E36: Fractionalizing Real Estate - The Future of Investing with EKTA CEO

39:11Over here, it's a bit tricky, so I have to be careful. So I have lost a lot of money that way, especially like I like to find deals. So whatever the real estate agency posts there, I go around, talk to the locals and say, is that land for sale? Is that land for sale? And I compare prices in the agent's window and I'm like, ooh, that's very cheap. I can buy it and then flip it. but then when you sometimes it's cheap for a reason because it's a problem so I take the risk and then I lose and then I'm like oops I just don't tell anyone about it especially my mom she get angry at me

39:52how do you keep hungry when you could just stop working forever and also

40:00especially when you're young and you make a lot of money quickly is what happened to me two years I mean, two years ago. I also lost a lot of it afterwards. So I had to kind of become hungry again. You lose the drive. Yeah. The first time. So like, how do you, what happened to you and how do you deal with that? You know? Yeah. That's a good question. I lost my drive many times, but then I had to get my drive back because I'm broke. I'm like, I have to earn money again. So that's the beauty of getting your drive back. Sometimes it's monetary motivation. survival instinct yeah yeah wrong investment and like fuck i'm broke i need to earn now i need and then now you start thinking right when you're on survival mode like your body your brain everything is like heightened senses so that you know you start thinking of you know how do i i guess it's manifestation you start thinking how do i make money how do i make if your focus is on something like a crazy amount of focus, things will happen around that.

41:04Absolutely. But what did you learn that you do? I mean, how do you stay hungry now? Because you have everything. We're in this amazing villa. You own like 500 million real estate or like huge. You could just say up. I was actually really so down pre-COVID. pre-covid so in between so i i was i was married once and uh with i had two i have two two children and uh when she divorced me she went back to the uk with my kids and then i was like uh i'm just gonna party and you know meet new girls and all the time and i was just doing the same shit every day and then i was like just visiting my hotels and you know getting passive income from there but then i was like okay early 40s why am i what am i what's the point of living like i'm supposed to what's my mission in life what's my drive yeah yeah and for a man like if you lose your drive yeah like it's over especially an entrepreneur like if you don't have a purpose like you're you're finished and i was just questioning why i've been doing property since 2000 and then it was like 2017 2018 i'm like i'm so bored and also all my friends are my age 42 43 three all they do is like go holiday go to the gym uh text some girls and then play golf and talk bullshit all day and drink i'm like i don't wanna i don't wanna be like them and they don't wanna change like they don't wanna they're just stuck in their ways so yeah it was uh really i was looking for something new and then uh something forced me to do something new which was the pandemic because then the world shut down and then you know the hotels my hotels shut down I couldn't do property development.

42:51I couldn't sell property. I have to pay my staff, even though the hotel's closed. And then all of a sudden, I'm like broke again. I mean, in terms of cash because I can't liquidate anything. So I'm like, yeah. That's a very smart way of doing things. Like you, and it's what I learned from like my fuck ups is like the next time I build a lot of wealth quickly is you just need to invest it and act as if it's not there. and only leave from your business revenue or salary that you can pay yourself, and it's going to force you to keep going. Otherwise, if you leave from this other thing on the side, you're going to lose your drive, and therefore, you're going to lose your happiness.

43:32Yeah, you know, I was so broke. And your sense of self-purposed. In 2020, I was so broke after a few months of the pandemic. I met Sophia, my fiance now, and she was also broke because she was starting her spa business in Uluwatu, and all of a sudden, the pandemic happened. We were staying in a homestay, like in a room. That's how broke we were. I was like... Yeah, but it's great. It's a blessing because you're just there like... It's kind of like what we were talking about before. If I can leave simply, I don't have much risks. There's only upside. And getting back into this survival builder mode is actually super exciting deep inside.

44:17I think you know I mean maybe maybe there's you don't want to go to the extreme on both sides like I go crazy and then I leave on a mattress on the floor but yeah but still like just it reminds you like this early 20s and be like oh like I've done it multiple times over and I'm just gonna do it one more time and and if you're like an entrepreneur what what you love is the is the journey and the pain and the struggle and not the result because the result is a is actually leading you to these things that you were talking about partying every day being bored and all that stuff yeah it's quite destructive so if you have a lot of energy and talent uh and you use it in the wrong purpose uh it's very destructive so it's good like to focus on building stuff or doing projects or just exercising how much do you trust governments and central banks and did you see a difference in all these countries you lived in yeah I I can't say

45:19trust because the thing is I work with governments actually so I like to work with them because I like to do a lot of education program and charity work foundation work I don't trust the people running it sometimes because the money disappears, there's corruption. But you have to trust something and if that's the thing there, so I just have to work with them. I'd rather not. I'd rather do private stuff. That's why I started Layer 1 Blockchain because I thought, oh, I can create my own country in my protocol. There's a lot of inefficiency. So I can't say they're all bad, but most of them are really untrustworthy.

46:10And you tend to lose faith in them, especially when you see, you know, the country is very wealthy in terms of natural resources. And then everyone is poor. They don't have free education, no free health care. There's like poverty. And you're like, where are the taxes going? And then you see these politicians with the nice house. And of course, you see them on holiday in Europe. you see them with a nice boat, you're like, okay, something funny is going on here. So yeah, of course, you lose trust in the government. Central banks, there's so much. I don't like banks. That's the problem. What do you not like about banks?

