Jason Calacanis: all right everybody jason is out sick today so no live stream but uh light a little candle for him because he's not feeling great there was however some crypto news that we couldn't miss out on so i'm doing a solo show all about crypto i know i didn't see that coming either meta just announced that it will be taking a 47 and a half percent creator fee on the platform as in if you create digital goods on the meta platform you will pay meta 47 and a half percent of whatever you sell it for and that is not a typo nor did i misspeak we will go through the arguments for and against this but i think we can also assume it's a pretty big opening for apple or microsoft who come in with a smaller fee and then some news a16z's head of crypto investing chris dixon is number one on the forbes midas list that came out earlier this week and then finally jason and i sat down with world coin ceo alex blania to talk about his crypto project you might have heard about world coin this is the organization that is scanning people's irises in exchange for free crypto with the intent to distribute a token to everyone in the world there has been some controversy about this recently but alex was a great sport we went super deep in the interview and it's a great crypto show

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Jason Calacanis: investing today all right let's do a little bit of news today basically because it is an all crypto episode of this week in startups and both of the news stories that i want to highlight today are related to making a bunch of money on crypto first of all there have been reports that facebook will evidently be taking a 47.5 cut of all transactions in their horizon worlds metaverse i think i saw this in casey newton's newsletter and also on cnet uh nft twitter is to put it mildly pissed but we do want to clarify a couple things about this one 47.5 of anything is a high fee no doubt about it in the digital world however and this is important to note horizon world's creators won't actually be selling nfts meta right now only lets people sell user generated skins and animations basically the kind of thing that you could buy in fortnite however if you compare this to other nft enabled metaverses or even any other digital goods marketplace it doesn't look great and then when you look at nft specifically decentraland and sandbox which are both blockchain based metaverses with nfts they charge creators two and a half percent and five percent respectively openc takes a two and a half percent cut of each transaction on its platform cnet noted that many nft creator take rates fluctuate between two and a half percent and seven and a half percent so again a massive discrepancy apple which has obviously gotten a ton of negative attention for its 30 app store fee is still charging 17 percent less on those triad transactions than facebook is so here's a quick breakdown of facebook's fees for every item sold in horizon world's a 30 cut goes to meta via the oculus platform and then 25 of the remaining 70 goes to the meta app store so not only is it high that all adds up to that 47 and a half percent it's super confusing on top of that punk 6529 which is a popular crypto focused anonymous account tweeted the following the future of work is giving meta 47 and a half percent of your salary apparently okay let's do a little bit of a reality check the 47 and a half percent number looks completely insane on paper it is objectively very high apple's 30 app store fee also looks really really high on paper but facebook much like apple would argue the following most likely i don't think facebook has responded but we can assume that something they'd be likely to say includes the fact that the cost of manufacturing and selling oculus headsets and also creating a fully immersive digital world is so expensive that it validates this much higher fee for using the platform last year facebook spent 10 billion dollars on reality labs projects that's the oculus segment and then according to the verge facebook now has about 18 000 people working on reality labs so spending a lot of money on this the same goes for apple getting over a billion iphones into people's hands while creating this what they call safe and secure version of an app store and to be fair it really is right the well curated highly secure app store did create an ecosystem in which developers could get paid for making apps which had never happened before in january of this year apple noted that 600 million people use the app store every week across 175 countries and that quote developers selling digital goods and services earn more than 260 billion dollars since the app store launched in 2008 that is a side note more revenue than starbucks generated over that time period so what these two big tech giants are saying is we're creating a platform that no one else has the scale and resource to create an insane investment in capital and time developing hardware maintaining this app store and then in facebook's case creating a digital world on the other hand these marketplaces like openc that are charging two and a half percent take rates for example have a really really low operating cost comparatively meta's platform also supports developers who are making money from selling apps that people actually use we had ryan engel on the show in episode 1322 he's the founder and ceo of golf plus which makes the quest vr game called pro putt he told jason that he was happy to develop for meta and pay the meta quest 30 take rate because they had real users paying real money meta recently put out vr sales figures and the quest marketplace has crossed over a billion dollars in all-time sales in february 124 apps earned more than a million dollars in yearly revenue and eight earned more than 20 million dollars with 350 plus total apps in the store so all of that goes back to this sort of potential argument that without a marketplace to make money no one would make any money and so meta is saying we're giving you a chance to make money and we're taking you know our share um chamath uh you know him as an all-investee once shared an anecdote actually from bill gates saying a platform is when the economic value of everybody that uses it exceeds the value of the company that creates it then it's a platform so i guess we're headed in that direction i wonder what you think have we convinced you with the devil's advocacy is 47 and a half percent a fair take rate given facebook's tens of billions of dollar year uh per year investment or will creators continue to mock it i'm assuming given the little that we know about the nft universe that they're going to continue to mock it but i guess we'll see another quick note related to crypto forbes released its annual midas list earlier of the best or most successful vcs in the world and the number one venture capitalist number one in the world for the first time was a16z's chris dixon you know the one who leads the a16z crypto investment team so all signs point to crypto being a winner in early 2022 it was reported that dixon was raising four and a half billion dollars for new a16z funds on top of the 2.2 billion that a16z crypto already raised in 2021 dixon of course had a huge hit with coinbase going public in 2021 and had invested in every single coinbase round is how committed he was to that company and it paid off nicely he was also an early investor in oculus before it got acquired by facebook i'm sorry meta so what does this all mean i mean i guess it means there's a lot of money to be made in various crypto projects right now and again like i've been saying the people who understand it are the people who are in a position to make money from it right now and yet there's still a lot of uncertainty about what it's all going to look like in the future and that gets us into today's interview with world coin ceo alex blania this is that crypto project that we've been talking about that's been scanning people's irises in exchange for free crypto and has run into more than a little bit of controversy as a result we have a little bit of a good cop bad cop situation with me and jason we get into it with alex and he was a very good sport for coming on and explaining in his own words what

