And thank you Sarah for organizing such a great event and for the audience here. Yat, it is so exciting to be here with you and talk about these specific topics. I feel like you have been through every single chapter that brought us here into this agentic world, into the new premise. Just before coming here on stage we actually talked about how gaming is intertwined into everything and you started your career at Atari, right?
That's right. Yeah. And it's great to be here again. Thank you for the invite. It's always wonderful to be here in Tokyo. You know, for me, the general way that I think about the space is that the last 30, 40 years, I mean, I started with Atari in the mid-80s, 1985, so it's been a while. And we always thought about how we enter the virtual reality of the world. People talk about the metaverse and talk about gaming and Japan is obviously a major gaming center. We spend a lot of time virtually, but I think now as we dive deeper, I think AI agents are kind of inverting that and the element of how basically we're going to have so many agents in the world doing stuff for us, actually extending from basically the virtual world into the physical world. And I think this is where the whole internet is basically changing into this new phase, you know, we like to call it Web 4, the agentic web. When you think about it, right? I don't know how many people in the audience are thinking they're going to be AI agents but the typical answer people give is three to five agents and I have 200 and I probably have a thousand by the end of the year. But simply put, typically more than the number of people that are online. That means we're going to have probably 30 to 50. We think it's going to be hundreds, but either way, it's going to be tens of billions of agents in the world roaming around doing stuff, where they're going to live, what they're going to do. And that will completely change basically the way that the web works. Today already we no longer are browsing the web like we used to. You know, if you're using probably Google, you're doing a search, you're basically getting the summary, and you no longer click through. So, if you are a traditional media website, your traffic is down 80%. That's the average number right now. So, how do you make money from that? It completely reshapes it. And I think the biggest shakeup we'll also see in things like online advertising.
How do you actually call it? Do you call it Web 4? Do you call it agentic web or?
Well, I mean, I think to us, we call it Web 4 as in it's the agentic web. So, for us, Web 3 was basically digital property rights. So, the web of ownership.
In Japan though, Web 3 got narrowed down and became synonymous with crypto. So it completely overshadowed everything else that it was supposed to.
Maybe, but I think when you use the term crypto, really what crypto is, is it's a form of, it's a ledger, right? And one of the things I love to tell people when they don't think about it too deeply is the civilization and history of writing is because of the ledger. So the ancient Sumerians invented writing to basically prove who owns the property in their cuneiform.
Back 5,000 years ago because you had to prove whose cow was it, whose house was it? Because if you couldn't prove ownership, you couldn't organize society, right? Like imagine if I couldn't prove any ownership, we would always fight over that ownership. So society could never become larger than 100 or 200 people. Like Dunbar's number was basically 150, right? And usually you had hunter-gatherer societies that only reached that size. When you started building actual cities and villages, you needed a way to prove that ownership so people don't fight over it and create order. And that was the beginning of society and writing was invented for that purpose. And so what is blockchain? It's basically a machine ledger. It's a distributed machine ledger that we can use to prove in a decentralized manner. Yes. But actually it's the ledger for machines. Right. So we needed Web 3 to get to Web 4 because in Web 3 we basically had blockchain infrastructure that 9 years ago when CryptoKitties launched, we were involved in CryptoKitties, a few million dollars of sales melted the blockchain, could do no transactions. And today because of stablecoins, because of basically Solana, Ethereum scaling solutions, trillions of dollars with BlackRock, Fidelity, Standard Chartered, all the big companies including our joint venture with Anchor, you know, on stablecoins, we can now basically do everything that banks can do on-chain. But this banking system is really we think more suited for agents. But the only way to make it work is that you have to prove that ownership, you have to have digital property rights and that's basically where AI agents can now prove that. So the agentic web becomes possible because of the foundation that's laid in Web 3.
Because the blockchain is immutable, it's verifiable, because basically you don't need like large memories on the premise of basically where the transaction is happening but it's available.
Correct. And I mean if I want to go a little further I would argue that we're hitting this new sort of era that might be a kind of agentic civilization which every phase so far has been human-centric but I think with Web 4 we're getting into something that becomes much more agent-centric.