46:49So hard to open a bank account with them. It's crazy. I'm an entrepreneur, so I want to start a new business, and I need to open a bank account. And they grill you as if you were a terrible terrorist or a money launder, or anything. I just need a bank account because I'm an entrepreneur. I give you so much bullshit. They question everything, bank transfer, what you receive. I'm like, dude, I'm just trying to work. It's my own money. And so, central bank, I don't know. It said bank, right? So, central bank. So, yeah, they just annoy me so much. And the fact that they're, like, when you deposit your money with them, it's not there anymore.

47:31The money is not there. That's one of the key earnings for a lot of people lately with the US banking crisis. I mean, it's kind of a stealth banking crisis. So most people don't really understand it's happening, whatever. But like, and it's one of the key arguments of Bitcoin. Yes. But yeah, the money is not there. I'm an economist by, you know, graduating with an economics degree. I understand money and I know fractional reserve system. so I always didn't really trust the bank that's why I put all my money in property and I didn't want to take a mortgage or a loan because I don't want to give it to them I don't want them to earn because they're really evil they're nice to you they let you borrow money and then when the crisis happens they stop your mortgage or they stop your loan and then they let your business go to shit and they get bailed out by the government but from taxpayers money and then like yeah they give you two warnings and they take your home away from you so even your home is not yours if you have a mortgage if you have a mortgage that's a really key argument about not using leverage actually I didn't even think about that ok what about for example in Bali owning a house but it can also be seized by government because if you because you know they it happened a lot in the past so everyone could come and say this is my house not with a leasehold leasehold is the strongest contract ever so if you have a leasehold and the government says i'm going to build a road across your house they can't do that because they can't even buy it off you so like freehold they can and so leasehold here in Indonesia is like that's why Bali prices went up so much and the roads here are so bad because they want to build a bigger road but they can't because they can't even confiscate the lease and nothing yeah if the land is illegal or you built on a green belt or something you're not supposed to build on of course they can do that because you broke the law but if you're doing something right and they can't just come and take it okay do you think the Bali prices for housing market are sustainable?

49:56They always go up. I've been living here for 14 years, coming here 22 years. I've never seen the price of property in Bali go down. During the 2001 bombing, it was flat. 2008 global financial crisis went up 800 % in eight years. Wow. Like now when the pandemic, there's still a pandemic, but when the borders opened in April last year, property prices shot up maybe 70 to 80 percent in one year. Rent went up over 100 percent. Crazy in the rain. Crazy. Yeah. Used to be like affordable luxury and now it's almost European prices. The thing is, here in Bali, prices never drop because no one really borrows money, especially the foreigners, because they can't get a mortgage.

50:48So it's all cash. So when there's a crisis, they're not in… There's no deflated bubble. Yeah, they're not forced to sell because they have to repay the mortgage. So that's a special… Very interesting. Bali is special that way. Prices don't really drop. Is there another place in the world where it's similar? Foreigners can't get mortgage, therefore they need to buy full cash. I think a lot of Southeast Asian countries. Okay. Yeah, if you're a foreigner, it's hard. What's a destination or place in Southeast Asia or in Asia that you would like or that you are considering or already investing quite heavily?

51:31I love... What do you think is going to be? A lot of people talk about Vietnam. Yeah. what are the next places that are really interesting to to tell you honestly i go all over southeast asia to look indonesia is the best okay indonesia is so good indonesia 17 500 islands they have so many nice beaches nice places to go it's a amazing place to go go sailing do water sports kite surfing all of that have a really cool lifestyle indonesian people are so nice yeah it's really nice yeah yeah and so chilled and everyone's happy also like this area like bali lombok this this area no typhoons so if you go to vietnam come thailand philippines you get typhoons five six months a year here none so it's just like that's why tourism here is thriving you get uh you know villas with 90 occupancy all year sometimes it's crazy it's crazy yeah How do you discover this blockchain thing?

52:30Oh, so it was really funny because our event two days ago, we did this advertisement about Hector Real Estate and how it started. So I go, so it started when someone ate a bat. Basically, it's COVID, right? So basically, it started with the pandemic. The world shut down in, I think, by March 2020. everyone was freaking out already because it just started in China in November and then they said, oh, it'll just stay in China. And all of a sudden, it started hitting Europe. Everyone went skiing in the Alps. They came back home. They were all sick and it's super spreader everywhere. And then by March, it's like borders are starting to shut down.

53:11People were, it was like the end of the world. I'm like, oh my God, this is scary. I was actually scared and everyone was leaving Bali. And then by April, the border shut, everything shut. So I'm like, literally, zero tourists. I had to close all my hotels and I had no cash flow all of a sudden because that was my cash flow. So you have to close all the hotels, you don't have cash flow, but you still own the places. I do, but then I was paying the staff still. You still pay? Yeah. And then, so that even hurt the cash flow even more. And then I was like, there's nobody in the island, but just really nice people.