SPEAKER_14: world coin is trying to accomplish so let's get to that interview enjoy efficiency is one of the main

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SPEAKER_21: startups to help them optimize and support all of your documents go to coda.io slash twist to get one thousand dollars in credits i kid you not thousand dollars waiting for you at coda.io slash twist hey everybody welcome back molly and i have a great guest today uh we've been watching this crypto project for well over a year i thought this was a fascinating idea i said so on twitter and i am a

SPEAKER_25: crypto skeptic but a friend of mine sam altman is associated with the company in some way we'll find out in a moment but the company is world coin you can find them at world coin.org and the founder is

SPEAKER_26: alex blania and welcome to the program alex thanks for having me excited to be here thanks for coming

SPEAKER_14: on now obviously in that year since we everybody has been talking about world coin i think it's fair to say things have gotten pretty interesting there's been a lot of press maybe a lot more press than you

SPEAKER_31: would have liked alex is already cringing tell us before before we dive into sort of the the controversy

SPEAKER_14: though tell us about your vision like what is your intent for world coin and what are you trying to

SPEAKER_34: build i think a little bit of history kind of context about the project certainly helps here so sam back then had this very simple idea of what would happen if we could launch a token by giving ownership in a token to really every person on earth simply for being a human right like this would be a dramatic reset it would dramatically accelerate the transition into into crypto would create this big network um and that's exciting for many different ways he certainly came at it from

SPEAKER_36: this ubi perspective back then right kind of ubi will have to make it work in the coming decades probably and we're so basic um we should clarify for people don't know yeah correct correct correct

SPEAKER_34: and even if roll coin cannot fully solve it it can certainly be the infrastructure for that so this was the very simple idea launch a new token give ownership in it to every human on earth we started thinking about it deeply and realized that the first fundamental problem we will have to solve to do this is what is called proof of unique humanness and that's a different thing than

SPEAKER_40: identity it is basically you can prove to a protocol that you are unique to the protocol without

SPEAKER_34: revealing your identity and that would be a very powerful thing to do so you can log in wherever you are you can say okay i'm unique to this service not only roll coin say i'm unique to that service

SPEAKER_40: i've not used it before that is a very critical thing to solve especially for roll coin because if we don't solve that the system itself is not what is called civil resistant meaning one person can claim if it's a malicious actor multiple of those shares founding shares in roll coin and that can be thousands of them so that the whole system would immediately break down right so you really really have to solve that and it's a tough nut to crack uh it really really is much harder than it sounds initially because you really want to make it work everywhere uh it should work from norway to africa uh for for truly everyone just for being a person so

SPEAKER_34: it's a very complicated technical question as well we will talk more about that i guess

SPEAKER_42: so you said the term is proof of human ness we call it proof of personhood like other people in the

SPEAKER_43: ecosystem called it called it proof of unique humanists so proof that you're a one-of-one human

SPEAKER_45: on the planet as opposed to how crypto works today proof that you're a wallet proof that you've that this wallet exists in the world which i could wake up today and make 10 000 of them with a bot you know it costs a little bit of money i guess so that means how do you get proof of humanness i guess is the next card and then did you look at multiple concepts to doing this to get to the one that you chose um will you have others yeah and so let's go into that because that's where this idea i think in people's mind starts to become like a james bond villain concept as opposed to what i obviously your intent is which is to just give everybody participation in a global crypto project so let's

SPEAKER_40: talk about how you got to the certain biometric you're using right so as a as a first kind of just to set the stage building our own hardware and i think you brought this up so we came to the conclusion

SPEAKER_34: that we need to build our own hardware that basically uses biometrics plus what is called the knowledge proofs in crypto um to issue that proof and we will talk more about it what that actually means but we obviously in the beginning we did not want to build our own hardware because when you're a

SPEAKER_40: a small startup this sounds like a crazy endeavor right so this was not at all what we would be hoped the outcome would be so basically we looked in many different ways to solve the problem and uh well it starts with the with the fundamental ones like kyc um it goes on to with like know your customer know your customer so you basically call someone you show them your passport and there's a database with your passport and basically an api that connects the database to whatever service you're using well looking deeply into that if you really want to make it inclusive for everyone that just fundamentally doesn't work because for many parts of the world it just does not work so we kind of excluded it quite quickly things like email addresses phone numbers all of those things they are not civil resistant enough so they would immediately break down it's relatively easy to create multiple of

SPEAKER_34: them and then there's another thing we look quite deeply into which is called web of trust so you basically try to analyze a network and you try to allocate different trust vectors to everyone into

SPEAKER_40: network and you you try to understand like who is actually a real person there versus a bot um almost like a kind of credit check sort of yeah i mean like basically every social network is doing that in their back and in some way like facebook has a big team uh working on things like that there's some

SPEAKER_34: crypto projects working on this but the tldr is it does not yet work at least there is no functional

SPEAKER_40: prototype on a large scale uh it's really hard to bootstrap which is i think the hardest problem you kind of need trusted seats what is it called like you need people that you can trust these are real people and they they can then start verifying each other so like if i have your passport is how

