Robinhood CEO: THIS Will Change the Future of Finance ft. Vlad Tenev

28:42I mean, they still do their 401k investment, but they seem to use excess cash to try and get ahead. And that's driving what you guys have seen in options. It's driving crypto. And when I speak to young people about it, it's like, oh, yeah, we don't have a choice. Do you think this is a persistent trend? And this is, you guys have started building in prediction markets as well. It feels like it's all part of the same thing. Yeah, I think the common theme there is just that investing itself and trading has become more accessible to people with smaller levels of assets. I mean, when I first started trading stocks, it was the dot-com boom.

29:29I think 1998, 1999, I was about to be a teenager. And of course, I spent a lot of time at home with a computer. So I had my Yahoo Finance fake money portfolio and I was doing quite well. And so my dad, who was not, you know, we were not wealthy at the time, but I think he wanted to encourage my interest. He's like, hey, this is amazing. You're doing really well with this fake portfolio. So he incentivized me to open up an E-Trade account and actually sort of like gave me a little bit to invest in. And back then it was$10 a trade. So, you know, with a hundred dollar E-Trade account, you were, you were basically out of luck.

30:17You couldn't make that many trades. You had to really be confident in that one stock to hold it for a long time. So it was very hard to be a trader with a small bankroll, right? And you get this sort of pejorative comment from, um, from, you know, people who are typically wealthy or say, well, that's not what these Robin Hood traders are doing is not good. That's not how you should be trading. You should be buying and holding. You should be Warren Buffett. Yeah. But the problem is, that's really a strategy for people that have a lot of money. If you have a large amount of money, let's say you have$5,$10 million or more, and you can make a 5 % return on that, you know, that's a significant, that's like money you can live off of, right?

31:07You're imagining, you know, you can make$250 ,000 a year if you have 5 million and you're generating a 5 % return. So you don't need to take that much risk. But if you have a smaller portfolio, if you're starting with, you know,$10 ,000, you know, 5 % return is, you know, not what these people are looking for. So they can't use the same strategy. And so I think inherently, the difference between investing and trading, you know, if you're wealthy, they call it investing. If you don't have as much money, it's trading. But what happens is there's people that are very, very good at trading. I mean, we've seen them born and kind of continue to excel on Robinhood.

31:56And, you know, these people are analyzing the crap out of everything. They're getting all the data, they're staying on top of trends, and they move with conviction, right? And, you know, it's sort of like, if you've got a big bankroll, you can succeed and you can generate income from your investment portfolio without spending a lot of time. But if you want to be a trader and you're going for those greater returns, you have to do a lot more. You have to work a lot harder to capture those ideas and to identify those trends. And I think that's become easier with our platform because it's possible now to start with small amounts of money.

32:38And I fundamentally believe trading is a skill, just like playing a musical instrument, you know, or playing a sport. You can get better by practice and by being in market more. And, you know, it's fundamentally, you're fundamentally limited by how much you can actually read passively in a book. It's like, imagine getting better at basketball by reading a book, you know, it's not going to happen. And I think you've fundamentally changed access to markets with what you did. And that you've got to take enormous credit for because they had no option apart from a 401k. E-Trade didn't want them. Nobody wanted them.

33:21And then you gave them access in a way that they understood and created a UX that was engaging for them. And what we've done is onboard, you've literally onboarded millions of millennials. Up until 2020, they weren't really active. And then suddenly, all at once, once given a check, they decided to become active. And it was an extraordinary thing. I'd kind of given up thinking they're never going to come into markets. And then suddenly they did. Well, yeah. I mean, 2019, I would say if I look pre-COVID at Robinhood, we had still built a sizable business much faster than anyone had predicted because we delivered great products.

34:06We forced the industry really to go to zero commissions. So the industry adopted our model and kind of took views from us about how this new wave of mobile first trading should look like, what the product should look like. And we, I think, crossed something like 10 million approved accounts in 2019. But, you know, at the end of the day, our traders are smart. Right. And they very clearly saw in 2020, right after the smoke cleared from the initial pandemic sort of like market turbulence. that the Fed and the government was very much doing everything they could to support the markets. And that became very, very clear with the stimulus and the different activities.

