Latest / CRYPTO 101 / Ep. 701 The Evolution of Bitcoin: Insights from Jeff Garzik a True Bitcoin OG

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Ep. 701 The Evolution of Bitcoin: Insights from Jeff Garzik a True Bitcoin OG · CRYPTO 101

0:00
[SPEAKER_01]: Welcome to the Crypto101 podcast, presented by Gemini.
0:04
[SPEAKER_01]: Your bridge to the future of money.
0:14
[SPEAKER_00]: All right, everyone, welcome back to the crypto 101 podcast and man to we have a special episode in store for all of you here today.
0:24
[SPEAKER_00]: We have Jeff Garzick, he is the co-founder, one of the co-founders of Hemi Labs.
0:29
[SPEAKER_00]: He's also one of the earliest and most influential developers in Bitcoin's history.
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[SPEAKER_00]: He's been around for a long time.
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[SPEAKER_00]: He's a legend in the space.
0:38
[SPEAKER_00]: And man, Jeff, we're excited to talk to you.
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[SPEAKER_00]: And talk to you not only about Hany, but just about your long history with Bitcoin, you're kind of a legend in the space.
0:47
[SPEAKER_00]: Thanks for having me.
0:48
[SPEAKER_00]: It'll be a lot of fun to chat.
0:50
[SPEAKER_00]: Absolutely.
0:51
[SPEAKER_00]: So welcome back everyone.
0:52
[SPEAKER_00]: It's good to have you.
0:53
[SPEAKER_00]: We hope everyone had a fantastic new year as we are Chugging our way into 2026.
0:58
[SPEAKER_00]: The crypto space.
1:00
[SPEAKER_00]: It doesn't sleep.
1:01
[SPEAKER_00]: It doesn't stop.
1:02
[SPEAKER_00]: There's no holidays.
1:02
[SPEAKER_00]: There's no breaks and you know the first instance of crypto doing this all started with Bitcoin.
1:08
[SPEAKER_00]: And so Jeff, I mean, you've been around again, you're one of
1:11
[SPEAKER_00]: The original architects of Bitcoin itself, you know, you've been around for a while working with a thing.
1:18
[SPEAKER_00]: Give us some backstory here.
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[SPEAKER_00]: What does that mean?
1:21
[SPEAKER_01]: Sure, so let's go all the way back to year 2010, Satoshi, the still anonymous inventor of Bitcoin, had been mining just about solo.
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[SPEAKER_01]: There were one or two other people, but just about solo for a year.
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[SPEAKER_01]: He started mining January of 2009.
1:41
[SPEAKER_01]: And then what I call the great slash dotting happens.
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[SPEAKER_01]: Someone, I would love to credit them.
1:48
[SPEAKER_01]: Their name is forever lost in history.
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[SPEAKER_01]: Posted to a news for nerds website slash dot org.
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[SPEAKER_01]: It was a very popular website to 15 years ago.
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[SPEAKER_01]: If you were, you were mentioned on slash dot your website went down, because you got so much traffic, it was.
2:03
[SPEAKER_01]: the slash dot effect.
2:05
[SPEAKER_01]: And Bitcoin got the slash dot effect.
2:08
[SPEAKER_01]: Someone posted about Bitcoin, the decentralized currency.
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[SPEAKER_01]: And I was a skeptic.
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[SPEAKER_01]: I was a, now this is five servers in an Amazon data center owned by Jeff Bezos somewhere.
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[SPEAKER_01]: Surely it is because in my, my ego, my big computer science brain, I thought, oh, no, there's no way it's truly decentralized.
2:30
[SPEAKER_01]: But it was open source.
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[SPEAKER_01]: So, July of 2010, I saw that post, I clicked, I downloaded the source code and as any engineer can do because it's open source, you look under the hood, you look at the code, you don't trust who this anonymous Satoshi person is and what they said.
2:51
[SPEAKER_01]: you trust by verifying, and that's the whole crypto ethos.
2:55
[SPEAKER_01]: You get proof, you know, it's not about words.
2:58
[SPEAKER_01]: You look at the source code.
2:59
[SPEAKER_01]: I looked at the source code.
3:00
[SPEAKER_01]: I proved myself wrong.