SPEAKER_45: yeah this started like the new york times said i'm sorry google said hey the new york times nasa whitehouse.gov whatever they'd link to they're not going to link to something that is horrible so page rank 10 was these top sites page rank 9 was the who they linked to and so on and so on they created an algorithm for that so we get that and the zero knowledge proof for people who don't know is the ability for me to convey some information to you a counterparty on a transaction let's say some piece of information without giving you that piece of information in this case it's i'm jason calacanis and she's molly wood and we did a transaction she knows it's me i know it's her or um i have the amount of money in my account to cover this transaction without sending her my bank balance right it's just a way to say the zero knowledge proof is you have zero knowledge of the underlying data but you do know the answer to the question is that a good way to explain that this is a brilliant

SPEAKER_40: way to explain it i also really like the the page rank analogy because that's very close to the original papers on this whole topic so that's that's a really good one at the end of the day though you were like none of that is good enough we got none of this is good enough and um basically they're but biometric is just a fundamental solution to that right like if you just you you you don't talk about specific problems you just okay you take something that makes a person unique uh like

SPEAKER_64: biologically and you you use that as which is why passports now are moving to that when you go in and out of a country they're they're checking your iris am i correct in some instances like not every

SPEAKER_40: country but i think the um kind of a really good example that is certainly at har so in india if you want to be part of the social welfare system or actually i think at this point almost everything you you want to do on a national level you do that with your at har card so basically indian government has realized at some point okay we have a big corruption problem it's really hard for us to keep track of identities so they rolled out what is called at har and they used biometric um

SPEAKER_34: methods to do that but knows your knowledge proofs so this is um so this is occurring in india today

SPEAKER_21: they have a system called adhar a-a-d-h-a-a-r that's a 12 digit unique identifier that's obtained and you have a card it's sort of like your social security card but it's linked to a biometric correct correct

SPEAKER_45: correct yeah they did this because people were trying to scam whatever welfare or whatever system

SPEAKER_71: it was food banks whatever yeah got it biometrics are the solution but then you're like oh crap we're

SPEAKER_73: in the hardware game right but but actually you're not fully there yet because you can think about

SPEAKER_40: whatever maybe we can use phones maybe we can use like um already existing hardware but then there comes another really tough one which is all the systems you use in your daily life uh if it's face id if it's the fingerprint sensor new door all of those things they're basically a one-to-one comparison all right so basically your iphone knows okay this is how json looks like there's an embedding stored somewhere on that phone json tries to lock in again new embedding is created compared to this one previous one if that matches you can use your phone and do whatever you want for this whole proof of personhood or proof of unique humanist however you need to create a new embedding and compare it against everyone else before so it's a one-to-one comparison and those error rates basically explode so uh if you were to use a phone a face id or similar technologies after 10 million people max at least that's that's what we calculated um you would reject everyone because you could not distinguish them anymore there's just not enough information about everyone that makes total sense

SPEAKER_45: so it's it's fine to use face id to open your phone the chances of it being confused are one in millions but if your goal is to put 7 billion people on a global cryptocurrency that means if it was one in every 10 million you would have whatever that is 100 every billion you'd have thousands of mismatches and that could be somebody's entire that could be some catastrophic issue correct yeah actually actually

SPEAKER_40: it's actually much worse than that because it's not that um you just continue to scale and you just whatever one one in a one in a 10 million or something reject them but rather after some scale you just have to reject everyone because you cannot distinguish them at all anymore ah god so it's even you basically just hit a wall basically there was there was the other other big insight and so we realized okay we really have to build our own hardware and the only biometric identifier that really works on that scale is the iris so the muscle of your eye has a lot of information in it entropy is how you call it like mathematical information and it's it's non-invasive and it's it's very kind of easy to image in that sense so we realized okay that's that's the that's the path to go down and you cannot even use normal iris scanners for that uh so we really had to build our own lens we had to build on an imaging system to get to the resolution we need um so so anyways that was that was the first big problem we really have to solve is this is this this proof of personal problem and if you solve that and you have a unique token you can really start rolling this out on a really large scale and you can build many many other things in the future listen when

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SPEAKER_25: that's odoo.com twist so did the normal irish scanners out there work or were they just

SPEAKER_34: did not high fidelity enough is that the issue they do not have high enough resolution because again most of them are used in this other use case where you try to line to somewhere just trying to open your

SPEAKER_45: door so it just needs to know that you're close enough to your door correct right right so you made

SPEAKER_87: this device uh tell us about the orb we made this device it's a really cool device at this point it's a

SPEAKER_34: 20 centimeter sphere it has a custom lens in there to to make that that image of your eye that is

SPEAKER_40: high enough resolution to make that comparison work it has a lot of security sensors in there

SPEAKER_34: as well because that's the other big problem you have to address or like one is just checking uniqueness the other big problem is uh people will attack the system as as much as they can because basically if you succeed with your attack you can create multiple identities you can get

SPEAKER_40: multiple of those tokens and you make money right so it has a lot of hardware security features and what we also call presentation attack security features in there so basically there are neural networks on that device that check that you are a real person not a display um or or something something else

SPEAKER_45: and you've started to pilot these orbs where are you at with that um i had heard that you know like a hundred thousand people had their eyes scanned already i don't know if that's true or not but i saw some headlines go by uh how many orbs did you make and then how many people have you scanned because

SPEAKER_25: i know the coin's not out yet so you're kind of scanning people as a test or something and then

SPEAKER_67: with the promise of future coins okay so let's actually take a step back i think it's important

SPEAKER_40: to understand right so there's a token and there's a there's this platform basically proof of personal that any anyone else will be able to use by the way it's an open protocol it's not only for the welcome token so you build a defy app you can just use that welcome login identity so these are the two things that exist and for this proof of personal we built this orb but this orb is not operated by us as a project or a company but rather like from from people all over the world that earn roll come with every sign up they initiate so it's a decentralized model um and that turns out to work really well uh it's of course really hard to to kind of deal with all the edge cases because there will be many of them but that's the general idea so like facebook connect if a website wants to use