34:59And you could see on all of the threads, people were dissecting every move of the economy. And I think that increased the activity tremendously. I mean, you saw a lot of activity, but I don't think it was merely the fact that there was money helicoptered. That was a component of it. But people just became a lot smarter and they were paying attention to everything. Everyone became a full-time trader during that time period because that was one of the only ways you could earn supplemental income for quite a while. Yeah, and I think it's changed a lot of lives. How do you think about the success rate of the people coming onto the platform?

35:45Because a friend of mine ran a large business in the UK, IG Index, and that was one of the problems they always had was how do you get the success rate higher? How do you make sure that your community of members ends up making money? Yeah. Yeah, I think it's a great problem. We're trying to tackle it as best as we can. I think that in the U.S., the difficulty that we have to contend with is because we're a broker and up until recently haven't been a registered investment advisor, you're extremely limited into what you can actually do in terms of sort of like nudging customers toward particular products or recommending products to customers.

36:33So we had to be careful just to present the products as objectively as possible and not, you know, put our finger on the scale one way or another. But recently that changed. We rolled out a product called Robinhood Strategies, which is an RIA product. So we're a registered investment advisor. We actually have a fiduciary responsibility to customers. It's limited, obviously, to U.S. equities and ETFs for now. But we're seeing success. So obviously, there's customers that want more guidance and want advice. And we plan to serve them across multiple vectors. Of course, Strategies, which is a digital offering, being one.

37:19But also, we acquired a company called Trade PMR, which will actually give you a human advisor should you want one. So, you know, you'll get a human advisor that we're working on a great experience for how to integrate them into the consumer product. And we'll have offerings across the whole spectrum, you know, from if you want to make a crypto stock or derivatives investment yourself, all the way through to an extremely high touch relationship for high net worth individuals. One of the things that I've been particularly focused on, and I think you probably saw it back in. 21 with the whole GameStop thing was the power of community.

38:05And the power of a hive mind. I don't know if you've read the book, super forecasters. It's a really interesting book because basically what they do is take a bunch of, it's a mathematicians who statisticians who get a bunch of people who are all reasonably educated, but not experts. They then incentivize them to become experts and set them a problem. And what happens is they become better than the experts as this community of people. And they consistently outperform every expert in the space. And it's the idea that the community, the power of the hive mind, is something I think more powerful than people realize because we all learn from each other.

38:46Yeah. And that community thing, I think, is the moat to all businesses in the end. because as ai comes the speed of disruption is so fast in how fast people can build businesses and what happens that really being around humans is maybe the only moat that we've got yeah i i think that's an interesting thought um i'm not sure in short yeah i'm not sure if i agree and in two ways. One, I still think in the age of AI, it's going to be as difficult as it was before to make products and have those products compete for attention, which is ultimately still a fungible resource, unless we somehow find a way to monetize AIs being consumers and customers of our products, which might happen, but at least isn't happening in the near term.

39:48Right. The other side is. I don't know if community can also be disrupted by AI, like, you know, maybe maybe people will increasingly turn to AIs to provide what what they're getting from human communities. And you'll see it happening in the other way as well. Yeah, I think about it just as any sort of technological transformation. When we moved from pre-internet to internet, there was obviously a gigantic change and new opportunities came up. Same when we went to mobile. And also cloud opened up a lot of things on the enterprise side. Crypto is doing that. And the amount of things and the actual possibilities for how you can succeed as an entrepreneur, but also as an investor, have just multiplied and gotten complex.

40:53But yeah, I don't know if the opportunities are dwindling in any way. That's the fear. It's like, what do we do if everything's automated by AI? But I just haven't seen it. Yeah, and look, I mean, eventually AI just gets better and better than us at stuff, right? Whether it's running a business or coding or trading, whatever it is, right? AI will get there in some way, shape or form. And I think a lot about what is the purpose of humans in the workforce, you know, when there's no jobs. And, you know, it gets talked about a lot. And my particular opinion is that humans do one thing better than AI will ever do, and that's being human.