53:50So all the tourists left, but all the like-minded, independent thinkers, intelligent people that said, I shouldn't go home. I should just stay in Bali. Which turned out to be the best decision. I was here for COVID for a couple of months. It was the best. The best freaking Bali time ever and the best place on earth to be during COVID because no one gave a crap about COVID. Yeah, there was so much freedom here. and the smart ones basically moved to Bali, rented or bought a big villa. Yeah, you do a business visa. You do a business visa, you come here, and then you have like the time of your life.

54:28You have a five, six, eight bedroom villa with fully staffed swimming pool and you use it as your office. You stay in the villa, you swim, exercise, do your gym, whatever there. So I was fortunate to meet a lot of people in blockchain and crypto, living here. It became a really big crypto blockchain island in the early 2020s, mid-2020s. And I just was really bored, and I really needed to change my life anyway because I was already questioning why am I here. And then I met so many people in the industry. They started sending me white papers. And I'm like, what is this crypto? It's so interesting because I don't know anything about it.

55:09I'm not a traditional guy, real estate. So I read Vitalik Buterin's white paper. That's the first thing I read. So Ethereum white paper. Yeah, I wanted to know what is Bitcoin. So I read Satoshi, Nakamoto, and then I read Ethereum, of course. And after I read Ethereum, I'm like, wow, you can do this and that? You can do DeFi? You can do all of these apps with the token? Because first I'm like, what is this token, coin, whatever? I just see the price going up. Okay, I'll buy. But I don't understand the science behind it. But once you understand the science behind it, I'm like, what is Cardano? What is Polkadot with the relay chain?

55:52And then you have BNB chain. And then you have what is a transaction per second? What's a TPS? What's a throughput? So I learned all of that. And then I started to learn about all the dApps you can build on it on the layer one. and then I learned about literally you can start your own protocols and you can start your own community and kind of like a micronation. Exactly. Yeah. I was so intrigued with that because at the same time, when I started reading this blockchain, I'm like, there must – and I learned there's NFTs, there's tokens. You can speculate on all these things. But what interests me is like what about the real-world use cases?

56:33So I wanted to see what real-world use cases with that. So back then there was like not so much property on chain. There was like, I think Realty was already there. Propy. There was, anyway, a few of those. And then I learned about like DeFi. That was very interesting. Very interesting. Play to earn games were super, super cool at that time because you're like, wow. Yeah, you had the Axie one. That was a big thing in the Philippines. And because I'm an economist, I love token economics because you really see the supply and demand side, the utility of the token. So yeah, I got into that and I said, holy crap, I read 200 white papers.

57:19I would say, because it's very confusing in the beginning. Yeah, I was so confused. There's a lot of crap and what is that? And this token and this tokenomics and the governance model. Yeah. So how, what happened, how long did it take you and what happened for you to understand I can leverage blockchain for my real estate business? Yeah, so what was really interesting was the real world assets on the blockchain. Back then, what was really big was there was the DeFi summer, and then there was the plate to earn, and then there was the summer of the DAOs. OmDAO, I forgot, there was a few of these DAOs.

58:04with. I was wondering, questioning so many things, I'm like, why is the APY 100 ,000 %? That's not sustainable. Where is that coming from? And I realized, oh yeah, it's Ponzi-nomics and it's not sustainable. So I wanted to find real-world use cases and one of them, like maybe planting trees, like metaverse game where you plant trees in the metaverse and it goes to planting trees in the real world, maybe you can earn money with that, or real estate, fractionalizing real estate, because what I really wanted to do when I started my layer one is to bridge blockchain to the physical world. And because blockchain is so new, it gives people their own power.

58:54They become their own bank. And because of that, it improves their lives or ruins their lives if they speculate too much and leverage. but it can improve a lot of people's lives. It's a source of truth. It's immutable. The code doesn't lie. Once it's there, it's there. And so I'm like, wow. So now you can do first crypto doesn't sleep. You can trade anywhere in the world. It's borderless. You don't need the banks because you can do DeFi. There's no centralized authority. I'm like, how do I make the four big problems of real estate disappear? What are the four big problems? Number one, real estate is highly liquid.

59:38Number two, you're limited to what you have in your wallet or your bank account to buy property. Number three, it's specific to that location, geolocation specific. And number four... What do you mean by it's specific to that? You mean like there's these markets and everything is different in different places? Yeah. It's not the same like everywhere. Yeah, there's no standard everywhere, right? So if you go to Thailand, you have to abide by Thai rules. If you go to Indonesia, it's Indonesia rules. And then number four, there's many industries, right? So there's the hotel, the hospitality, the retail, the industrial.

1:00:19So I wanted to make it multi-chain, multi-verse. It's agnostic. It's just like if I want to buy something in Thailand, I can for a fraction. And then all of a sudden, I just go to Indonesia. I can go there and do that. And I don't need to think about the laws.