SPEAKER_45: linkedin login google login facebook login twitter login if i make a website a bank or whatever i could

SPEAKER_25: use world coins login and i could do that for free or i have to pay a couple of world coin tokens or something to authenticate each person what how does that work like like this whole monetization we have

SPEAKER_40: not figured out yet because it it will really depend on how people end up using it um in in most instances but but that's generally correct so use a user you receive basically two set of keys one for your token and one for your identity your proof of personal uh and and everyone else as you say as facebook login can just integrate that in their app in their in their product and then probably you're right they will need to pay some world coin to how many world coins will there be did you it's

SPEAKER_71: going to be a trillion world coins it will be you know a hundred per person 700 trillion or a thousand

SPEAKER_34: per person there will be 10 there will be 10 billion tokens uh ever created so it's a cap supply system

SPEAKER_107: and 10 billion 10 billion and you came to that number because that's in our lifetime how many

SPEAKER_34: humans will be around or something basically we we realized in the beginning we need around 20 percent of of the circulating supply to actually fund the whole operation to really get it off the

SPEAKER_78: ground and then you have eight eight billion left which is as many people are there got it so

SPEAKER_107: what when will the tokens launch and what will how will you price them initially or does a market just

SPEAKER_40: pick the i mean the market will just price them and we will launch them later this year and this will be

SPEAKER_21: a a big event to watch out for for sure uh are you selling those tokens in advance the 20 to fund the project are you selling those to venture capitalists like in treason horowitz etc who like to buy these

SPEAKER_40: tokens yes that's correct have you sold them yet um i mean it's it's actually equity rounds right so those those those investors they buy equity in operating company and then later uh they can choose to buy tokens as well with a warrant a token warrant got it what what will you put those tokens value at uh

SPEAKER_71: for them at the start because this has been a point of contention like oh the vcs get to get first shot at the tokens that's not fair crypto is supposed to be fair uh i don't know why people expect crypto to be different than corporations but um what what will you price them at if it's two bill if you have 10 billion tokens you're going to sell 2 billion to fund the project you just

SPEAKER_25: charge a dollar each and raise two billion dollars 10 cents each and raise 200 million i mean i cannot

SPEAKER_34: talk about the actual valuation right now how we do that but basically it's it's it's with a normal

SPEAKER_40: funding round right investors look at technology investors look at the data we have and they try

David Friedberg: to think about the upside of this project got it so i would guess well if it's a billion dollar company out of the gate 200 million if it's people value it at 10 billion it'd be 2 billion so between those two numbers perhaps uh is where you wind up and that will fund you going out and scanning all these

SPEAKER_71: people's uh irises and then how many tokens will they get they will get one token each is the idea

SPEAKER_25: and they'll be like one bitcoin essentially and then we'll see what a bitcoin is worth in the world and you reserve one per person for everybody on the planet so so two two important things here the

SPEAKER_99: first one is um the users they will not receive a one like one time token basically but rather you

SPEAKER_40: receive a continuous flow over multiple years and we have not locked this in yet because we're still

SPEAKER_34: like it it really depends on on those testings we can talk about in a second but we have not locked this number in yet uh so user user you sign up for real coin and you know how many real can you will

SPEAKER_40: receive over the coming years and then basically every week you get a small part of that got it so

SPEAKER_45: if this word will be looked at like a bitcoin because you're making one for each person essentially if it was a bitcoin they would get a hundredth of a bitcoin a year maybe it increases when they're retired because they would need more money then could be one concept i don't know how it could work maybe you get you know 50 basis points for your first 20 years on the planet or maybe if you're in a country where you needed the money because of prenatal or like early stuff maybe people in africa who maybe need the money early for education get 10 a year for or 5 a year for the first 20 years of life maybe in a developed economy you get 50 basis points and then you get the bulk of it at the end where retirement is the issue because it's an aging population all of this would be amazing

SPEAKER_34: ideas um in general right now it's it's really thought as this one one rule that is the same for everyone for everybody yeah everyone will have the same unlock schedule jason keeps that

SPEAKER_64: sure enough well no i mean the option no it wasn't even vip i was actually thinking more

SPEAKER_45: you know there what a person in europe needs might be distinctly different than you know what a person with a shorter lifespan right in somalia needs like wherever the shortest lifespan is giving them one you know one two percent giving them two percent a year where the lifespan might be under 50 in some

SPEAKER_134: places right that's not good they need they need early when they need to get education if they were going

SPEAKER_57: to spend it on such things right oh of course but i think um here it's actually really important

SPEAKER_34: to just state again that what world can does it gives access to all of those people and all of those people end up with fundamentally an identity and a wallet and everyone else can access it too

SPEAKER_40: so even though that is the economics of the world kind token there might be other tokens that launch under welcome protocol with different economics to solve different problems

SPEAKER_142: oh so it it is really really like the first step to get this kick started and then world coins for

SPEAKER_21: identity but then in a developing nation if they were if they wanted to give ubi to a certain group of people they could do like where they call those erc 20 tokens or something off of ethereum so there'll be some sort of concept like that somalia or italy could have a different token or india could have a

SPEAKER_34: different token than you even you could you will be able to launch the jason token and give that jason token to every human on earth because you think this is how it should be fascinating

David Friedberg: listen pretty much everybody knows someone who has invested in crypto at this point

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SPEAKER_153: about some of the controversy that has a ribbon has arisen right has there been a controversy yeah

SPEAKER_157: i couldn't expect that standing hundreds of thousands of people's irises and giving them free money would

SPEAKER_31: cost any kind of attention but well one one question about the the giving them free money is that