41:34um and so you know what are humans we're social creatures yes can we socialize with ai for sure you're seeing that with stuff like character ai and stuff like that where kids are adopting these things really fast as friends but as humans we kind of like being around other humans and we like being part of big communities like sports music all sorts of religion is another one it's like a community-centric thing that gives us a sense of purpose and i think tokenization is one of the ways that we can monetize that attention within a community that gives us still a purpose that doesn't involve doing a nine-to-five job it's just a different purpose yeah that's interesting yeah and you you've seen it too um in non-crypto context where youtubers have you know like mr beast what's he up to half half a billion plus uh followers subscribers um so if crypto can make that a little bit simpler and allow the creators to capture the lion's share of the value from from those relationships i think that's a that's a big opportunity yeah it's interesting actually because i was speaking to friends of mine who have young kids and they ask their kids what do you want to do when you grow up and if you'd ask you or me we would have had different answers but their answer is i want to be a youtuber yeah and at first their parents roll their eyes and think this is ridiculous and then when you ask them to think about it you say actually this is a pretty good way of future-proofing yourself although we'll still have ai versions of that yeah absolutely yeah and it my my answer would be well yeah you don't want to depend on someone else's platform much much better to be youtube than a YouTuber, right?

43:19That's very true. So when you look out in three to five years, what do you think about for the business or just for the world in general, not just necessarily about Robinhood, but just in the world in general, because we're going through, I mean, we thought crypto was fast adoption, but I think AI has dwarfed that again. It's like kind of Metcalfe's Law squared right now it's so fast where do you think we're going yeah um i think about both of those things i think those are obviously the two big technological shifts that have the potential to disrupt not just the financial industry but uh but everything right uh everything every industry.

44:08It's a humanity scale disruption happening. Yeah. And I think financial services is kind of at the center of both, probably more so crypto, more directly. But financial services is relevant in AI in a number of ways. I mean, one of them being how does financial services itself actually transform with AI, which is kind of the direct, like every industry it's going to adopt and transform. And we're very much thinking about that and making investments. But the other is markets in particular and the role of being an investor. How does that change if some of the other assumptions that we make about AI actually end up coming true?

44:57So for example, if you get Something like what some people are afraid of, you know, large scale disruption of the workforce and employment that's AI driven. What does that mean for investing? And I think a good example for what it could mean is the pandemic in 2020. The pandemic actually gives you a nice little substrate to evaluate this, because what were the government's attempts at with dealing with the problem? It was basically UBI equivalent, you know, helicopter money sent directly to people to make up for what was in that case a much more rapid dislocation in the labor market. But the government had to step in and kind of help folks close the gap.

45:48And what did they end up doing? I mean, they ended up trading and investing in ways that there's been no precedent for. So I actually think the financial industry will become disrupted and transformed itself. But at the end of the day, the need to be cognizant and be an individual investor and trader will only increase rather than decrease. It also becomes a form of entertainment. As you said before, over the pandemic, it became something that people learned and they enjoyed doing. And it felt good. And that was what onboarded so many people. One of the things I think about a lot is something I call the economic singularity, which I kind of pin at about 2030, when GDP growth is a function of population growth plus productivity growth and debt growth.

46:41and we've got aging populations everywhere. So the GDP growth slows down over time. But we're about to introduce infinite humans, which is AI plus robots, infinite humans. Okay, so that's one thing. So we're going to get GDP growth that looks wild, but who does it accrue to? Okay, that's something we can't really get our heads around. The other thing is the speed of disruption to businesses is like, you know soon an ai can build somebody's website in i can do it now in about 10 seconds you can build a website or give it two minutes um so it can build basic businesses very quickly we've got the rise of the agents coming so it becomes more complex but there was a friend of mine um an nft artist beeple who asked me a great question over a drink he just said he's like well when asi comes or even AGI comes, surely it just wins markets.

47:38And the first person to point it at markets makes all the money. And I was kind of joking about it. And I went back and thought about it seriously. I'm like, you know what? Markets will not behave in the same way because most markets would be run by computers. Now, we've had markets running as computers in short term, high frequency trading, market makers, all of that stuff. But now we've got probabilistic longer-term investment models that will do this. I don't even know what markets are going to be, which is why it comes back to your idea of humans still want to speculate. They still want to get ahead.

48:17And I think that prediction market idea is another interesting thing. But I don't know. I just start to get past 2030 and hit an economic singularity where I can't see through the other side. My job as a macro guy has always been to kind of look 10 years ahead and I can't see it. Yeah, 10 years ahead is tough. Yeah, I think we have wide error bars on what happens on those scales. But I think we can predict a few things, right? I mean, I think one claim that I would make is it becomes a little even more important than it is today to manage your own finances, to be familiar with investing and trading.