3:02
[SPEAKER_01]: I was blown away.
3:03
[SPEAKER_01]: This is a brand new invention.
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[SPEAKER_01]: And since I had already been working on Linux, the open source, the powers and droid and all the computers and all the data centers, I knew open source.
3:15
[SPEAKER_01]: I knew it very well.
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[SPEAKER_01]: I've been working under
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[SPEAKER_01]: for many years.
3:20
[SPEAKER_01]: So I just jumped right in.
3:21
[SPEAKER_01]: I started making changes, started making changes to Bitcoin.
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[SPEAKER_01]: Some of them were accepted, but my very first change rejected, rejected by St. O.C.
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[SPEAKER_01]: He gave me the
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[SPEAKER_01]: I tried to increase the block size such that we had Bitcoin to the level of PayPal, which was 4,000 transactions a second.
3:51
[SPEAKER_01]: And I was gently explained that, no, this will break consensus, and I was new and learning all this stuff.
4:00
[SPEAKER_01]: But Satoshi kind of explained Bitcoin to me in public, you know, you got a swallow your ego and be humble there.
4:09
[SPEAKER_01]: But that was a funny intro, but I continued to send patches.
4:13
[SPEAKER_01]: It was the open source process of send a patch, get some feedback.
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[SPEAKER_01]: If it's good, it goes into Bitcoin.
4:20
[SPEAKER_01]: If it's not, it gets rejected, it gets revised, that's the standard engineering process.
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[SPEAKER_01]: So Satoshi was a very welcoming.
4:29
[SPEAKER_01]: Satoshi wasn't like, oh, god, Jeff, that was such a crap piece of software that you just submitted.
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[SPEAKER_01]: You know, why are you even on this planet, you know, uh, no, just the total opposite.
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[SPEAKER_01]: Very, uh, welcoming to myself and many of the other folks, uh, because this was brand new.
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[SPEAKER_01]: Nobody ever heard of blockchain before.
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[SPEAKER_01]: So he had to explain blockchain to us.
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[SPEAKER_00]: So when you say that he said this and that he talked to you or can
4:57
[SPEAKER_00]: How does that happen?
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[SPEAKER_00]: How was that possible?
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[SPEAKER_00]: Was it over a, you know, one of these websites, sir?
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[SPEAKER_01]: It was all via public forums.
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[SPEAKER_01]: A little bit later, I did now, you know, in hindsight in history, I have the fortune to, could verse privately with Satoshi over email, but nobody's heard Satoshi's voice, nobody knows what Satoshi looks like.
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[SPEAKER_01]: It was all public forums back in those days.
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[SPEAKER_00]: That's crazy.
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[SPEAKER_00]: I mean, it's, uh, when you think about the number of people who have spoken to Satoshi in regards to the crypto-related things.
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[SPEAKER_00]: I'm saying, you know, over the course of his life, obviously he's anonymous, you know, millions or thousands of people spoke with him not knowing it.
5:41
[SPEAKER_00]: But of the people who know that he was Satoshi, even though you don't know who he was, I mean, you can probably think that it's limited to amount of people on one or two
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[SPEAKER_00]: on like one or two hands.
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[SPEAKER_00]: I mean, that's what I'm thinking.
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[SPEAKER_00]: Like it's probably single digits.
5:56
[SPEAKER_00]: How long were you able to to talk to him for?
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[SPEAKER_00]: I mean, has he gone dark and you guys don't really talk anymore?
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[SPEAKER_00]: Tell us about that because everyone thinks, you know, he launched Bitcoin and then he just disappeared.
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[SPEAKER_01]: it was a it was a slow fade yeah is kind of how it happened but towards the end of 2010 it was clear that Bitcoin had momentum but at the same time it was a little bit of a scary time for software developers you know this is a super obscure reference but in 2010 developer such as myself didn't know whether we were violating the United States laws simply by writing software
6:36
[SPEAKER_01]: There's something called the Stamp Act, and we didn't know that by issuing virtual currency, were we violating the Stamp Act or some of the other obscure laws that nobody has ever heard of, and so a lot more attention was coming in.