SPEAKER_14: the token hasn't launched yet right so the the the payment as such that people are receiving for having their irises scan like talk to me a little bit about the decision to build out the iris scanning first and then compensate people with a token that does not yet exist i mean first and foremost they

SPEAKER_40: actually will receive um something relatively soon but you really have to think about it in a way

SPEAKER_65: you you have a company you have a project that needs to build many many things at the same time right so one is the technology it's a completely new hardware device that doesn't exist yet uh that

SPEAKER_40: itself is extremely complicated uh then you have a a growth mechanism that is distributed so you have people all over the world that used it or to to basically verify other people right and there's many

SPEAKER_34: many economic mechanisms around that to actually make that work and make it click and like how to set up the q and a around this and all of those things so this is this itself is very complicated

SPEAKER_40: then of course you have you have an app you have a protocol all of those different layers of

SPEAKER_34: technology you have to make work at the same time so basically what happened in the last in the last few months is that we tested different parts of of those system in in different parts of the world for different reasons and we just we have been in a quick test testing mindset so the number of orbs has been quite low it has been a total of around 30 sometimes 40 of early prototypes and even those devices they change right because we we went up in iterations of those devices and then we just try

SPEAKER_40: to cover as many parts of the world as we can possibly do in the shortest amount of time and understand what works with different people but what is really really hard concepts to get across and what is not right like how does the app need to look like or if you have if you interface i think the till the hours in norway things work quite easy but if you talk to people that have never heard about crypto and you need to explain them what is a private and public key first uh this has many applications on your product so many many things that that have to have to be tested and have to be done right uh in a short amount of time on a global scale right and that is

SPEAKER_34: basically what happened so um on the the point you just raised this was actually just one of those tests right for example in norway you have different tests very tested the app uh or or things like that and another important point is that we actually don't need that biometric data uh but rather does the optics work in sun or in snow like that's like all of those different things you just you

SPEAKER_166: you cannot simulate that so of course people felt like yeah it's a test but people felt like they

David Friedberg: were going to get coins so maybe they just felt like they should have gotten them now i mean you could just give everybody a dollar for doing it like just and that is what we will have what will

SPEAKER_40: happen basically in the coming i think three weeks it's basically all of those people they just receive some ethereum uh okay and some and some other tokens so whatever in their wallet if they figure out how to log in and they also will of course receive real coin later on and they even can claim broken again when it actually launches so great they're they're the happy people

SPEAKER_14: and so all right so let's talk about privacy don't have their wallet to be fair several of them

Chamath Palihapitiya: didn't report that they lost but if access to their wallets oh but if they use their iris can't

SPEAKER_57: they reset their wallet yeah they can just reset it um especially those people uh so that might be

Chamath Palihapitiya: tech support issues yeah yeah early stage tech support issues so okay well let's let's dive into

SPEAKER_87: the privacy issue i give you this iris you have my iris it's encrypted somehow what if you get hacked

SPEAKER_45: like this is i guess people's great concern and then yeah so there's that there's the pragmatic one of hacking and then there's another one which is what are you telling people in the terms of service you will allow to happen with my iris if the federal government says or if india's government or an authoritarian government china's government says or they subpoena you and say give us these 10 people's

SPEAKER_71: irises we think they're terrorists and they're actually journalists are you going to give it to them

SPEAKER_179: can you give it to them we we can't um explain that technically why so yeah so let's let's

SPEAKER_34: understand the basics because that is really important to get right so so a few statements up

SPEAKER_65: front one is roll coin is in fact i think the most privacy preserving way to solve that problem to date like much more privacy preserving anything you use your facebook login your google login all of those

SPEAKER_34: things and i will explain in a second why second um we really do not want to do anything with

SPEAKER_65: that biometric data in fact we're incentivized to stay as away from it as far as we can for obvious reasons because that is not core of what we're doing core of what we're doing is we just want to solve that one problem and move on everything will be open source so uh there is uh we have clear

SPEAKER_40: aligned incentives in that direction so let me talk now about the technology um basically what happens is you go you show up in front of an orb you want to be verified you want to get your vulcan account the operator which is the person using the door presses a button uh 15 seconds later you're basically verified and uh you get your your account with your proof of personal and your your welcome tokens in there what happens on the backbone though is on that orb locally there are

SPEAKER_34: many neural networks for many different reasons uh many of them for fraud detection but

SPEAKER_40: let's talk about identity part first so iris is imaged a local hash is calculated out of that iris image and what that what it implies in the first case is you cannot go back from that iris hash to the

SPEAKER_21: actual iris image so that's that's a one-way function so it creates a number hash is a fancy

SPEAKER_14: way of saying a long number based on my eye and my iris and then the number is unique but you can't reverse engineer the number into an eyeball or an image of an eyeball yeah correct so and then that is

SPEAKER_40: the only biometric data about you that is leaving the orb it is sent to also a blockchain so not a central database but another blockchain where it's compared against all the other people that have signed up before that and then what happens on the user side of things on your phone is that the user is proving with a zero knowledge proof uh plus that blockchain that that user is included in that kind of uniqueness blockchain right without revealing who the user actually is so that means let's say we let's talk about the worst case even if i would have uh molly's iris hash i would have no idea what your actual account is on the blockchain side and the same is true for any other service so whatever you log in in a defy app or you whatever even a conventional service that service will never know who you actually are just that you are unique to that service and that is

SPEAKER_65: a very very powerful thing i believe right so it's in a in a i have a follow-up question about that

SPEAKER_14: real quick related to like a lost wallet right if it's all anonymized and all you have is this hash and you're just in this mess that says you have signed up once before and you go back and you're like i lost my wallet scan me again so i can prove i'm here isn't that not going to work because the idea is you can't be scanned more than twice more than once but also your identity is not connected to this hash