48:56Because, you know, perhaps I would want to own stock in this trading ASI that you're stipulating. I mean, if we could make a mechanism to make that available to more people, that would be a great way for, I mean, people would be interested in that. And again, my guess is if one exists, there will be multiple, right? People will make their own. They'll compete with each other. Does that then change markets? So they just represent GDP growth or something? I mean, that's what I'm trying to think because you take out the human emotion. Yeah. The fear and greed that makes markets. I mean, I was in the high-frequency trading space, and something like 90-plus percent of trades on the exchanges are algorithmic in nature anyway.

49:46There's very few true retail trades as a percentage of everything. That's right. A lot of the activity is algorithmic, high-frequency trading. Yeah, last time I saw it, it was at least 75 % of all volume. Well, and if you think about it, those are AI trades. I mean, that's probably the first place you saw true AI in the sense of you have to, I mean, the firms that are doing an excellent job of this are firms that take in all the information. They take not only just the market signals from the order book, but they get all the economic indicators. So it becomes an arms race to how you can be the quickest to get oil numbers, commerce numbers, the jobs and unemployment numbers from Washington, D.C.

50:33So I would say that they had AI 10 years ago, if not more, and they're in a hyper competitive race to actually do this. So I'm not sure you're going to see much transfer in financial markets as a result of AI beyond what we've seen. So I would argue that what we were able to do was use short-term predictions. Machines are very good at reacting fast. So taking a piece of information, make a probabilistic outcome, either fading a bid or taking an offer or whatever it was doing, right? Whether it was market making or just high-frequency trading. But anything longer term required probabilistic thinking of which it was not clear that that was going to happen until full AA come.

51:17And now, even if you ask ChatGPT for probabilistic framing for, let's say, macro-based investing, which is complex because it's multi-asset plus economic data and everything else, it now can do it decently well. And that's a big change because suddenly time horizon changes. Yeah. Well, and you also have, because it's a long-term tenure view that you're asking it for, it also makes it difficult to evaluate how good it is, right? I mean, it could be good, it could be not. It's inherently, it's chaos. It's a chaotic system. So it's highly sensitive to conditions at the initial set. So I think that's why it's tended to be used for short-term trading to begin with, because you constrain the parameters.

52:14You also get a really quick feedback loop. If trades last on the order of microseconds or hundreds of microseconds, certainly intraday, you have a feedback loop. But yeah, I mean, high frequency trading, I think as a discipline was there at the beginning of both AI infrastructure and also was probably among the first to use some of these techniques because it's a very constrained, very simple environment where you get immediate feedback on your predictions for the future. In fact, some of the early, a precursor to the H100s and H200s were the NVIDIA Tesla chips. I don't know if you remember the NVIDIA Tesla chips, but it was really part of a push.

53:01It was NVIDIA's first push in the latter part of the 2000s to get into high performance computing. You know, they started off as a gaming company, which is another crazy thing, right? How somehow like they were making graphics cards for PC games in the 90s. And then this became like the what powered the the AI revolution, which sometimes I think about, you know, it's it's you can look at some of these things that look like toys and not take them seriously. But if it weren't for teenagers playing computer games and playing Counter-Strike and Quake in their parents' basements in the 90s, we might not have had the AI investment in the past 10 years.

53:47But some of the first customers for high-performance computing chips by NVIDIA were the high-frequency traders because they were the ones that first saw the power and utility of GPUs to do complex options pricing and other things. So, you know, when Beiju and I got started in New York, we were playing around with those chips. And that was when CUDA first came out. And, you know, now CUDA is used to train all these AI models. Did we ever figure out what Edge Renaissance Capital had and how far they were in AI? Because we never really got to find out what the hell they were doing. I never figured it out.

54:29Yeah. I mean, if you find out, I'd love to hear about it. I know, because their returns were insane. And they'd obviously built a lot of AI. They were precursor because money attracts opportunity. And if you're in finance, you tend to get the technology very early. Yeah, back when I was in the space, before I got into building enterprise software, or before Robinhood, it was all about the high-frequency traders were all trying to figure out how to go from fiber optic cable in the ground to microwave, right? Because yeah, the trick was all about how to ARB the different exchanges. Do you remember the book Flash Boys was about this as well, and how close you were to the exchange and how fast you can pipe the data?