1:00:41I want it more liquid. So if I want to sell it, I can sell it quickly. If I can't afford it in Thai property, I can buy in fractions. If I want to, I think the yield in parking spaces are good, I get 30 % per annum. Okay, I can buy a bit of this, a bit of that. So like a basket of everything. And blockchain can do that, which is great through NFTs, through ERC-1155 token standard, which is the fractional NFTs. and then I mean it becomes like borderless as well and then you can have like a portfolio of properties in your phone literally and it's a stable and more safe investment because for example even if you're not in crypto if you buy stocks it's very risky if you pick the wrong one but if you buy property if you look at the stock market it goes up in history is it goes up around 11 % on average per year.

1:01:47Property goes up about 10 % per year, but it's not volatile property. It's just steady and stocks go up and down. So I thought like, you know, a lot of people would understand, a lot of people don't understand crypto or blockchain or all these protocols, all these layer one, ZK rollups, blah, blah, blah, but they understand real estate and it's like a really good, easy entry point for them to get into blockchain through an entire NFT or a fractional NFT. Okay, so you understood blockchain and how you can solve the four main problems of real estate with blockchain and what did you build a fractional real estate?

1:02:30launchpad and secondary marketplace. Explain this to me if you're talking to your grandmother. Yes. She understands real estate but she doesn't understand crypto. If you were my grandma, I would say to you, grandma, how much money do you have in your wallet? A hundred. You know you can buy property with that. How? Infractions. So you put that money into this app and then you can choose from, different photos in your phone and then just say buy and you can buy and it's yours. If that property is earning 20 % from rent per year, you get 20%. It's better than putting your money in the bank, for example, and then you can sell it anytime.

1:03:19Just put it in the secondary marketplace. You can do bid offers and there you go. That's pretty awesome, actually. Yeah. It is. And for the buyer, zero fees. Like, where do you get that? And also, like, imagine you go to Cambodia. You're like, oh, my God, I can't read Cambodian. But then if it's on the blockchain, it's a source of truth. You're like, buy for one fraction for$100. Okay, let me try. Now I have something in Cambodia for zero cost. So a few questions here that pop up to my mind. So I'm a buyer with limited capital. I can go on the app, buy a fraction of building or house or villa.

1:04:09Maybe hotels. I don't know. What's the plans? So what we fractionalize. Restaurants. It's the management rights of the asset. So the good thing is when you sell as a property owner, you can sell it very fast like in a few minutes it's sold out in fractions so you don't need to raise capital through the bank or anything and then you can use that to build more you know things that you like to build on or develop on that's amazing for a property developer for example plus he gets royalties for the rest of his life because that fractional NFT when you trade it in a secondary market he gets royalties so he loves that less fees than less commissions than normal the blockchain will collect the taxes for you and pay the taxes so you don't have to even worry about paperwork and taxes and then you can just focus on what you love doing the most is you know developing property for the buyer zero cost zero fees can buy infractions and then for the agent like you know the real estate agent all sudden like you know at night if he wants to send the referral code or do maybe once a week event and refer people he gets extra commission so everyone wins so it's it's actually quite good and we follow all the regulation all taxes are paid uh it's very transparent so you can see when it's rented the money goes into the property management company into the wallet and then you can claim it um so i've i'm buying rights of like management so for example i buy a i'm buying part of a building with different apartments if i buy 51 of the building i'm going to be able to decide yes everything that's happening in that building yes because then you're part of the dow right the dow is a decentralized a decentralized autonomous organization i guess in the real world it's kind of like a property homeowners Owners Association, something like that.

1:06:18So you can decide on that. Or one day if a physical buyer wants to buy that property for double, you can decide, okay, sell. And then that's your liquidity as well. You get a lot of liquidity back that way. But there's also liquidity because you can sell in the secondary market. You can sell those NFTs. We call them FREMs, F-R-E-M, fractions of real estate management. how do you make money if people pay zero fee is it because you're the property developer and you can raise money much faster and move on to the next project what's the so you mean for my business exactly yeah why do you why do you do it i mean obviously you're gonna say i want to make the real estate market more liquid i want to help people to invest even if they don't have that much But there is an honorable side to that, but you still need to make money.

1:07:12Yes. Otherwise, it's not going to work. That's a very good question. And the way we earn money are two ways. Number one is from licenses. So we sell project and country licenses to anyone that wants to open their own marketplace and integrate into our platform. B2B? Yes, B2B. Okay. And then number two. So you're selling a technology stack? Yes, yes. We're a SaaS. And then number two is the marketplace. Just who would, what kind of businesses would do that? Like other real estate developers? Yes. Property management companies, real estate developers, property listing companies, brokers, they'd love that.

1:07:57Yeah. So they would do that because it makes sense because then they have their own marketplace and they get platform fees from that. And of course, we get the platform fees, global platform fees as well. So the way we get platform fees is, during the primary sale, during the launch pad, we charge the seller percent. And then during the secondary market sale, we also get a percent from the sale. Based on the NFT contract or the token contract. So every time there is a sale somewhere, there is a chunk. Also, we have listing fees. Eventually, we have data that we can use, subscription, and stuff like that.

1:08:42Okay. We actually have no token. We just use Tablecoin. Also, the fractions of the frems are ERC-1155. So, it's a token. So, this is Ethereum-based? We're chain agnostic. So, we launch in Ethereum. And then, next week or the week after, we're in Polygon. and then we eventually do Ektachain as well. All the EVM chains first we can do. But we use USDT on their network. So USDT on Ethereum network, USDT on Matic network, like that. How do you avoid building the next Celsius or FTX? How do you make sure that people can actually trust you? Yeah, because the main thing would be, I'm putting money on an app.

