs financing, we can help you with that. We just want lots of really good case studies and examples of things which use tokens. We also have a university wing which is writing research reports, and a news wing which is focused on publishing articles. Those are a few. Is every coin has its own blockchain, or is there a main blockchain every transaction goes through? That's a great question. The way we look at it is crypto, blockchain, tokens are just so early at the moment where people are still thinking about the blockchain aspect. We're really excited for a future where the blockchain piece people don't even know or think about. If you think about the cables that power our conversation at the moment, the cables that sit under the ocean, nobody really needs to understand how well these cables are operating, how TCP/IP works, how this platform which we're using functions. People just care about the use of it. They care about the problems it's solving, the opportunities it provides. We see the same thing with tokens. A lot of technology will be powered by blockchains in a decentralized way. It'll be much more transparent. It's really just a matter of time before we get to that stage where you don't need to trust these smaller people. You can basically rely on the truth. Cool. The class has a point: did not understand the treasury concept, how it values tokens. How does that work? That's a great point. Basically, all coins at the moment are entirely speculatively based in terms of their pricing. You buy a coin for ten dollars, it could drop to a dollar, it could drop to 50 cents, it could go up to 200. There's no book value, no underlying value. What we basically say is there should be a way to tell what your risk is when you buy a coin or token. Let's say if you bought some Thompson token or some Oliver or some Chanel or Sambala, you should be able to know that if you bought a dollar of it, there's 50 cents in the treasury, there's 50 cents of underlying value that's backing up the token. As an example, say that there's a token of 100 supply and there's 500 worth of DOTs or Unit or Bitcoin in the treasury. You know that the lowest price is five dollars. That means that it could be trading at 12 or 15, but it's not going to drop below this five dollar mark. If there's an additional 200 which goes in, now that's 500 plus 200 which is 700. Now the lowest price becomes seven dollars. It basically gives you an indicator of underlying value and it provides a way for people to understand what is the underlying value behind the token. We think every single business or project will have that. Great question: how does it get value? You need to convert that revenue into digital assets, so Bitcoin, DOT, Solana, BNB. We support 15 assets, and that is what backs up these tokens in the treasury. I can post my LinkedIn here, I'll post my Twitter handle. Please feel free to reach out. I'd love to find a way to team up and synchronize with everyone here. It's amazing how much this community has grown, and we're really excited to see how we can take it to the next level. I really appreciate everyone. Does anyone have any other questions or feedback or thoughts? What is required for one to create and launch a coin and be generally accepted? That's a great point. I would recommend using the Unit Network platform. We think it's the simplest way to create a token or coin. You can post a link here too. We think that this process of creating a coin or token is just going to be much more commonplace. If you have an idea for a project, or you have a friend who is a talent, a musician or football player, they're going to have a coin and you're going to support them in their craft and partake in their upside. Cool. Maybe one or two more questions and I guess we can wrap up around 40 minutes. I just want to be respectful of everyone's time. Maxwell: explain the difference between a token and a DAO. That's a great question. First is a coin. A coin typically has its own blockchain. You can think about something like Bitcoin as a coin, Ethereum is a coin, Solana, BNB, Polkadot, these are coins. DOT is a coin. Then you can think of something which is built on a blockchain as a token. If you think of USDT, USDC, these are tokens because they don't have their own blockchain. If you think of Unit, that's a coin. You can think of the tokens that get issued on Unit, those are effectively tokens. They're not coins because they don't need to worry about securing their own blockchain. They're not a layer zero blockchain or layer one blockchain. Then the concept of a DAO, a decentralized autonomous organization, it's really a spectrum. You can think of Bitcoin as a DAO. You can think of Ethereum as a DAO. It's decentralized, it's an organization, it's a group of people, it's got a common mission. It's autonomous, meaning it runs by itself. You don't need to have a board of directors, you don't need to have a CEO, you don't have to have a payroll, you don't have to have a company which files annual returns every year. It's self-running, it's autonomous, and it's decentralized. That's a very important aspect. It's not one person or three people that control it. It's many, many. It's arguably decentralized from the technology aspect. It's really a spectrum. I think you can think of Bitcoin as being very decentralized. It doesn't have a leader or a spokesperson that's pushing for it. You can say that Ethereum is decentralized. People can say Ethereum is also not decentralized because of the Ethereum Foundation and Vitalik as a leader. But it's really a spectrum. I would think that a lot of companies which are very centralized will move towards being DAOs. Part of the mission behind Unit is to really bring about that shift. Sentient is saying: when we talk about consensus in a tokenized community, in the current time where sustainability, proof of work consensus is having a negative environment, is Unit Masters working towards a proof of stake which is more sustainable? Absolutely. Unit as a blockchain