55:19Yeah, yeah. That book, I think, covered events that took place at around that time. So, you know, there was, I think one of the founders of Netscape had built in secret a very straight fiber optic line between Chicago and New York, where you could arb the futures and options markets against equities. And, you know, all of the it was basically sold out immediately. But of course, then someone figured out that, you know, if you go point to point through air via microwave, it's theoretically much more optimal than even a straight fiber optic line. So that was the criticism of it. It was a technological arms race to the greatest degree, which to some degree is happening with GPUs and AI models right now.

56:10But sometimes these technological arm races push society forward in unexpected ways. Do you think AI goes to zero in cost? Just because of the nature of anything digitized basically goes to zero in cost. You've taken trading fees down because of the high frequency traders who take order flow. There's a whole number of reasons, but it just feels like AI is a race to zero in cost, which is an extraordinary thought. I mean, the cost... Well, obviously power and compute in some way, shape or form. Yeah, the cost of compute is certainly going to zero and there's a ton of investment towards more and more efficient compute.

56:50I think also the amount of intelligence, and I don't know if there's a good metric, people are still looking for the best metrics, but the sort of like intelligence per unit of compute is also increasing. Yeah, exponentially. Now, the important question to ask is, what does that mean for aggregate AI spend? And I forget the rule. Maybe you remember it. But there's a rule that says, well, when you lower the cost of something, the usage of it tends to explode. So I actually wouldn't be surprised, at least for the foreseeable future, for the total amount of compute to continue to increase while the costs of the compute and the efficiency.

57:36law there's something law i can't remember what it's called but it was exactly this because remember when deep seek came out the chinese model the markets freaked out yeah oh it's it's they've undercut them in price and then people realize very quickly well the cheaper it gets the more this is going to explode yeah exactly yeah the how do you think your business is going to be using ai when we're out into the three-year time horizon it's too hard to think beyond that i think it feels like the entire ux layer collapses into into ai i don't think so um yeah i don't think the ux layer collapses into ai just because what we've noticed is i mean people want to use interfaces that are specific for the particular use case that they have in mind so i don't think i mean a robin hood ai would replace most of the ux layer that you that you have on the platform currently as opposed to a generalist ai yeah if if by that so i don't think there's just going to be a chat box that you have to type in I want to buy this stock or I want to trade this prediction market or buy this option.

58:58AI will probably streamline a lot of the software that creates custom interfaces for you. And I think in this particular space, if I have to look at products and who I think of the AI native companies are doing a good job, I think perplexity is doing a nice job. They're really trying to go beyond the chat box into building kind of like bespoke experiences for sports, for finance, for other events. They'll give you a nice bracket if you look up information about the NBA playoffs, for instance. They'll do like a nice earnings transcription service. So that's kind of an example of flexible interfaces that are powered under the hood by AI, but understanding that, you know, it shouldn't just push people into a standard chat box, but if you can kind of leverage that to make it easier to design bespoke experiences with like finely tailored UX, I think that would be really cool.

1:00:08So at Robinhood, we've got the engineering side, which was an early adopter of all of these models. I mean, we made it easy for employees and our engineers to take advantage of them to use whatever model they wanted to use to write code with the models. And then you saw it in a customer facing way through customer support, where we very early started making investments. And now with Robinhood Cortex, you're seeing it front and center in the product in ways that solve very, very specific problems for users, which are stock digests and building options trades. And I think from there, we're going to take it even further.

1:00:49So we're looking for the biggest pain points where we think AI can make a considerable impact to the experience of a trader or anyone engaging with other financial products. And you're going to see that, You're going to see Cortex kind of expanding throughout the product suite across the board. The other thing I think about when I think of three to five years time, call it five years time, is there's a trend of bundling and unbundling and decentralization, right? So decentralization in crypto, we'll see it in AI, all sorts of stuff. I also think it's going to happen in asset management. And I think it's a monster because of tokenization.