SPEAKER_192: right wallet reset does not work that way but identity reset works that way so you lose your

David Friedberg: wallet so just like in crypto you hear horror stories of people losing their wallet with five bitcoin in it

SPEAKER_45: that's on you so you get this added security but if you don't have your backup code or whatever to

SPEAKER_14: unlock the wallet that's on you so how is anybody who right so anybody who was scanned in these tests who then and you know it seems like it in some cases it was happening in countries where and in

SPEAKER_99: places where people had very low familiarity if they lost their wallet they can just sign up once

SPEAKER_142: more because we basically i mean these have just been tests right there is no reason why we actually

SPEAKER_197: why we actually start those hashes so during the test they can just sign up again there's no coins in the

SPEAKER_45: wallet right now but when the coins are in the wallet the wallet would be secured right by two factor a password whatever somebody chooses like a standard email account right you have the same you

SPEAKER_198: have the same procedure as you have any other ethereum wallet basically so if you lose it it's on you

SPEAKER_14: if there's stuff in it so all the people who have been scanned so far are effectively like they're just training data but they're sort of non-persons with respect to wanting to

SPEAKER_188: sign up again in the future all of them will be able to sign up again once the actual mainnet

SPEAKER_65: launches and that's important for many reasons right like the product was not perfect in many different ways like many of them maybe you didn't understand it because all of those different

SPEAKER_31: reasons right so but what were they compensated with they they presumably were compensated with a

SPEAKER_65: token so if they keep it or some fraction then they get more and that's fine then they get that token they get for this for this initial test sign up plus the one that actually happens when the

SPEAKER_209: main so they get paid twice they get paid twice and that's fine okay yeah i mean i think there's also

SPEAKER_45: going to be expectation of well if i did this do i get a 40 000 bitcoin like people's in people's minds i think they're thinking molly right well i got one of these i was one of the first people to sign up now it's going to go on a tear and it's going to become worth you know what ethereum's worth the

SPEAKER_14: fact is i mean what if it did and you just sort of happened to be i mean that is sort of interesting that just because you're in the test then you can sign up twice no one else on earth will be able to sign up twice except for these 500 000 ish people and then if this token is eventually worth 10 million

SPEAKER_215: dollars they would be score yeah great score paid twice congrats on getting in early and being a beta

SPEAKER_209: tester you know you got an extra coin i think it's cool but i mean the truth is if there's 10 billion

SPEAKER_107: coins the chance of these things you know being worth more than a dollar each is going to be low i mean it's it would take a the entire world a large group of speculators would have to think this becomes the most important project in the world and they just run up the tokens there's just a there's a large supply of tokens is what i'm saying i mean it it takes quite some years to get

SPEAKER_34: the full supply right because um basically every every user you sign up gets some broken tokens so it

SPEAKER_40: takes seven ten years depending on how fast we are even can take longer like depending on how many

SPEAKER_65: how quickly we actually are with this onboarding i think it would take seven years if we sign up a

David Friedberg: billion people in less than two years after may not i mean bitcoin's going to be 20 million right or 21 million it's like it's capped at a certain number of bitcoins i think it's 20 or maybe it's 21.

SPEAKER_71: so here you're talking about a much bigger pool right so the idea that they would become worth thousands of dollars i think is you know each is probably not what's going to happen here but this

SPEAKER_107: could be a great identity system for people around the world to to log in i think i think it actually

SPEAKER_67: could be much more right because there are there are many interesting things coming together here like

SPEAKER_34: one is as you say identity but the other big thing is you have this onboarding happening with

SPEAKER_40: those orbs all over the world and they actually lead to very different networks they lead to highly localized ones right where usually crypto networks are like some people in in a country or something sign up for service versus for world coin uh you will get to double digit like numbers of users in a certain location quite quickly right and if what we see in those tests and those numbers are very very promising we actually can get two billion people scale quite quickly that that's our big bet

SPEAKER_174: what do you what countries do you think will benefit from this the most and which ones are you targeting to hit double digit percentages first is it the emerging world is the modern world are you

SPEAKER_34: going to do this in barcelona are you going to do it internally internally like the simple the simple idea is just make it as kind of equal distributed as we possibly can and of course this hits some walls

SPEAKER_40: because like in some places it's harder regulatory wise or even kind of just raw uh growth wise but the general idea we have internally is make it accessible as as much as we can as quickly as we can you're

SPEAKER_87: going to make 50 000 of these devices is a year a year a year it will be who gets the devices and

SPEAKER_45: are the devices like nodes where i can be like an entrepreneur so if i got 10 of these devices i'm getting paid every time i put somebody on is there some sort of i don't want to say multi-level marketing but is there compensation for an individual if molly and i wanted to get one of these each and start

SPEAKER_87: scanning people at our farmer's market and explaining the concept as evangelists is that how

SPEAKER_34: you're going to distribute these that that's that's exactly right so you you receive those orbs you send up people at a farmer's market you explain what real coin is about and why it is exciting

SPEAKER_40: and then those users receive real coin and you receive real coin for every sign up you did right

SPEAKER_235: how many world coins do i get for signing somebody up or undecided that that actually depends on

SPEAKER_40: what what the market price will be at the time because that those operators they have an opportunity cost right it's like one hour signing people up versus working somewhere it needs to make sense

SPEAKER_14: for them so there is a what's happening with the operators now it sounds like there's been some concern about operators who haven't who did get paid in real coin that doesn't exist yet or who are concerned about whether or when they're going to get paid no no all of them got paid that that is

SPEAKER_65: very easy to answer all of them got paid and stable coins right now right because they obviously they they spend time of their life to do this and we just pay them as stable coins perfect um

