Coinbase Alumni Roundtable Hosted by Fred Ehrsam

Intern ended up working across the product, or helped lead and start USDC. Coinbase today, one of the co-founders of Zora. We think we can build a new internet based on NFTs. I'm Dee, I'm one of the other co-founders at Zora. I spent November 2017 through about March or April 2020 at Coinbase. Started as an auditor, wound up as a program manager, and eventually led the influencer marketing program on the comms team. So as a bit of a jack of all trades.

Hey, I'm Antonio. I was at Coinbase from 2015 to 2016 when I was a member of the payments team on the software engineering side. Currently I'm the founder of dYdX, which is a decentralized exchange for advanced... then later was a product manager for internal tools. I co-founded a crypto fund called Scalar Capital and just really excited about investing in different exciting crypto projects.

I joined Coinbase as a design intern. So I was coming over for what I thought was going to be three months. I was building and messing around with projects on Ethereum in my final year of college, and I was very active on Twitter about it. I think that's how I came across the radar of a couple of folks at Coinbase who just DM'd me being like, 'Hey, we like what you're doing. This is cool. You want to come over to San Francisco for three months?' And I was like, 'Yeah, that sounds fun. I'll do that.' I told my family, my girlfriend, my friends, I was like, 'I'll see you in like... where did the idea originate? I wanted to join Coinbase in the first place because I read one of your blog posts very early on. You were kind of charting the territory of early decentralized business models. I was trying to build DAOs at the time. I was like, 'Oh, this just seems like an amazing way to collaborate and create with people online.' And what you wrote kind of resonated with me. So I was trying to do my own thing, and when I actually first got the DM from Ben Jennings, who was the head of design at the time, I think I said, 'No, I'm all good. I want to do my own startup, I'm doing my own thing.' And then I kind of saw your blog post and I was like, 'Well, if I was going to work in crypto, Coinbase seems pretty interesting. Very strong brand, cool product.' I was like, 'All right, I'll... right out of college.'

Yeah, especially at Princeton, I guess. Everybody went to Goldman Sachs or Google and stuff like that.

Yeah, I probably have a really different story than everybody else actually. Because honestly, I didn't understand Bitcoin when I accepted the offer. Honest about it. No, but like, I heard Fred Wilson came and talked... The reason I joined was because Coinbase used to do a work trial as you guys know, which is basically the last part of the interview process. I did my on-site and then the recruiter was like, 'Hey, do you want to come and fly out to San Francisco and work with us for a week?' And I was like, 'I have school.' But luckily, I was a bad student and I didn't go to class too much anyway, so I peaced out on class for a week and went out to San Francisco. You guys put me in a nice hotel and stuff. But most importantly, I got to meet a lot of really great people while I was there and really fortunate to still have those great relationships to this day. I was like, 'Wow, there's all these amazing, smart people at this company.'

I know I was... money laundering through PayPal? In jail? Fairly intimidating guy, very intimidating. And then I obviously intersected the company a bit later in history. And I remember it was like two in the morning, I was doing a work paper for KPMG by myself in the office testing audit controls, which is just watching paint dry. It was absolutely horrible. And I was like, 'Man, I can't do this anymore.' And I logged into LinkedIn and there was a risk management specialist posting for Coinbase and it was like six days old. I was like, 'Oh man, this is amazing.' I was one of the first 10 people to apply. So instead of applying, I just DM'd the recruiter, Brett, and I was like, 'Hey man, my name's Dee. I wrote this white paper at KPMG that got published about blockchains. I've been using Coinbase for ages. How do I apply? What can I... I was actually working on a client for KPMG in New York that was building securities trading for the Hong Kong stock trading, something crazy. So I was flying back and forth between New York and San Francisco for all of my Coinbase interviews, including my presentation. And I remember being like, 'Man, this is the most grueling interview process I've ever been through. If I don't get this, this is just some trash. I'm flying back and forth, this is ridiculous.' And then I remember walking out, flying back to New York. I had just left Dover Street Market, I was feeling myself, I had the Supreme jacket on. I called my mom and I was like, 'Mom, yo, if I get this job, it's going to change my life.' And here I am walking around the street, I was like, 'Yo, Bitcoin is the future.' And she was like, 'What? World currency?' The whole thing. It was hilarious and then you're like, 'Hold on, your mom... man, I think you actually did it. You got the job. We want to make you the offer.' I was looking at my jacket, I was like, 'This is the moment.' It felt great.