1:09:36You can disappear with my money. Yeah, we don't hold anyone's money. So it's all in the smart contract. You can see everything on chain. So the only thing that there's human intervention is during the listing, the notaries or the lawyers are the validators. So they have their portal, notary or legal portal, and they validate the documents. there has to be two validators and then when it's approved it goes on chain the the real estate owner can start fractionalizing the real estate and it goes to their wallet not ours we just uh we just take platform fees so we don't hold anyone's property we don't hold anyone's money but the tokens so i'm buying okay let's make it very simple for our beloved grandmother I'm buying, I have a hundred bucks, I'm buying a share of a villa.

1:10:34Yeah. This is represented with a token. Yes. Which in the beginning is in your app. Nope. Where is this token? The token, for example, there's many, many houses, right? So each house has a token. So the seller, first, let's say it's a million dollars. he says it's$100 per frame. So there's 10 ,000 of those tokens. So he puts it up on sale. So he goes to his dashboard. He says, I'm putting up 1 million for sale. Soft cap, meaning let's say 40 % soft cap. So if I get 400 ,000, I'm happy I can close the sale. Or I can hit the hard cap, meaning sell all. There's a time frame, let's say 60 days. and if they don't hit the cap, the escrow will return the money to the buyer.

1:11:25If they hit the cap, the contract will say, okay, the seller can withdraw. Once he withdraws the cash, we have an exchange partner that can do the OTC for them to move it from crypto off-ramp to fiat. The new owners of those fractional, the frems, it just stays in their non-custodial wallet. So the app has a non-custodial wallet. they can export the keys okay so in the beginning there are my token there and then i can just take this token yeah send it to my ledger or yeah treasure or whatever yeah so we we don't own anything we're just a marketplace and a software company we provide the tools so i have this i transfer this token to my cold wallet yeah but then the system still understand that i own even even if it's not in the app anymore, I own, Kevin, I own this token in my cold wallet.

1:12:20Therefore, I own the rights to receive rental yield every day or week or month or quarter. Therefore, I still have in my app account this money that comes in crypto, I guess. Wherever your token is, wherever your token is, you connect your wallet and you can claim from the claimed app. right however if you want to sell that NFT you can only sell it in our platform so you can view it in OpenSea you can view it in you know Magic Eden but you can always sell it on our platform because that's how we earn through our fees okay okay very interesting is it so it's very interesting but it also requires people to understand these technologies yes like this is a barrier to entry because you need to educate people yes you know because in the in the ideal world everybody is like oh man that's amazing like but this involves crypto knowledge like private keys and all that stuff like how do you think about I mean you could say the exchanges actually have the same problem and they offer they say you can keep your money on my account on my exchange but the risk is I'm an FTX or I'm a Celsius or I'm an other 20 exchanges that blew up.

1:13:40Like, how do you think about this site that could kind of prevent you to get the goal that you want? Yeah, so... Have an academy? We have an academy. We have an academy. We currently have five modules. We haven't gone on any sale yet because we just launched... We did an event two days ago to explain that this app is here. Whoever wants to list can list. whoever wants to download the app and KYC, they can right now, and then they can load their wallet with Stablecoin. We will be doing a massive sales push very soon. We have webinars. We have in real life events. So the way we sell, it's not like crypto style.

1:14:25We don't do like Discord, Twitter, Telegram. We actually go in real life and we go webinars. So what we do is we target schools. We target real estate agencies. we target real life communities and we explain to them what this does. It's very simple because the app is simple. It's like an Airbnb app. Your wallet's in there. Your chatbot's in there. Everything's in there. So it's a very web2 feel. So people know how to online shop. People know how to use Uber like that. So people know how to book in Airbnb. So it looks like that. Okay. So it's quite easy. Okay. You launched a blockchain too. Ecta blockchain?

1:15:08Yes, we have a layer one. Can you tell us a bit about, for me, the most interesting part that I often ask people who launch a blockchain, they launched a token. How did your life change after launching a token? Because a lot of people say this is like a second business. It ruined my life. It's a very... People always think, oh, these people got so rich launching this token, but they don't realize what comes with it. and actually most of them fail or is it a journey and a roller coaster? Can you tell us a bit about your token journey? That's why, so our layer one has a token. It's called Ekta and it's listed in a DEX called SushiSwap and in a centralized exchange in MEXC, for example.

1:15:55The token ruined my life because then everything is about how to pump the price, how to do this. And then you forget about how to make the business work. So fortunately, the bear market came and we were building the whole time. And when we launched this Hector real estate platform, I said, no token. Doesn't make sense. It's just... Doesn't make sense for most things, actually. Yeah, exactly. 99.9 % of things, we don't even need a token. So actually, our token makes sense because we're layer one, which means we need it to mint NFTs, pay for gas fees. our chain is actually not proof of work or proof of stake.