SPEAKER_31: what do people go ahead ma i mean i are you surprised at some of these stories showing blowback

SPEAKER_14: i mean like obviously you have very well thought out technology-based answers to all these questions and yet that's sort of not how the real world works like were you surprised i mean when you show up with a creepy orb and start scanning eyeballs in developing nations and people aren't quite sure why and they you know think they got paid in a thing that doesn't exist yet like did it surprise you that

SPEAKER_34: there was this controversy i think the part that surprised all of us is just how much how much attention there would be to like a very very early phase of this whole thing right because even all of those stories you just mentioned these have been many months back right so this was when literally the

SPEAKER_40: company was 10 people or like whatever maybe 15 people right in a small town in erlang and in in germany so it was very early in the project and of course many things don't work and i think the the thing that struck me surprised us is how much attention even those like very very early tests got i think the thing that does not surprise us is that it's obviously a very new idea and it will take a while for people to understand all of the implications of this and uh i think it will change quite quickly once we actually launch domain it and start onboarding a lot of people and people realize okay

SPEAKER_65: wow this actually is on track to be the biggest project in crypto yeah i mean if you look at the

David Friedberg: chart that um sam maltman shared back in october october 21st you have uh a pretty quick ramp in just

SPEAKER_107: six months to a hundred thousand people getting scanned and it was operators i guess you call them operators these folks who are taking the orbs out and from chile to indonesia to norway france zimbabwe indonesia kenya india just um different operators going out and getting students on board and people want to do this people want to be involved in crypto so and the operators have figured out a way

SPEAKER_40: to get people out there and it's right and actually those numbers got much better since then by the way

SPEAKER_174: uh um which is where are you at now what's the total number so so this doesn't count the first

SPEAKER_40: quarter of this year yeah so the the thing we look at internally is how many how many signups does one or do on average a week right because then you can do then you can do simple math so right now one is

SPEAKER_65: around between 700 and 800 a week on average the best ones do more than 2 000 a week so wow so even at

David Friedberg: a thousand a week a thousand a week that means an orb can do fifty thousand a year and you're doing

SPEAKER_65: fifty thousand words right and fifty thousand will only be the first year so like basically how the production ramp up works this year end of this year it will be six thousand eight hundred next year it will be well fifty thousand plus six thousand eight hundred so we basically hit

David Friedberg: full production scale in november mid-november maybe not fifty thousand orbs doing fifty just a

SPEAKER_71: thousand a week yeah that's seven hundred thousand a year that means 10 years you have everybody on the

SPEAKER_110: planet it should it actually can go much quicker than that but yeah no i'm just if you got to 500 if

SPEAKER_45: you i mean if you did 500 000 orbs um you would yeah be you'd be able to get there a lot quicker right

SPEAKER_34: well basically if we stay all of this sounds crazy i know that part and let's see uh certainly all kind of saturation effects will kick in and what's not but just following the production schedule multiplied by the numbers we measure right now there's actually perhaps to onboard a billion

SPEAKER_254: people in less than two years which would be significant um is is worldcoin it's a dot org is

SPEAKER_34: it a for-profit company well it will be a decentralized organization right so kind of this whole idea of a

SPEAKER_40: company uh will will not exist hopefully um kind of as soon as as even possible so it will be first all the all the ip will move to a foundation um and then it will be what people call a dow however we really need to figure out what this really means in practice but um all of this technology will be

SPEAKER_65: open sourced and people will be able to build things with that so and instead of getting shares in a

David Friedberg: company that ipos everybody who participates will get tokens so if you're the ceo or the founder or sam could have you know whatever a million tokens if they become worth ten thousand each you make

SPEAKER_71: ten billion dollars if they become worth a dollar each you made a million dollars or whatever you pay

SPEAKER_34: right so so so that is that is the really important and i think also really exciting and cool part

SPEAKER_40: is that all incentives of users investors founders all of them are aligned around this one single thing which is the token and that's also how we structure the whole organization how we structure all of the fundraisers everyone is around aligned around this token and if the project works uh the token will increase in value at some point and it's utility token not a security

SPEAKER_71: right but uh you're only taking accredited investors into the project so you don't have to deal with securities issues i would assume early on that is i mean that is the main reason i think there are

SPEAKER_34: many other reasons why you want to work with some of the best investors of the world um yeah right

SPEAKER_14: how will the this is sort of a dumb question maybe but if it's all going to be open sourced and then become a dow how will the investors and founders make money is it because you'll own most of or a bit

SPEAKER_39: significant chunk of the tokens right you you own those tokens uh more and more people will start

SPEAKER_65: using this whole protocol and so the demand for the token will increase the price will need to increase as a consequence and that's how us and i think you said earlier you had 20 of the tokens would be going

SPEAKER_71: to fund the project and fund the project means the investors and the founders and the employees

SPEAKER_67: 10 goes to the foundation 10 goes to investors pretty much and the founders would be a part of the

SPEAKER_65: investor pool i would assume founders are part of the foundation pool so like the foundation pool got

SPEAKER_107: it okay foundation pool right got it awesome uh this is the brave new world instead of stock options you get tokens and if they appreciate they appreciate it if they don't that is the new thing and then do though do you do they have to the people who are the insiders of the tokens do they have to hold them for a certain period of time do they have a lockup because yeah and then how does that work they can sell

SPEAKER_49: them over some period of time 10 a year how do you how do you mitigate that because we have securities law and so with this new token uh economy that's occurring in parallel to securities law we have hey you can sell in secondary as a private company no problem but when you become a public company you

SPEAKER_107: have to file you have to you know sell them over some period of time there's some regulations what what is the best practice in a private token sale basically you just have a quite aggressive