is powered by the Polkadot Network, which uses delegated proof of stake, which is much more environmentally friendly, much more scalable. I think it's also much more decentralized. We think the environmental piece is super, super important. Liris has a good point: we've been talking about the value of tokens, what about the issue of liquidity? The cool thing is that if a token has value, then it will be much more liquid. If people can see, wow, there's a real business, there's real operations going on, the lowest price of the token goes up, it increases in providing more security to its token holders, then people are going to put tokens into what's called the liquidity pool in the exchange, and that's what's going to provide trading liquidity. Question from Bala: explain the term liquidity. What liquidity basically means is, let's say if you made a Bala token and I wanted to buy some Bala token, and then I want to sell it, I want to buy it back again. Is there enough people that are buying and selling it to make it liquid? You can think of liquids and solids. Solids don't move around too much, while liquid, something like water, moves around. If the Bala token is liquid, it means that I can buy it, I can sell it, I can trade it. If it's illiquid, you've got a lot of coins which have no liquidity. It basically means if you buy some, you probably can't sell it. People say buying a house is illiquid. If you buy a house, you pay for the house, you hold it, you own the house, you got this piece of paper saying you own the house. It's not very liquid. You can't just say tomorrow I want to sell the house and someone will buy it like that. You need to go to a real estate agent, you need to advertise. Someone maybe a few weeks, days, or months later will say, hey, I want to buy the house. That's illiquid. But if you've got some Bitcoin or Apple stock, it's very liquid because many people are buying, selling, and trading it. Cool. Thank you so much. Kryptons, I really appreciate your words. Isn't proof of stake more centralized? That's one criticism because some people say the people who stake on the proof of stake networks, the people who provide the validation, the security, the decentralization for the network, are the ones who have the money. But you need to have the money to stake tokens to provide these miners or validators. The issue though with proof of work is it's also very centralized. Not many people can afford the computers, they can buy mining farms. They both go hand in hand. I'm excited for a future where everybody can become a miner or validator of their computer. I really think it's just a matter of time. Can one have a session separately to show ideas that we can both work on top of Unit? I think that's a good idea. If you reach out to our master's team, also talk to our ventures team. We also have a city team that we're trying to build up ambassadors and organize local events. So that's a really good idea, Maxwell. The next question: can something like FTX happen to Binance someday? That's a great question. The way to think about it is that if it can happen, it probably will happen. So you just need to be prepared for it. As I mentioned before, I was one of the first users of FTX. I've done lots and lots of trading on there, but I never left any money on the exchange. Every time I put money on an exchange, I'm thinking, okay, there is a big risk in leaving it on the exchange, and I'll take it off as soon as possible. If I'm trading a large amount of money, I won't put a deposit, trade it all at once, and then take it off. I'll do small amounts just to make sure that it's... It's called counterparty risk. Counterparty risk is the risk by which when you work with something like an exchange, you might lose whatever you're working with. Really unfortunate about FTX. I really hope that our industry learns and we move from working with centralized exchanges to decentralized exchanges. Question from Mehar: what does an ideal tokenomics look like? I would say one which is very simple. Ones which are overly complicated are actually bad. A lot of people think the more complicated you make it, the better the economics is. I think it should be easy to explain. I think there should be an underlying product or service. It shouldn't just depend on new investors or token holders coming in to keep up the price. It should be very clear what the underlying product and service being offered is, and it should be profitable. If let's say at a restaurant or chain of restaurants, and I created a token for my restaurant, it's important that I'm not losing money on every plate of food. If I launch a nightclub or a membership club, I want to have membership fees which generate revenue which support the underlying token value, not just have it based on speculation. How does an ideal service... You'll learn about it in module five. I really appreciate everyone's patience. The value of some tokens determined by the value of gold and the number of patrons join. How about the Unit Masters one? The interesting thing about gold is that it's like Bitcoin, Ethereum, Polkadot. It's a reserve asset, but it's really tough to move around and it's potentially slightly more illiquid. If you had a bar of gold somewhere, it's not as easy potentially to sell that bar of gold as it is to sell digital assets. What does IOU mean? I'm not so familiar. IOUs usually you owe someone, but in this context, I'm not sure. Will you be offering the courageous service for community service or projects? Potentially. Your best is to speak to our ventures team. We're working hard on providing a bunch of services and value to the community in a decentralized way. Will this teaching lead to blockchain and Web3 programming? Most definitely. We will be launching a course teaching people how to build blockchains and smart contracts. That's coming soon. Mariana says: don't you think that mining farms are still too unsustainable? I do think so. People think Bitcoin is the biggest coin, it's going to be around