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[SPEAKER_01]: There was a WikiLeaks controversy where WikiLeaks, famous league website, they were soliciting donations, Visa MasterCard, Visa MasterCard, cut them off.
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[SPEAKER_01]: And someone on the Bitcoin forum was, oh boy, let's use Bitcoin for this.
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[SPEAKER_01]: And there was right at the moment where WikiLeaks, just to insert a little bit of politics, culture, et cetera, they revealed a lot of diplomatic secrets of the United States.
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[SPEAKER_01]: And so the United States, as a government, like the biggest world governments were angry about this thing.
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[SPEAKER_01]: And so someone on the Bitcoin forum said, let's do Bitcoin Satoshi stepped in and said, no, don't bring it on.
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[SPEAKER_01]: Bitcoin is still young if you invite, you know, the intention of Russia, the United States in very high stakes type of scenarios, they'll just kill Bitcoin outright.
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[SPEAKER_01]: And so, Bitcoin's in beta, Bitcoin needs time to grow, Bitcoin needs time to get its feet.
7:54
[SPEAKER_01]: That was kind of Satoshi's reaction to the WikiLeas controversy.
7:59
[SPEAKER_00]: And I'd have to agree with them.
8:01
[SPEAKER_00]: I mean, he's probably right in the sense that this needed to mature and grow and to all the things that it kind of naturally did over the last 15 or so years.
8:11
[SPEAKER_00]: I mean, let's fast forward now.
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[SPEAKER_00]: I mean, what's it like been watching crypto, not only Bitcoin, but like the entire crypto industry kind of mature over the last 15 years.
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[SPEAKER_00]: I mean, there's been lots of upgrades, lots of additions, lots of industries and businesses and all these things.
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[SPEAKER_00]: I want to look at both sides, can you give me probably some of the things that you're the most proud of and excited of that have popped up and then maybe some of the things that you've disagreed with that have come out or come up through crypto.
8:39
[SPEAKER_01]: Sure, I like to make the analogy, I call it Darwin's trial by fire.
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[SPEAKER_01]: Crypto has gone through a number of cycles, and each one of these cycles you have what the economists call the irrational exuberance of, you know, we're going to, you know, do back in 2011, 2012, I think that's when,
9:04
[SPEAKER_01]: Lightcoin, a Bitcoin photocopy, one of the first photocopies a Bitcoin was launched.
9:12
[SPEAKER_01]: That kind of launched the first generation one of Launch Your Token.
9:17
[SPEAKER_01]: Looking back, it's hilariously expensive.
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[SPEAKER_01]: You had to spin up an entire mining network just to launch a token.
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[SPEAKER_01]: kind of the same thing you do on Ethereum today, you know, 60,000 Solana coins are launched every day.
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[SPEAKER_01]: You had to spin up an entire hash power mining network just to launch a token that all it did was photocopy Bitcoin.
9:41
[SPEAKER_01]: And so that was, uh, stepping back, that was the first ICO era was 20, you know, late 2010, 2011 when, uh, you go through a cycle of experimentation, people are like, how do I do this?
9:53
[SPEAKER_01]: What do I do this?
9:54
[SPEAKER_01]: Uh, scammers are like, how do I scam?
9:57
[SPEAKER_01]: Money makers are like, how do I make money?
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[SPEAKER_01]: And there's the hype cycle, the bubble, and then it comes down to earth.
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[SPEAKER_01]: The come down to earth part is where the survivors are the gyms.
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[SPEAKER_01]: The survivors are the ones that actually make sense.
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[SPEAKER_01]: So there were so many tokens that everyone's forgotten, like Catcoin from 2011, things of that nature.
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[SPEAKER_01]: But we have to go through these innovation cycles.
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[SPEAKER_01]: And I'm a developer.
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[SPEAKER_01]: I'm a builder.
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[SPEAKER_01]: I'm a dreamer, right?
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[SPEAKER_01]: And so we've got to go through a cycle of see what happens, experiment, innovate,
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[SPEAKER_01]: And here's venture capital power law, 95% of those will fail.
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[SPEAKER_01]: Maybe 98% of those will fail, but that's okay.
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[SPEAKER_01]: That's the process that one or two percent or the gyms of survivors.