1:01:31Yeah, we talked about the power of community, the power of a hive mind, the idea of super forecasters. And what it gets me to is that we're going to create crowdsourced tokenized asset management. So therefore, people can essentially be hedge funds or asset management firms or ETFs because you can tokenize it and spin it up. It feels that that is another big disruption to come because, you know, if you look at it as a disruptor, it's a multi-trillion dollar industry full of incumbents that can't change. and yet the technology has changed everything and the behavior patterns of young people have changed yeah i think there's some interesting uh glimmers of what people are trying to do there i mean you have uh copy trading which uh i think is kind of in that direction yeah it's a step in that direction you know it's it's a little bit in weird footing from a regulatory standpoint in uh u.s equities but for crypto you're seeing more and more of that i think we were we were talking earlier about you you were sharing some of the things that that you've been playing around with but yeah copy trading is interesting um and that's just basically what you think about that as a way to integrate the ux and bring community and trading in one place so exactly there there's the benefit there.

1:02:56Tokenization, I think, is interesting because you get a couple of things. 24-7 and fractionalization are nice, but I think one thing that isn't often talked about is the portability of assets. So right now, if you're using a traditional financial account, like Robinhood brokerage account, your assets are in your brokerage, and it's actually very hard for them to leave. I mean, we come across this with, it's called the traditional ACATS process. You basically, I think at most places it still has humans in the loop and it's, you know, a highly laborious intensive process that takes multiple days.

1:03:40So, you know, if your broker has an issue, your assets are kind of locked there. But, you know, one of the benefits of tokenizing and putting assets on a blockchain is that blockchain would have to be down for you to lose control of your assets. So it'll make portability much easier. You know, if there's an issue at the application layer with one broker, a user could just use another broker and access their assets. So as long as the blockchain is bulletproof and robust, yeah, it becomes much less risky for consumers and you get much less lock-in and you can just switch between services and asset managers depending on who's providing the best value to the end user.

1:04:25The other thing that is clear to me is capital formation is going to change. You know, if you think about, we can all be cynical about it, but what happened with that Trump token was fascinating. I think it was the fastest, largest capital formation in history. Multiple billion dollars happened in a couple of hours. Now, it's not exactly the right form, but the financial markets, and particularly crypto, are very quick to use it in weird use cases, memes, stuff like that. But memes of capital formation based around attention. Okay, fine. But it feels like we had the ICO economy back in 2017. We tested the idea.

1:05:04We kind of screwed it up. But it feels like this is a big thing that's coming. And you talked about this as well, kind of, you know, private capital raising. You raised via angel list. I mean, I don't see why that should not be crypto. I completely agree with you. I think that's a huge opportunity. And, you know, we were talking a lot about trading and investing earlier. I think being an entrepreneur and entrepreneurship is sort of like another aspect of that. I mean, in the future, I think more people are going to be entrepreneurs. It's going to be easier to become an entrepreneur. And a big part of success or failure is having access to capital and getting it quickly to the point where it's not very distracting to you.

1:05:54I mean, if you think about it. We talked about you raising capital in the beginning and you weren't able to do product development because you're out raising capital. It's a huge distraction. It's incredibly stressful. Huge, huge distraction. It takes up at least half of your time when you're a small team and you have to do two very difficult things. Make the product work and satisfy an initial customer base with a good product. But also you're spending half your time raising money at the point where the risk and uncertainty is highest. So I think that if we unlock easier capital formation through crypto, we'll get more startups and more innovation.

1:06:34And I think that's an amazing thing. And, you know, the Trump token is an example. I'd say two things about that. One, it does show the power of the technology where, you know, you can get billions of dollars of capital formation by tapping into a global crypto market and, you know, creating one of these tokens. I mean, you get hundreds of thousands to millions of new tokens created every week because the friction of creating it is so low. But also, I'd say part of the reason why crypto has this reputation somewhat, at least in the US, of being disconnected from reality is because currently it's illegal to connect it to reality.

1:07:13Because if you connect it to reality, it becomes a security. And if it's a security, you need regulatory clarity, which we don't have. And so that's why, you know, if you have a dam and the dam and the sort of like huge demand is for people getting access to differentiated assets to invest in that give them the potential of high returns. Right. And you close off one big chunk of it, which oddly, I think, is the chunk that people would want to see more of. Then it'll find another way to get through. And I think that's happened through the meme economy. So I think if we had comprehensive crypto security legislation and we were allowed to connect cryptocurrency technology to real world productive assets, certainly a higher percentage of crypto activity would be in real world productive assets.