for however long, but I really think of it like Nokia. It was the first. It was like Yahoo. As big as it is, there will be things that replace it. I'm a big believer in Bitcoin and an early supporter and investor in it, but I do think there will be bigger and better. What's your say on crypto and DFS regulation? Good question. I think regulators are really struggling to understand what this technology does and doesn't do. I think first it's important to understand, and then it is to regulate. If you regulate without understanding, then it's not good for the technology, the people, or the ecosystem. Overall, I think the regulation might get tougher in the short run, but in the long run, this technology is really going to do so much good for the world. It's not about if this is going to happen, but when. A question: what's the difference between token and NFT? Very similar. You could say a token is a fungible token, and NFT is a non-fungible token. If you created five NFTs, each of them will have an addition like number one, number two, number three, number four, number five. A token, if you've created five tokens, there isn't token number one, two, three, four, five. They're tradable, they're much more liquid. Cool. We've got two minutes, so I'll try to answer two or three more questions. Please share with us what qualifies someone to be an ambassador so you can work towards it. That's a great question, Maxwell. I think most important is enthusiasm and attitude, and a take initiative. If you reach out to our master's team, that connects you to our city team. We'll be organizing lots of city events and gatherings. I'd love to see how we can get this grassroots movement moving significantly forward. We're also working with the Polkadot treasury, so we'll be teaching everyone lots more about how to use Polk.js, how to stake DOT, how to understand what a parachain is, things like that. We're really excited about this technology as well as participating in this token economy. Question from Sanjit: when we talk about DAOs, do you think that the future will be subjected to tax? How can we determine value where there's no exchange rate or comparable available? Do we define comparable as a community? If the DAO is used for something criminal, are the consumers liable for it even if not the one who created the activity? This is a huge question mark. It's really unclear how taxation and regulation will work. I do think it will be seamlessly integrated the same way when newspapers were displaced by the internet. People weren't sure how the New York Times, The Washington Post, the Financial Times would integrate with the internet, but then they just launched digital versions of their newspapers. You can say the same about taxation, regulation, and enforcement. I do think it will flow nicely together. I like to think of tokens as effectively digital shares or digital companies. I think that's a really cool way to think about it. Is the value of the NFT decided by the seller or something people bid on? That's a good question. It's actually decided kind of by both because the seller says what their price is, and then people are agreeing or disagreeing to buy at that price. If you go into something like OpenSea, you'll be able to see what the floor price is, which basically means that is the lowest price that you can pay to buy this NFT. CC's got a question: regulate first or understand first? As a question, regulate first, understand later. The tricky thing about regulating first and understanding later is you might not do the right regulation. You might do things which actually hurt this innovation. You might stagnate it for a while. I do think it's important before doing an action to really understand what are the implications of the action. Moshido: where do you recommend we keep coins off exchanges if not exchange like FTX? I would recommend a cold wallet, something like a Ledger or Trezor, or something like Exodus. These are really good self-custody wallets. I don't recommend using exchanges or platforms which hold your keys or crypto. There is no point. White shark seems to be the culprit dictating the ups and downs of specific cryptocurrency. Is there any way to address the issue of white shark determined buying and selling that throws away the small fish? I think as this industry becomes bigger, it's going to be much tougher for individual people to affect and to dictate how well markets perform. We're just so early and small. If you think about the whole blockchain industry, it's under a trillion in valuation, which is more than Google or Apple or Facebook. It's really small. It's got so much growth and future to come. Point here from Mehar: after regulations are in place, will the blockchains be centralized? I do think we'll get both, but I do think it will move towards a point of decentralization because the problem with centralized things is they will end up being corrupt. There's a nice phrase: absolute power corrupts absolutely. If there is power in a centralized group, it will become corrupted. We can't afford for disruptions to become so. You'll also learn more about this in module two. Because the DAO is another organization structure, there'll be no difference in taxes or regulation. That's correct. I do think if it is decentralized, like the internet isn't a company and it doesn't pay tax, it is effectively a decentralized technology. I do think things like Bitcoin, Polkadot might not be taxed like a company because of their decentralized nature, like a technology. It's been really enjoyable. I look forward to keeping in touch with the community. I really hope to see how we can work together to see how this match and community can be involved in this token economy. I really think it's such an exciting journey ahead. I'd love to be involved in support and have everyone support here in helping build up the mission of the token economy. Thank you so much everyone. Look forward to keeping in touch. Please feel free to message and reach out. Thank you.