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[SPEAKER_01]: So that's where Ethereum came out, kind of answering your questions.
10:51
[SPEAKER_01]: Like the first cycle, there's like chaos, BS, BS, and then what came out of it was lessons learned, oh, let's build Ethereum in Vitalik.
11:01
[SPEAKER_01]: and the other co-founders built Ethereum, and then you had the ICO cycle, less has learned what came out of that, defy.
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[SPEAKER_01]: is defy, you know, lending, it actually works.
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[SPEAKER_01]: So, dexes, uniswap, people are like bored with dexwaping.
11:17
[SPEAKER_01]: I did a dexwap, yeah, so what?
11:19
[SPEAKER_01]: That was huge for people in like 2014, 2015, 2016.
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[SPEAKER_01]: That was the new, new.
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[SPEAKER_01]: You didn't have to go to a regulated exchange.
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[SPEAKER_01]: You didn't have to KYC or go to some scammy Russian exchange.
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[SPEAKER_01]: You can just do it transparently on the blockchain.
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[SPEAKER_01]: And so the gyms of each cycle kind of feed the next cycle is kind of, you know, the decade plus look back.
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[SPEAKER_00]: I mean, it's true.
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[SPEAKER_00]: And we've said this a couple of times on the pod, but people have come in and they always say, oh, if I was around, if I would have known about Bitcoin in 2010, 2011, I would have just gone and bought some.
12:02
[SPEAKER_00]: And what they failed to understand is that it's not as easy
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[SPEAKER_00]: for the people who are around back then, you would remember, you don't just go on the coin base or open up your brokerage account and buy some, it was a lot harder to get your hands on than it is today, especially if you weren't tech savvy and if you weren't careful, because then you go to the wrong place and you try to get some and you get yourself in trouble, and there's just a lot that was going on back then, and it was definitely a different landscape.
12:32
[SPEAKER_01]: You know give you two quick anecdotes number one.
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[SPEAKER_01]: I know a gentleman.
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[SPEAKER_01]: I don't want to name his name, but well first name William William rented like 40,000 PCs and Amazon.com to mind Bitcoin on CPU which is like literally the most inefficient slow as way to mind Bitcoin, but he was still making
13:01
[SPEAKER_01]: Holy cow.
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[SPEAKER_01]: That's how it's like, you know, think about the time differential right is he was losing massive amounts of money with these for you know, it was like back then was like I don't know five dollars an hour times 40,000 is that just because he didn't know that GPUs were better at mining than CPUs because it was so that was before the GPU era that's that's how ancient it was.
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[SPEAKER_00]: That is wild, but I guess you're right when it appreciates that much.
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[SPEAKER_00]: It doesn't really matter.
13:31
[SPEAKER_00]: That's right.
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[SPEAKER_01]: And the other is, you know, I am, I am not, I tell people I'm not a Bitcoin billionaire.
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[SPEAKER_01]: You know, the other thing that people don't understand about the early days is, at least I, I had,
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[SPEAKER_01]: A little bit of personal, a son was a medical issue stuff, so I had to sell my Bitcoin and spend it and use it on real-life stuff.
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[SPEAKER_01]: And so, factoid, I've given away 15,000 Bitcoin and developer bounties back in 2010.
14:04
[SPEAKER_00]: It's a lot.
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[SPEAKER_00]: I'm not going to ask you how much it's worth today, but we'll put that thought aside.
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[SPEAKER_01]: My wife reminds me every year how much it's worth.
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[SPEAKER_00]: It's like the pizza story.
14:15
[SPEAKER_00]: That's right.
14:17
[SPEAKER_00]: Man.
14:17
[SPEAKER_00]: Well,
14:19
[SPEAKER_00]: It's hard.
14:20
[SPEAKER_00]: I mean, you can't it's it's easy in hindsight to look back at it and be like, oh, it was obvious when it's like okay holding for 15 years after I mean imagine if you had a stock right imagine you had a stock and you held it and it was up.
14:35
[SPEAKER_00]: 10 times a hundred times a thousand times at some point you're taking profits if you're up a thousand times and then you have Bitcoin which is up, you know, I don't know what since 2010 like hundreds of thousands probably times of what it was worth or whatever and
14:51
[SPEAKER_00]: Yeah, I mean, it's easier said than done.