Well, what's transpired since is that we've now gone on another meteoric rise for Bitcoin and this bull run is insane. Looking back on it, I remember walking into Coinbase for the first time and being like, 'Wow, that was my first experience of a tech company.' But it felt like everything that crypto was at that moment. There was this hustle and bustle and energy and it was booming. I remember when I accepted the offer, just looking back at KPMG, like, 'Haha.' But I was like, 'Well... pretty crazy.

So I definitely never wanted to start a company ever. I was like, 'I'm going to work at a big corporation, work my way up.' Coinbase was the biggest risk for me, so starting a company was just not something I was going to do. And just the amount of really talented people at Coinbase who were leaving to start their own thing, or the sense of ownership and responsibility that Coinbase gave, just really kind of put that idea in my head. In late 2017, when just the amount of interest in crypto was happening and I was spending all my spare time researching crypto, I was like, 'This would be really fun to just get to dive in full time.'

I think before I joined, I straight up told you and Brian in the interview, 'Look, I want to start my own company someday.' And I thought the best way to be able to do that was not to just do it right after college. That could work, but I felt like I needed to work at a really great company and I felt like that could be Coinbase. And it really was. I've gotten so much learning, value, and great connections out of that. So it worked out better than my wildest dreams. But yeah, day one, or before day one, I was just like, 'Brian, I want to start a company.' And he was like, 'Great, that's awesome. I'm excited about that. Let's think about how we can help you do that.' And that is just the... five, five percent.

We frame this entire moment as we're entering into an internet renaissance. That's kind of the phase we think we're heading into. And we're really specific in that choice of words because the kind of world we're trying to help build out with NFTs is basically... I think crypto is associated with disrupting the financial system. I think that's the starting state of crypto, not the end state. Disrupting finance is like, 'Okay, great, now we have a new way which we can create any value system that we'd like, work together on our own terms, do that all natively on the internet. Now what?' I think it's like, 'Okay, Wall Street? Cool, that is now an accessible... there are huge walled gardens that have been built out over the past 20 years and they define how we create and operate on the internet. And I think now crypto is starting to eat into that, or kind of knock on those walls and go, 'Well, hang on a second. What if we can take the power of social media and instead of that being owned and controlled by these huge corporations, what if we can now start to create these new systems for ourselves, create new mediums for ourselves, and have the value and everything as part of that kind of open up.' So we're at day zero of that. I think we've only just kind of woken up to the fact that we have this amazing financial toolkit, this value toolkit. 'Okay, how does that start to...'

Yeah, dYdX is a decentralized exchange and we focus on more advanced financial products and specifically derivatives. I've been building that out for the past three and a half years now.

Yeah, definitely. I think there are three main aspects where DeFi is important. And you kind of have to realize the backdrop of how crypto started in terms of centralized exchanges and that's why we're sitting here. But DeFi is really important for a couple of... days or it's still to this day. In crypto, 10 years later, it's like, 'Okay, you want to actually use crypto? Okay, give your keys over to Binance or Coinbase or whoever.' Kind of like almost lost the entire point. So just in DeFi, the biggest point is that you can truly own your own keys, you can truly own your own positions. Another really important part of it is transparency, and I think this is something that doesn't really exist in the traditional financial systems, where you can just have true auditability into the state of the overall health of the market. And this is especially important in derivative contracts where not only when you're trading a... and have it live on the blockchain, have it be open source, have it be accessible to more people in more places. And I think that's a really powerful thing. Finance itself hasn't really changed in a big way in the past 50 or 100 years. But now you can just kind of build this entirely parallel financial system, codifying everything into smart contracts. And that's a really powerful thing.