SPEAKER_34: and long full lockup and then a linear a linear unlock schedule over two years got it so you're

SPEAKER_49: locked up for some number of years five years ten years right and then you can no it's less than

SPEAKER_34: that hey yeah i don't want to comment yeah well what's the best practice in the industry lock up for a year or two and then you could sell yeah lock up for a year or two and then linear linear unlock over two years so you don't have like those supply shocks in the market got it yeah i

David Friedberg: mean that's and people have been pretty clear that's what happened with solana and other breakout projects was that the insiders who bought these tokens had to sell them over time if not somebody clears the whole position in early position it could tank the whole thing right um right which is what happens with lockups for employees and early investors and anything well this is fascinating

SPEAKER_174: uh continued success with it when will people in america be scanning their irises when will people see this at their farmers market or university or as soon as jason gets the orb yeah i'm not going

SPEAKER_72: out and orbing people it's a little too sci-fi for me but i would certainly create a wallet i don't have a problem with it it seems like yeah i mean i think i think the government and visa have a lot more information on me apple has a lot more information on me with my phone right and where i am and chrome with my search history and like it feels like other my isp feels like a lot of people

David Friedberg: have a lot more information on me although a biometric does feel scary in this case it's it's because

SPEAKER_280: it's hashed i think it's less of an issue so when will we when do people in america start getting

SPEAKER_34: scanned well america is actually america is actually an interesting one um because as you probably know with crypto there's a lot of regulatory uncertainty i think is a good way to frame it so you really

SPEAKER_40: do not know as a as a project and as a founder what are the exact rules i need to follow um to launch in

SPEAKER_34: that country so basically we will america last right we will make the identity piece um accessible

SPEAKER_40: quite quite soon um like there will be again betas for uh for developers really really soon

SPEAKER_222: uh but then when the free tokens like even giving free tokens in america lawyers are going to be like

SPEAKER_65: uh right let's see how not clear let's see how that plays out that's right yeah well i mean this is

David Friedberg: i mean i think something i don't know how you feel about as a crypto person but america really needs to catch up here and make the rules of the road super clear because you have all these american

SPEAKER_45: investors who want to pile in and then we we here in the you know people who are investing in private company world have to play by all these crazy rules and i want to say crazy but we have a regulatory framework that is intense um and detailed and expensive and then crypto has a very fluid one and by all accounts it's you know innovation and money is moving very quickly in the crypto space and very slowly in the startup private space entrepreneurs are clearly voting with their time to do this more fluid one and do it outside the united states right no no i think i think you're exactly

SPEAKER_34: right uh the many of the best the world's best investors are here many of the of the smartest kind of people developers are here so it would be i think the us really needs to kind of accelerate

SPEAKER_198: this whole uh thinking framework around crypto and web3 and make it much more easy for projects and

SPEAKER_21: they have to the complication of course is well then what do you do with existing securities law

SPEAKER_71: and i you know i the framework i liked was uh or the framework i came up with so i like it by default

SPEAKER_21: is maybe just scaling the regulation to the size of the project so if you're doing you know a 10

David Friedberg: million dollar crypto project you know you can do 10 million dollars file one piece of paperwork as an experimental project and don't take more than a thousand dollars from a thousand people whatever the math is you know you can take up to a thousand from ten thousand people okay now you want to do a hundred million dollar project you gotta file like you know 10 pages of paperwork and you have to know anybody who does over ten thousand but anybody under ten thousand dollars you don't have to kyc them or whatever and it's a little more fluid right you come up with some system that is you know matches the potential downside or fraud or risk profile i mean this is the part i really do not know how to

SPEAKER_65: solve it the best i'm a physicist not a lawyer so i don't i don't know that part really well but

SPEAKER_166: well okay yeah the lawyers always get paid is the one rule i found and the more complicated the

SPEAKER_45: more they get paid so right more complexity seems to be what will happen uh right well appreciate you

SPEAKER_14: coming on anything else molly you have that you wanted to i guess on that regulation question is that part of the reason that the tests and the beta period rolled out it's certainly yes in norway but also in you know what might be considered developed countries where penetration like crypto penetration and knowledge is pretty low like there is still that sort of outstanding question of why start in these countries where people may not have known what they were signing up for

SPEAKER_34: i mean to be honest this this was actually like this one part i really did not like appreciate about

SPEAKER_65: all of those reports is because the simple answer is just no like we launched quite equally across like we have been in germany we have been in in france and norway and in spain right like but not the us that that's that that's right um and also indonesia and kenya right because the whole idea is to make it accessible all over the world and then you also you should not shy away from indonesia and just start in norway where it's easy so you really have to also start where it's hard why do you have to start

SPEAKER_14: where it's hard if all you're doing is like gathering hashes to train a network to recognize how

SPEAKER_40: oh because because you really need to understand how you how you build your product so also people that do not live in norway but live somewhere else actually understand it actually know what's what is

SPEAKER_297: going on got it you want to solve for hard not just the layouts right because you you right want it to be a world coin not a that's exactly right yeah eu coin or a for example if you really

SPEAKER_73: right if you would only launch in whatever europe you you could do kyc everyone here has passports

SPEAKER_40: all right this is this is the easy part but if you really want to make it accessible for everyone you

SPEAKER_65: have to do new things and you have to really do things that are much harder and this is certainly

SPEAKER_45: the most interesting crypto project i think it's definitely on my list of the top five most intriguing

David Friedberg: thank you so much jason yeah we wish you continued success with it and um it's uh we're going to be watching uh it's it's really fascinating and i'm interested to see where you take it that's a continued success and thank you for coming on the project hey everyone producer nick here

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