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[SPEAKER_01]: So, you know, I guess that discipline the hold for 15 years and that thing, profit.
14:59
[SPEAKER_00]: Yeah, exactly.
15:00
[SPEAKER_00]: Think about all of you listeners who are given them a hard time, given us a hard time, just think about yourself.
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[SPEAKER_00]: How little the price might have moved when something two X's are three X's, or it falls by 15%.
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[SPEAKER_00]: And you're like, oh, maybe I should sell.
15:14
[SPEAKER_00]: Well, now you can understand what it's like, you know, multiplying that by 1,000 or 100,000.
15:19
[SPEAKER_00]: yeah you get you get it at a dollar it's at a hundred yeah right are you going to sell or you're going to hold is already a hundred that you know uh i i remembered this and i don't want to side notice too much but in the early days i was still in in in high school at the time and i did a report on bitcoin and uh you know long story short and presenting this report in high school and it was at like
15:42
[SPEAKER_00]: several dollars and it was this big deal.
15:46
[SPEAKER_00]: I was like, look at what it's done.
15:47
[SPEAKER_00]: It's worth multiple times more than what a US dollar is worth.
15:50
[SPEAKER_00]: And it was this amazing thing.
15:52
[SPEAKER_00]: And of course, that train never stopped.
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[SPEAKER_00]: But you know, the bring us back to the kind of the core of the conversation and where we're at in the current day, you know, 2026.
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[SPEAKER_00]: So there's billions of dollars in Bitcoin that's sitting idle, right?
16:06
[SPEAKER_00]: And that's kind of where he comes in.
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[SPEAKER_01]: Yeah, absolutely.
16:11
[SPEAKER_01]: Hemmy is a L2 that's connected to both of the hemispheres of cryptos we like to call it.
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[SPEAKER_01]: The King and Queen of Crypto Bitcoin and Ethereum.
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[SPEAKER_01]: It sits at the center of both of those.
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[SPEAKER_01]: It's a Bitcoin.
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[SPEAKER_01]: enhanced EVM and we're generating Bitcoin yield kind of coming back to my Bitcoin roots in a lot of ways with him.
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[SPEAKER_01]: He's very exciting.
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[SPEAKER_01]: We have a number of different initiatives going on on chain and across the chains and I'd love to talk about him.
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[SPEAKER_00]: Yeah, I mean, let's dive right on into it because for people who maybe are newer to crypting, you don't know, you can stake a lot of cryptos out there.
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[SPEAKER_00]: You can earn yields on them.
16:58
[SPEAKER_00]: You can generate yield, but Bitcoin is a little bit different.
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[SPEAKER_00]: Bitcoin is under a consensus mechanism where the thing that kind of runs the back end of Bitcoin called proof of work, whereas Ethereum and Solana are proof of stake.
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[SPEAKER_00]: So you can earn a yield on them by staking, but that's not something that you can do on Bitcoin.
17:15
[SPEAKER_00]: But what you're saying here is,
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[SPEAKER_00]: you want to make it or you've already made it so that you can earn a yellow and bit coin.
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[SPEAKER_00]: How does that work?
17:23
[SPEAKER_01]: That's exactly right.
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[SPEAKER_01]: And you've summarized it very well as many of the other protocols they came a little bit later.
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[SPEAKER_01]: They have a little bit of a different design proof of stake versus proof of work.
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[SPEAKER_01]: And so Bitcoin natively doesn't have a just hold it, help secure the
17:44
[SPEAKER_01]: Now, at this point, if there's any big coin miners in your audience, they're probably saying, hey, wait, I'm getting yield, and that's one way to look at it, and the one way we're looking at it, we have something called minor phi that I would love to talk about as well.
17:59
[SPEAKER_01]: But ultimately, the market is turning back to Bitcoin, the market is coming back to Bitcoin, the root of the crypto tree, and without a built-in native yield source, you need to design it in.
18:15
[SPEAKER_01]: And there are a number of different options for people who are into markets and trading.
18:21
[SPEAKER_01]: That sort of thing.