I remember just thinking, 'Wow, this is a pretty nice desk.' I was just really geeking out on the environment. I had my backpack on. I'm like, 'I'm an intern. This is going to be great.' I remember being shocked of being like, 'Hey, so we want to completely redesign the entire mobile app... into the skeleton of what the app is today.' And I remember one of the great things about Coinbase is that they are really good at empowering one, finding very interesting or non-normal talent. People are just kind of found in the corners of subreddits or Twitter or all these weird wacky places on the internet, bringing them into Coinbase, and then just empowering them with these crazy ambitious projects and assuming and trusting that you can just figure it out. So in my first three to six months going from intern to joining full-time, it was like, 'Yeah, okay, literally just help redesign the app that millions of people use every day,' working directly with Brian, working with all these incredible engineers and people across the whole company.

At that point in time, I was getting very deep into early decentralized exchanges. I got so deep into it to the point where if I get passionate about something, I don't shut up about it. And I wasn't shutting up about how we should get into decentralized exchanges. I remember the leadership team was like, 'Okay, just let us, you can pitch it one time and then we'll hear you out.' That ended up leading to the acquisition of the Paradex team, which was a fun experience. After Paradex, I was the founding PM of USDC. So I got to work with the amazing team at Circle and helped bring the USDC stablecoin into fruition. A couple billion dollars of that stablecoin outstanding today. Now I think it's over 10 billion dollars now, which is... my favorite project I worked on at Coinbase for sure.

My favorite was definitely the first key generation ceremony. I felt like I was in some cross between crypto meets Mr. Robot meets the ultimate adrenaline rush. I remember being in the office at like 11 PM and literally hearing Zach, who was the crypto engineer at the time, playing the Mr. Robot theme song, doing a dry run. We were packing all the bags that we had to take to this undisclosed location. We were all in three different Suburbans. It was insane. We set up a Faraday cage in an apartment, ripped the Wi-Fi out. And I remember being in this tent with no Wi-Fi, no cell signal for like six or seven hours, listening to stories from Julian Bourie, one of the early security engineers. It was just insane. And for me, it will go into your brain. Neuralink? Yes, insane. That was definitely the most core to Coinbase in my early tenure. I felt like I was actually contributing to something that was really going to impact or matter to the company, and it was the first time I got to cross over into the real crypto inside of things. I was like, 'Oh man, this is the team that's actually building the systems that I use every day.' Which is pretty dope.

Yeah, any reflections from that period? I joined mid-2014 and the price of Bitcoin was $600 around there, and then it crashed to $200 for like a... come back to finance. So I remember that was a weird time. But internally, I didn't feel that at all. There was so much excitement. Every time you talked to someone, they were super passionate about Bitcoin, really saw the future of what this could be. Back then, it was a lot of focus on merchant adoption and how Bitcoin was peer-to-peer cash and it would be really cheap and instant. I remember that huge onboarding of all these giant named merchants, and I thought that was really cool. But over time, Bitcoin's narrative progressed into digital gold, so that was a very different shift in focus. And that was definitely wrong in retrospect.

Yeah, people there were crazy, super interesting, talking about DAOs and all these things at the time. We both got super deep down that rabbit hole, and I just remember thinking that was a really different moment. I was really excited when Ethereum got added. I might not be the whole crypto anarchist side, but I do think that traditional finance will still exist, but I think that a lot of people who are excluded from the system will be able to participate in this open financial system. I think people will be able to get loans through DeFi and not have to send all this paperwork over to a bank and then get denied after a one-month process.

I guess there's two things. Coinbase, my favorite product there is USDC because it's taking all the powerful things of Coinbase and very meaningfully bringing it into DeFi. It's like, 'Well, you literally have a... in DeFi, it's like Uniswap, which has a weird history as to why these socks are tied to it. Uniswap is fascinating because it is the spiritual successor to Coinbase in a lot of ways because it's an exchange but it's community-owned, it's entirely permissionless and protocol-based. Any developer on the planet can get the power of the New York Stock Exchange or Coinbase with a single function call in about 12 seconds, depending on gas price. Uniswap to me actually feels like the progression of... it moves us away from what money itself is. Currency is a medium of exchange. What is Uniswap? The function will just go, 'Well, this is the real-time price between these two things.' If you think about why money was invented in the first place, bartering was hard. What is the real-time price between this loaf of bread and this bunch of rocks I need to build my house? You can't figure that out. Money served as the medium of exchange. Uniswap is like, 'Well, what is kind of liquid?' This was not why it was created, but I think it's where it's taking us. Now you can have a literal medium of exchange between any two tokens, and those tokens can represent physical objects like a pair of socks that was tokenized. These socks, there were only 500 created. You need to buy this socks token, you redeem it (burn it), and you get a real pair of socks shipped to your house. What that means is kind of crazy because you have the...