1:16:34We're actually proof of authority because our chain is focused on B2B and literally like real world use cases because also I have a property development company. We have like, you can create a whole community and a use case for the token in like the resort or in the tower, in the building, stuff like that. So we're a bit different. But yeah, it ruined my life. I mean, I have no idea about blockchain. And then I launched a token and a layer one, which is the hardest in June 2020. No, sorry. We IDO in July or August 2020. By October, very quick since discovering blockchain and saying, are we going to launch our own token?

1:17:19Yeah, that's the problem when it's too quick, because I don't know a lot about blockchain, especially the tech. I got rugged by my own CTO in October. So our token price was crazy. It was like we IDO'd a few cents, and then we reached over$10. And during the peak, our CTO rugged us. And of course, I had to go public and explain to people what happened. Where is he now? He's hiding somewhere in China. He's in Chengdu in the middle of China. He's Chinese. and yeah I mean I had to rebuild the whole chain because I you know I'm a person of integrity I'm I'm web one so I'm like I'm not used to like rugging I never heard of that before I have word of honor and so I that's not something you can do with shares the rugs no doesn't exist yeah so we relaunched just Can you get the rug?

1:18:18What did he get out with? He basically exploited the bridge. Okay. So he minted unlimited tokens on the bridge and then sold it on the exchange. And the price from$10 dropped to 0.000. It became like Pepe. 0.0000 something. There were so many zeros. And of course, everyone was crying. Wow. Okay. Yeah. I lost my money. i lost this i lost that i'm like don't worry i'm going to migrate the chain migrate the token into v2 and like luna basically like the luna luna one that went to zero one then they did luna two yeah to kind of like okay yeah we migrated but then we did a screenshot so everyone with that token the snapshot okay snapshots we we gave back the version two so everyone didn't lose money okay which was good it was but the dude is gone with a lot of money basically yeah Yeah.

1:19:14And we're not a big chain, right? Our market cap's small, so I think he ran away with five million. But still, that's a lot of money, because I had to rebuild it again. It cost me two million to rebuild. And then of course, people lost trust, everything, right? That's the big thing. Because the token is actually the biggest market. It's not linked to how the performance or like the actual business, like the development of the tech and everything. But it's basically your main marketing tool. Token goes well, amazing project. Token doesn't go well Shit project Yeah that's why It ruined my life Because like My project is so good I'm building The token doesn't reflect What we're doing Eventually it will In a few Next year it will Because you see There's a lot of utility And use cases for it But right now You know It's still very young And It takes a while Yeah but yeah So we launched V2 And People The community Trusted us again And then the bear market Happened So so that was very painful again last year i mean it's not only bear market rebuild the chain but then we build the chain we relaunched a few sets went up to six dollars over oh so it was like crazy everyone was happy again and then emotional roller coaster of owning tokens and that are there are mostly vested i guess for most people so you own them you have the paper well but you can't sell or whatever because it's vested so actually you go through like this crazy emotional swings yeah i'm poor i'm rich i'm poor again i'm rich again i'm poor again yeah yeah um i'm just gonna find a normal way to make money because i'm not gonna rely on these freaking tokens yeah yeah it really ruins your life yeah but and then jesus last year was crazy because you had the Luna first going down the USD pegging.

1:21:07I always knew that something was wrong with that because it doesn't mix. Algorithics stable coins are a bit dangerous, especially when it goes to the death spiral like that. They never worked before, actually. And Luna was the exception that I massively believed in. I was massively invested in that and got completely burnt. Before that, remember, they had Titan as well. Exactly. And then before that, there was like six that failed. the titan and all the others were all based on these super high apys whereas like luna we had dokun on the podcast actually and um i asked about the death spiral because it was a big question back then and he was saying we build this entire economy around the around the the stable coin that kind of forces you to use this table coin so you're not incentivized to like dump it because we built this entire economy with all these applications but at the end of the day while was all these applications, a lot of numbers that were propped up and kind of fake.

1:22:03And also the main one was Anchor. Anchor Protocol. Which basically had this high APY, 20%. Yeah. I mean, we know what happened. Yeah. But you know one thing Do Kwon was right about is the banks can affect crypto. And you saw that with Silicon Valley Bank. If Luna was still alive a few months back, it would be like crazy because because a decentralized stable coin and the reason why it needs to be algorithmic because otherwise it's centralized yes the usdc example was yes correct right so basically you realize oh like you're like there's this meme it's so the meme on twitter that elon musk posted which was um like you know you you can choose between it's a guy who is like sweating and he's like he has his choice between these two buttons one is um crypto is a scam i should put my money in banks and you can press this button and then banks are a scam i should put my money in crypto and the guy is like sweating because it's crazy because this is exactly what we experience and even like the safest stable coin you realize is actually tied to these banks that don't have the freaking cash yes there like And then the thing like de-pegs.

1:23:22Yes. And crazy. He was right, though, Kwon. The bank can hurt crypto. And it showed in USDC everyone thought it's the most safe and stable coin. But then it de-pegged to$85. Of course, it went back because it's backed by 1 to 1, M1. and short-term bonds, right? So I actually bought, because I just bought, it's going to go back to one. But then a lot of confidence disappeared, right? Imagine if the FDIC didn't pay all the depositors, then that's three billion gone. So that's... Crazy. Definitely that will be depegged for a while. But, so on one hand, this was really bad for stable coins and everything.