18:22
[SPEAKER_01]: Lending markets is one area that people source yield on.
18:27
[SPEAKER_01]: trading fees is another popular one that can bolt on some other Bitcoin related ventures.
18:37
[SPEAKER_01]: They actually pipe the mining revenue that I just mentioned back into holders and that's a form of yield.
18:44
[SPEAKER_01]: So there are a number of different, if you're, I call myself a Twitter network plumber.
18:50
[SPEAKER_01]: If you're a network plumber, you know where the yield is, but it's not packaged for users and a nice, easy, just put your Bitcoin here, earn yield and be safe kind of way.
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[SPEAKER_01]: And that was the user experience that we really wanted to design and build.
19:07
[SPEAKER_00]: Yeah, I mean, it's been cool to see Bitcoin's ecosystem kind of evolve over the last several years.
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[SPEAKER_00]: You've seen people try, and people have, and I mean, try, you've seen the ecosystem around Bitcoin get built up so that people can build things on it or create products out of it.
19:22
[SPEAKER_00]: When it comes to to Hemmy,
19:25
[SPEAKER_00]: Do you view this as a place where people can come and earn a yield on just like their spot bitcoins, like upholding the actual bitcoins, coins themselves?
19:35
[SPEAKER_00]: Or have you ever thought about trying to expand this to the ETF offerings as well?
19:39
[SPEAKER_00]: Because obviously those have kind of ballooned in their size and now they have these just billions and billions of dollars inside of them.
19:47
[SPEAKER_01]: uh... definitely the latter we're uh... stepping from uh... here's if you're uh... a defy uh... expert here's the plumbing that you can use for yield that's uh... that's kind of level zero that's not very approachable it's uh... that's why i call it plumbing but if you're an expert you know how to use it the next level up is okay we've orchestrated a lot of that plumbing made it easier now there's a safe path for your bitcoin if you're a crypto native
20:17
[SPEAKER_01]: you can come here and earn yield.
20:20
[SPEAKER_01]: Now the next level and getting to your question is Wall Street is starting to hold billions in Bitcoin.
20:27
[SPEAKER_01]: These digital asset treasury companies, these DATs, ETFs, they are the prime candidate for the next evolution of himmy.
20:38
[SPEAKER_01]: And the reason is is all of that Bitcoin is idle.
20:42
[SPEAKER_01]: It's both the era of the Bitcoin maximalist, the holding in a cold wallet, we argue as over, and the Bitcoin pragmatist era of you want to hold your, you want to huddle your Bitcoin and earn yield on it.
20:58
[SPEAKER_01]: And also the institutional era of these institutions are regulated by Wall Street.
21:05
[SPEAKER_01]: They got to have things like qualified custodians and audits and due diligence and all of the checks and balances that you would want to have for someone managing multiple billions of dollars in Bitcoin.
21:19
[SPEAKER_01]: It's a sign that we've matured that these folks are playing in the crypto industry.
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[SPEAKER_01]: And so it's,
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[SPEAKER_01]: fantastic that these folks even exist and much less they're diving in with both feet and Bitcoin deep waters.
21:35
[SPEAKER_01]: So that's where Hemi really shines is those institutions that are looking for
21:42
[SPEAKER_01]: Not just kind of yellow, gamble, your Bitcoin type of yield, but a very well-apportioned, well-engineered, audited, battle-tested code flows that qualified custodians and institutions can actually trust.
21:59
[SPEAKER_01]: So that's where him is looking for the DATs.
22:03
[SPEAKER_00]: And this is, you're able to do this in self-custody.
22:07
[SPEAKER_00]: I believe it's alright.
22:08
[SPEAKER_00]: that's right that's exactly right which i think a lot of people are happy about because i don't know there's been so many burns in the past we put your custody with someone else and then god forbid something outside of your control happens and with self custody for the most part it's about a safe as you make it if you store your password and you posted online not going to be very safe and walk it in the safe on a piece of paper a whole lot more safe
22:34
[SPEAKER_01]: Exactly.
22:36
[SPEAKER_01]: And these institutions, they have some pretty insane levels of security.
22:42
[SPEAKER_01]: Just to give your listeners a quick glimpse, I won't name the company, but they're one of the largest Bitcoin holders.