Unfortunately, I've worn my Unisocks too. Regrettable.

I feel the same way. I thought there was no way in hell. Everything prior in crypto has grown out of the existing crypto user base. Then all of a sudden, the crypto insider community had this funny moment where it was like, 'Wait a second, it turns out that not that many people are interested in this weird new idea of money. It turns out everybody's interested in art and culture. That's literally the whole population.' There's been this funny inflow. Linda, I saw you shaking your head.

Yeah, well, I think I was too early. I was super excited by NFTs and I was like, 'Everyone's going to collect these in-game items. They're going to be swapping them, wearing them with skins, I'm going to be displaying them in VR.' I was kind of way too ahead of it, and it took like... cool things you can do, especially virtual lands, like owning and developing real estate in virtual lands. That's so cool. And being able to rent out your items to other people. I just think there's so much design possibility there. I'm really bullish on that space. With NFTs and where we're headed with this whole explosion of NFTs and ownership, it's like now you can be your own publishing house, your own gallery, your own marketplace. It's really an extension of the spiritual philosophy that powered Bitcoin in the first place. It's just now the 'be your own fill in the blank' happens to intersect with media and culture. So NFTs are really a genuine paradigm shift in owning information, owning media on the internet itself. That's turning into the atomic unit of the internet in a lot of ways.

To make money from this blog post or from this video, you had to put it in a walled garden built out of advertising or subscription or pay-per-view. The paradox was to build a walled garden that fit every single person in the world inside of it, which is kind of the social media platforms we see today. And it was mostly those platforms that would capture the value from it. You post for free on Instagram, you get paid in likes and followers, but the advertising revenue goes to the platform. If you're big enough, maybe you get pennies on the dollar, but that's a very select few people. With NFTs, it's the complete inversion. You can make that piece of information and media entirely free, universally accessible to the internet, but still own it as an asset and capture that value. Which is probably much more in line with... on crypto, if you will, in many ways. That first chapter was hyper-financial, but now the second chapter looks like it can be much more about the truly open internet. First it was open finance, ownership, value. Now it's just open information, open publishing, open media, which really widens the top of the funnel in a lot of ways. I think that's exciting for the second chapter. As we close this first one, what's next for Bitcoin? It's sovereign wealth funds, public balance sheets, real government acceptance. That's the last frontier there. Once we conquer that, what does it look like for the broader internet? It's a lot of what Jacob was saying: social media, the way we interact with one another on a daily basis outside of just a Venmo, but much...

Things like DAOs and forms of organization with people of the world that are anonymous, I think they can totally join that system, and there will be really popular groups formed around that. But otherwise, I'm really excited when this does get abstracted away. Everything's way more efficient, accessible, global. I think it's going to touch all types of industries, not just finance. It's hard to build a lot of these things from a technical perspective. It's hard to build network effects from zero. So it takes time. But if we're talking about 20 to 25 years from now, I think it's not unreasonable that we could have built, collectively in the space, an open financial system for the world. The ramifications and benefits of that are massive, and I'm excited to work on it.

Crypto as an ownership system and value system generally. I think what that means fundamentally is how do we work together? How do we decide what is valuable to create, to own, to work on? To sketch that at a high level, it's like any group of people, no matter where they are on the planet, if they share a common view or have an idea for what the world can be, there is this value system and toolkit which means they can congregate around that idea and work on that together. They can use the tools of finance to bring that capital together. It could be 10,000 people on Reddit or a mix of people on Twitter. If they have a shared idea of what the world can be, you can... of like some new crazy speculative area of science, or fund an education system, or literally whatever. You should be able to just create together on the internet and do whatever you want. It could just be you as an individual, but ideally if you have a crazy idea, there's probably a thousand people like you across the planet that have that same idea. And now you have a medium to work together and do that.