1:24:15But on the other hand, this is the thing that convinced me to... So I was rebuying crypto since like November, December, but to go all in. Because that was like the main, the reason why Bitcoin exists is exactly that. So like for me, the conviction was, after all the shit that happened last year, I was like, the conviction for me is like to go all in crypto again, because of basically you, if banks fail, like which there are, and if there are probably hundreds of banks that don't have the money. Yeah. And the way of the FDIC and the government is to basically say, we're going to save all the depositors and everyone.

1:24:58Therefore, we're going to print money. Yeah. Therefore, if you print money, liquidity goes up, which is amazing for tech and crypto. Yeah. Therefore, you know that sooner or later, like you can increase the rates, you know, increase the rates and hurt more banks. But you increase the rates. More banks fail, more money printing. You lower the rates, better for risk assets. So basically by owning Bitcoin, you're good. It's really amazing. I was looking at Satoshi Nakamoto put a message in the genesis of the Bitcoin. In 2008. And it says banks are supposed to protect your money, but instead they go into reckless investments and lose your money.

1:25:43And really the use case of Bitcoin came out during that collapse of those three banks, SVB, Silvergate, all of that. I said to my team, I think BTC was 20 or 21 at that time. Already went up from 16. I said, watch, Bitcoin will go up this week, next week. People are going to lose trust with the bank and they're like, oh, the use case is here. And it started going up. And yeah, I think there's going to be more bank failures for sure. And the use case of Bitcoin is there. And it's such a sound money. No one can control you, can shut it down. I love Bitcoin. Whenever it drops, I just DCA, DCA, DCA.

1:26:27What's some of the craziest shit that you've seen or lived in your entrepreneur life? I think being in crypto. Launching the token, seeing all this shit going. Getting rugged by my own CTO. That's a big one. It's crazy. Seeing my, I couldn't withdraw my money from Luna, Anchor Protocol, and I was freaking out and eventually I could and then I already lost like 20, 30 % and it was going down, going down. That was crazy. That was crazy, yeah. Fortunately, I wasn't in Celsius or FTX but I was just having fun because I was being full DJ at that time. I was just investing in these DAOs like what was it?

1:27:12Wonderland? Wonderland money, magic internet money. That was very tied to USD actually. OmDAO, Olympus DAO, all of that. So I was like, wow, I'm earning so much every day. This is going to end one day. So I knew it was going to end. So I was always watching it. And one day it started dropping, dropping, dropping, dropping. And it's so hard to withdraw when it's dropping, right? The network's clogged. So it's like your heart's beating. And it's like, oh my God. It was so fun at the same time. It's like a gambling addiction. if you think about it. It is. It's like this 24, I see crypto today because there's so few real world case usage.

1:27:56I see crypto as a 24-7 online casino that anyone can access to from anywhere and because everyone is greedy and everyone is a bit of a gambling addict inside, there's going to be more and more people joining the casino. Yeah, exactly. and you see that with Pepe just like two months ago or a month ago everybody like it's just crazy yeah it's crazy as well it's just endless like people repeat the same patterns over and over again and it's just if you really understand tokenomics and liquidity and all of that and you're seeing the market cap of Pepe going above 500 million and then the liquidity in the DEX is only 5 million you're like ooh you better be careful here like the slippage is going to be huge and stuff like that.

1:28:46A lot of people don't understand that. Yeah, you're playing a game of musical chair and the liquidity is very small and you can architect or design your token to pump when there is no liquidity. So barely anyone can withdraw the money but people just dump the money because they think paper gains are high. Actually, we were doing a lot of private deals and I remember one of these deals we did, like they explained us that i mean you probably know it too because you launch your own token when you launch your own token like the market maker actually went to the project and said how many x do you want that launch 30 40 50 x and they're just going to offer the liquidity at the 30 or 40 or 50 x that you want but obviously the more the higher the more it's going to crash afterwards but like the whole thing is kind of architected and designed and it's a super crazy and interesting at the same time but like a lot of people don't understand yeah yeah they get completely burned because of that yeah that's why that's why uh you need to be early and you need to get out early the thing that's why i did this fractional real estate marketplace because i wanted to give people a safer way to invest in this industry through a steady i call it stable coin plus yeah because it's stable it's property and then you're getting yield which is sustainable yield because it comes from rent.

1:30:11From real money. And then every year, that stablecoin goes up in value because it's an asset that appreciates. So yeah, that's like my little anchor protocol but sustainable. Stablecoin Plus. What can go wrong? What could go wrong for someone who invests in this app? You can be careless and get hacked. you can expose your private keys to someone get hacked there's a lot of scams out there you probably go to the wrong site instead of our site they scam you but ours we have KYC everyone has the KYC so that's our anti-scam mechanism what can go wrong? if the company fails what happens to my ownership of my assets?