22:52
[SPEAKER_01]: They have red, green, and blue teams geographically separated.
23:04
[SPEAKER_01]: secure facility a skiff S-C-I-F that you go in and there's a not internet connected computer with keys and you do these key ceremonies and stuff like that and there are armed guards outside that room so that is that is institutional grade Bitcoin security right there that is
23:27
[SPEAKER_00]: It's scary and crazy, but also a little bit cool.
23:30
[SPEAKER_00]: There's like the part of me that's like, man, that is pretty cool.
23:34
[SPEAKER_00]: When it comes, what are some of Hemie's other notable products?
23:38
[SPEAKER_00]: You know, there is yield, but there's a lot more going on that you all have been building.
23:42
[SPEAKER_01]: So from a, I'll start with a quick technology standpoint, him is an L2, a layer 2, it executes all the familiar Ethereum, EVM, smart contracts.
23:57
[SPEAKER_01]: But since our team is very deep tech, we did something that almost no one else has done.
24:02
[SPEAKER_01]: we extended that EVM in a compatible way to talk to Bitcoin L1.
24:10
[SPEAKER_01]: And so, everyone else on the planet, they're writing smart contracts, they're writing smart contracts for Ethereum.
24:16
[SPEAKER_01]: Smart contracts on Hemi, they can talk to two blockchains.
24:21
[SPEAKER_01]: Number one, Hemi.
24:23
[SPEAKER_01]: and then number two Bitcoin.
24:25
[SPEAKER_01]: And that's new and different for developers.
24:28
[SPEAKER_01]: Developers can actually wait for Bitcoin payments on this Ethereum EVM chain.
24:34
[SPEAKER_01]: So you got kind of, you know, for non-developers, I'd say Bitcoin programming is now on steroids.
24:42
[SPEAKER_01]: You can do a whole lot more
24:50
[SPEAKER_01]: We have Ethereum and Bitcoin tunnels, that's what everyone else calls bridges.
24:56
[SPEAKER_01]: Those are very secure.
24:58
[SPEAKER_01]: They are bringing zero knowledge proofs as well as an upgrade to that in 2026.
25:06
[SPEAKER_01]: And then we have what we call an HVM, the EVM, that's the Ethereum virtual machine.
25:14
[SPEAKER_01]: It has a node.
25:20
[SPEAKER_01]: and embedded it inside the Ethereum node.
25:25
[SPEAKER_01]: And so you have again real live Bitcoin L1 capability that you can program your smart contracts with.
25:33
[SPEAKER_01]: So that's, that's what I mean by Bitcoin programming on steroids.
25:37
[SPEAKER_01]: And that enables all sorts of kind of cross chain applications like
25:42
[SPEAKER_01]: a Thorachane cross chain decks, far greater security of tunnels than most of the other cross chains, and ultimately high speed, ZKL3 transactions for everyone.
25:57
[SPEAKER_00]: Well, that kind of begs the question.
25:59
[SPEAKER_00]: What do you think about the awkward market?
26:02
[SPEAKER_00]: Because we've had people who have been around in Bitcoin for a long time.
26:06
[SPEAKER_00]: And some of the time they come on, and they say, I think Bitcoin's the only way and everything else is a scam.
26:11
[SPEAKER_00]: And they're big, one maximum.
26:13
[SPEAKER_00]: So then we've other people come on.
26:14
[SPEAKER_00]: who say hey Bitcoin is great and they still love Bitcoin but they say it's been cool to see altcoins be able to come up and grow and flourish and take the original technology that was behind Bitcoin and kind of add to it and modify it into what altcoins are now today.
26:30
[SPEAKER_00]: I mean it sounds like you're pretty open to altcoins.
26:33
[SPEAKER_01]: Absolutely, and there are a couple of ways to think about this, you know, rewinding back to 2010, you're just, you're in a Bitcoin-only landscape, where are you going to get the venture capital to start that business?
26:49
[SPEAKER_01]: You don't have a magic bean to give away, you know, an altcoin to give away for incentives or anything like that, so it makes building businesses a lot harder.
27:01
[SPEAKER_01]: So first, first pass, it's just a lot harder to build a Bitcoin native business.