Well it's so interesting that you talked about the start of civilization about the Sumerian cuneiform contracts basically for property ownership. Writing systems later also developed because of content, because of storytelling, because of all the little anecdotes from religion to whatnot that created a culture. And now they're all part of this content that we as humans take from one generation to another. And you at Animoca Brands, you built an empire on IP rights that also includes storytelling, games, characters, all of these things. How do you see the ownership now that agents, AI agents are taking the role? You know they might create a piece of new content, they might even negotiate a licensing deal for us. They will have an active role in this. Does this take the ownership away from humans or do we need to make sure that when we create these systems that human kind of role in it is deeply embedded and deeply understood by all players in the game.
Yeah. So I tend to be a technologist. So my view is that I think it's generally a net positive. So I think the, you know, I forgot the name of the German philosopher who termed the term for humans, he called us homo narrans basically saying that what really drives us is storytelling and we basically exist because of this whether it's society, religion, writing, whatever. And if you think about Japan just generally, I mean you are one of the world's best storytellers in the world whether it's manga, anime, film, music, whatever, right? And everything in your history as well and sort of just the pedigree that you have in this history is around that storytelling. It gives you that power and you have such a cohesive society because you have that storytelling power that exists, right? And culture is defined by the history and the depth of that storytelling. Now, what does it mean for agents? But for me, you know, in the same way that the internet helped distribute some of that out there, agents are going to distribute that much more pervasively. I think the problem we have in the world is not that AI agents will take your jobs. I don't think that's going to happen in the same way that the internet didn't take away jobs or that the industrial revolution didn't take away jobs. It changed jobs but there were more. It'll expand it. What will happen is that AI agents are going to discover ways in which you can do business in ways that you wouldn't know how to do before. So take programming. I mean programming in my view is going to go the way of Instagram with photos. I grew up in a time in the 80s and 90s where being a photographer was a job for only a small percentage of people and we said that for creators and we said that for movie makers and we said it for all these people and today because of AI agents actually everyone is a programmer. The only limitation is us as a human because when you go to someone here and say oh you can program now everyone's like no I don't, right? And that's what people used to say 30 years ago about photographers because the agent can program better than the human, right? And that's kind of where we're heading so that means you're going to have a billion people that can create code. Now imagine what you can do when you are creative, when you have ideas, but you couldn't execute and now your agent can do it for you, right? And that to me is actual sort of power. So then what becomes valuable is authenticity, right? I mean, we all can tell the difference between when something is AI generated, what we pay for isn't the fact that it is looking good. What we pay for is that it's coming from you or from you or from you. So the premium for authenticity which has always been the premium for trust and relationships right at the end of the day I want to have a relationship with you I don't want to have a relationship with 10 people around you I might talk to 10 people around you to get.
That's the role of blockchain that to verify this is basically coming from.
But how do you scale and prove essentially authenticity at scale both on the machine level and in a decentralized manner and that's basically blockchain. So digital identities, soulbound NFTs, these all sort of play a massive role. And just think about in the future in a relationship when you want to sort of say for celebrities you don't have to engage with the celebrity itself which is really just a visual representation you could sort of communicate through their agents. These agents are going to be able to sort of share things with you like in my case for instance when someone comes to Hong Kong I no longer have to basically go and send them a list of my favorite restaurants I literally just introduce them to my agent who can basically just say hey you know here's our favorite restaurants but it's constantly updated. And what's also interesting is feedback comes back. And so even though I'm not the one communicating because I don't scale, I'm actually building a kind of parasocial relationship with everyone else who's engaging through the agent in a more direct way than I'm doing when I'm basically just using an application or a piece of software.
And yet your companies are scaling and it's understandable you're a techno optimist of course because you know the feedback loop you have is always coming back with this is better and this is getting to a point where it's getting more and more amazing for all of us and it's contributing to bettering society. But I have to touch upon this because it's in the news right now, right? The layoffs with Meta, 8,000 people are being let go. Microsoft is giving voluntary packages. And it's very direct actually messaging from the leadership right now where they're saying that they're offsetting AI costs with actually reducing people. So we could say that roles of people are being used to pay for AI investment. And I just want to also add on that because you also mentioned industrial revolution. It was very much needed. That's why we're all here today. But after the industrial revolution, there were years of chaos where people were destroying machines because they were losing jobs and it was kind of especially during winter times for people who were working in agriculture and so on. We all know how this went on. So my question to you is, you know, I know it's an optimistic outlook for all of these things but do you think we need years of chaos before we get there or for people who are working in the field whether they're entry level right now whether they're CEOs whether they're investors what does this mean right now what does it signal for the next one to six months.