1:31:02there's no company so the seller can be a company that's true or an individual. When they go on the sale, it's in an escrow. So if they don't hit the soft cap, the money's returned. It's all smart contract, right? So we're not, the code doesn't lie, so you can see it. What else can I go? I mean, it's really, you know, probably a hack. Which happens a lot. Yeah. What's one of your biggest fuck-ups in life in general? I lost my finger when I was seven. I blew it off with a firecracker and I'm like, fuck, fuck, I'm so stupid. Why did I do that? So I always regret this because whenever I look at it, I'm like, oh, such an idiot playing with firecrackers.

1:31:55Still didn't prevent you from doing swimming, actually. Were you using like a fake? No, I didn't. I mean, that's why I'm a long-distance swimmer because it doesn't really matter in the long run. But in the sprints, it does. What fuck-ups? I man a lot. I have a lot of fuck-ups. What's the one that you learned the most from? Blockchain. So the CTO thing. CTO thing. Also, I tried to get into gaming. I fucked up big time there because I don't know anything about gaming. So I tried. You tried to get as an investor? I wanted to do a tree planting game in the real world and in the metaverse. But I didn't realize how expensive it is to get into gaming.

1:32:47So I ran out of money doing it. So I'm like, fuck, why did I do that? I could have used it for this thing. What else?

1:33:02Probably drink driving and crashing my car. I'll never do that ever again. I did that when I was a teenager. What else? Yeah. Yeah, I mean, a lot of it is in the last three years, actually, trying to launch projects. I tried to start my own decks. So basically being almost too, like that's a classic thing for entrepreneurs, especially if you own a lot of things, like you're being too spread out instead of like doubling down on your strength yeah you're like the classic thing i'm getting bored yeah i want to do something else i want something else i want something and then realize man like yeah i'd rather double down on what i know already because i can even know more and maybe it's a bit more boring but because the value in everything comes from compounding i'd rather like focus on that and get even deeper yeah with my connections and my projects and my investments and everything instead of always trying to do something else except if I have some kind of play money to lose yeah but it's you know it's still it's still itching to like just right to lose it sometimes I could have used it to pay for my kid's summer holiday with me like oh damn it yeah or you know something like that what's what's the best piece of advice that you've ever been given?

1:34:21So,

1:34:25I still use it until today and it's a very basic principle in economics and what my professor told me. He says, the world has limited resources, just how to figure out how to maximize that. And so I use it in everything I do in life. Minimum effort, maximum reward. 2018. Yeah. 2080 rule. Yeah, exactly. Yeah, kind of like how can I be as lazy as possible? Correct. Get the best. Entrepreneurs are very lazy. I mean, they work like crazy, but they will try to do like, how do I do the least and get the best result? 100%. Correct. What's something you believe in that most people would not agree with?

1:35:09Ooh. I believe they're aliens. Okay. Yeah. I believe there's more beings out there in the universe, and there's aliens, and I'm sure there's aliens among us. Yeah, I believe there's another form of life out there. That makes sense, actually.

1:35:32What's a belief that you have, that you learn, and that is just growing every day more and more? Oh, so I always believe in working hard and working smart. So I always believe if someone is sleeping and you're putting more hours working or you're learning more, you'll do better. And I see it all the time. I'm 47 now and I still work hard. I work 12 to 16 hours a day and I love it. And the competition is not. And I go, I haven't. Yeah, so outworking. Yeah. So basically the whole thing is maybe I'm not outsmarting you. Maybe you're smarter, but if I outwork you, I'm going to win. Yeah, maybe. Hopefully.

1:36:20Hopefully. You tell this to yourself. I try. Exactly. Because you can justify that you work all this time. Yeah, because I'm not the smartest. That's what I know. I also believe in hanging out with smart people. So if I do that and I have people, smart people around me, and I work harder than them, I'll hopefully have an edge. Yeah. That's a big thing in sport, actually. Like the talent is one thing, but if you don't like practice, practice, practice, practice, practice you're never gonna true be at your full potential true um if there was a key takeaway from today what would it be key takeaway from today uh fractionalization is amazing actually it's an amazing concept think about real estate or art or whatever things that people could not afford before that you can increase the liquidity and like offer this kind of investment to everyone I think that's really amazing.

1:37:11I think that's a really good takeaway. Also, the key takeaway is also learning from you. You were like me. When you lose money, you become hungry. We're all human. We're not invincible. Shit happens. You just have to live with it. Just pick up, fall off the horse, get back on the horse. Actually, the name of this podcast is Shift Happens. Oh, no, really? Yeah, yeah. Oh. Yeah, so we're rebranding everything. and it's basically shift happens but it's definitely play on word that shit happens and shift happens. Well, there's a huge shift happening in the world today in banking. I mean, there's a lot of tension going on.

1:37:58Thank you so much for this, Berwin. Yeah, thank you. Where can people follow you and connect with you? I'm so funny. I'm not really in social media so much but you can follow me in my Twitter at Berwyn Tanko. My Instagram is private. I think, I mean, we have a YouTube channel in Ekta. So if you follow our socials at Ekta Chain. Ekta Chain everywhere. Twitter, Instagram. If you go to ekta.io all the info is there. If you want to learn about fractional real estate is there. Just keep clicking. We have all our socials. awesome thank you so much for this that was awesome this was fun