1:08:09Like you'd see it applied to securities quite effectively. And so it would solve that problem. You might also get more meme activity kind of in aggregate, but certainly the percentage would shift. And I think the perception of crypto as a technology would improve. So that's one of our biggest policy priorities in Washington. Yeah, I mean, when I extrapolate trend rate of growth out of crypto, I get to something like$100 trillion within 10 years, which would be in line with other asset classes. even if I'm wrong by 50%. If it is 100 trillion, we're only 3 % of the journey. But even if I'm wrong, it's still going to be the largest, fastest wealth generation event in all history.

1:08:57I think people aren't understanding how much capital is going to get formed in this and the uses of that capital and how it completely changes the game, as you talked about, access to capital. Yeah. Well, my prediction, this might be a little bit of a hot take because it's aggressive, but I think that technically what you're saying could happen, but I don't think it's going to be native crypto assets like we have them today. I think at some point we're going to flip a switch and the securities markets will all be powered by crypto technology. For sure. It'll be almost like how technology as a sector has become the largest sector.

1:09:42But because of the behavioral incentives of the protocol and how they use tokens, it's going to accrue to those tokens. So it's like using AWS accrues to Amazon, but using Ethereum accrues to Ethereum token holders. So that's where the wealth generation comes. You can build the whole financial system on it, and we will for sure. you know that was my first i wrote the first ever strategy piece on crypto back in 2013 this was my base case is the entire financial system has to go on it and i think that's true but that increase in token value it's a big deal yeah and and you'll you're saying that that'll increase uh that'll accrue to the platform layer the blockchain layer itself yeah i mean it'll accrue to various layers because you have the applications layer and the infrastructure layer essentially i mean it's just of technology the other thing that was interesting is talking about bringing it back to the loop of ai was seeing the fact that i don't know if you saw this the ai that ends up raising money from mark andresen and then ends up launching a token and self-funded which yeah uh are you talking about truths which one is it terminal of truth oh i'm not i'm not very familiar that was so it kind of the guy who developed it some kiwi in australia had got this a few ais to talk to each other and lock them in a room essentially and they start driving each other mad they start developing a meme just unencumbered by humans they start developing a meme yeah then it's then it goes he gives it the twitter account it goes on to twitter it then says it pings mark andresen said hey listen i want to raise money for myself to build out this stuff and help out my human um mark says sure what do you need and he said like a one bitcoin or whatever sends it a bitcoin as a grant and it ends up launching a meme coin that at one point was worth a couple of billion bucks i mean it was like again it's experimental it was clunky it was still a bit of human intervention but you can see where it's coming, that AIs will be able to form capital in their own right to pursue certain activities.

1:11:55And its only interface to the outside world was a meme coin? Yeah. And the Twitter account? Yeah. Yeah. It's amazing. Well, that's pretty amazing. Yeah. And imagine as the models get better and better, they'll actually be able to produce software, right? And so, yeah, you could have autonomous companies and products being generated. And we'll have autonomous traders. And we will invest in them, you know, and it brings it back down to the tokenization, the kind of crowdsourcing, the AI. You know, it's all it just feels like we're about to live through an incredible time. So my final question for you, which is the most important question of all, is when are you buying this crypto punk?

1:12:36You can't be in crypto and not have a crypto punk. yeah uh i know i kind of uh uh i i've been i've been late to the whole uh nft punks and the price has been going up as well we've been telling you about this yeah um i guess i still have to find one that looks enough like me all the ones that look like me are extremely expensive for some reason i have a very desirable attributes if they were in punk form i love it vlad listen thanks so much really enjoyed the conversation and uh good luck with the next year because i'm sure it's gonna be an exciting one yeah yeah it was good good to catch up uh thank you for having me on absolutely a lot of fun hopefully see you in the world somewhere soon all right likewise so a great conversation with vlad um i've got to know vlad um um over time.

1:13:32Really lovely guy, really thoughtful. He understands what he's trying to do. And I think it's just really interesting to move away from just the standard stuff and pick people's brains and where we're going in the future, where this AI is leading us, how we're thinking about markets. And hopefully you got some of the insights into Vlad's amazing thinking. And I'll certainly get him back on again in due course where we can talk through more of these topics. But until next time, enjoy yourselves and be careful out there. If you like this episode, I'd love for you to head over to realvision.com forward slash join for a free membership.

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