27:07
[SPEAKER_01]: And God bless us, I tried a lot of other people tried in 2010, a few succeeded, many failed.
27:15
[SPEAKER_01]: But that is tough without altcoins.
27:18
[SPEAKER_01]: The second thing is just building TVL, liquidity, interest, how do you kind of cut through all the noise?
27:27
[SPEAKER_01]: And if you don't have a way to bring people in,
27:31
[SPEAKER_01]: then that's one of the tools in the toolbox you're kind of handicapped in yourself.
27:36
[SPEAKER_01]: And so, but the third one is third point is Darwin's trial by fire that I mentioned earlier is we got to innovate, we got to try, we got to assume that again, venture capitalists when they make an investment they assume 90% of their investments will fail, will return nothing.
27:56
[SPEAKER_01]: Another 5% will make back their money and the last 5% is going to, you know, that's where all the money is made.
28:05
[SPEAKER_01]: That's where you get the thousand X returns and stuff like that.
28:09
[SPEAKER_01]: That's let's call power law distribution.
28:11
[SPEAKER_01]: And you see the same thing with all coins is that, you know, just looking at a macro economist amateur supply and demand, we have so many tokens.
28:23
[SPEAKER_01]: So 99.9% of them will be worthless supply and demand.
28:28
[SPEAKER_01]: But the other 0.1%
28:31
[SPEAKER_01]: Those are going to be with us.
28:32
[SPEAKER_01]: Those are going to be gems.
28:34
[SPEAKER_01]: Those are going to be useful.
28:35
[SPEAKER_01]: Those are going to sustain us into the next cycle.
28:39
[SPEAKER_00]: I think that is so incredibly true.
28:43
[SPEAKER_00]: And it's a hard pill for people to swallow.
28:47
[SPEAKER_00]: And listen, if you're a listener, it should be obvious.
28:50
[SPEAKER_00]: We love crypto, where huge fans of crypto.
28:52
[SPEAKER_00]: But most all coins aren't going to make it.
28:55
[SPEAKER_00]: There's going to be a lot to do, but what people failed to understand is that there's still going to be a lot that don't.
29:00
[SPEAKER_00]: And back in, I would say the 2017, 2018 run was profound for me because everything went up.
29:08
[SPEAKER_00]: There was hundreds, if not maybe thousands of altcoins, and pretty much everything went up.
29:13
[SPEAKER_00]: Well, fast forward to the current day.
29:15
[SPEAKER_00]: I was just looking at the number.
29:16
[SPEAKER_00]: There's 29.9 million crypto's publicly listed on coin market cap.
29:23
[SPEAKER_00]: You can promise you there's more than that out there that aren't listed.
29:26
[SPEAKER_00]: There are recorded.
29:27
[SPEAKER_00]: There's almost 30 million of them.
29:30
[SPEAKER_00]: So you make a good point.
29:32
[SPEAKER_00]: How many of those 30 mil, almost 30 million can actually blow up and be something big and long lasting overall over an extended period of time, most of them can't, but it's not about most of them, it's about the few you don't need everything to succeed, but you
29:47
[SPEAKER_00]: what you need are things to actually build something that matters and I think that's what we're still seeing.
29:51
[SPEAKER_00]: We're seeing a lot of cryptos, a lot of obviously Bitcoin, but a lot of altcoins as well and projects just using blockchain tech that are building something that is shaping the future of finance.
30:02
[SPEAKER_00]: And I think that's why we see these big asset managers like Blackrock, like JP Morgan, like city bank, like Bank of America, talking about things like stablecoins,
30:13
[SPEAKER_00]: and all these different areas that they're interested in using and they're talking about this like it's the future.
30:19
[SPEAKER_00]: So when you were saying that, I was like, I wonder how many cryptos are in existence and I had the check and go on my little rant.
30:25
[SPEAKER_01]: But, uh, no, build the matters.
30:28
[SPEAKER_01]: That's kind of an unintended encapsulation of why I get up in the morning.
30:34
[SPEAKER_01]: is that, you know, there are all these experiments, there's all this, you know, kind of noise out in the world, but if you, and this goes back to one of your earliest questions, why get up in the morning, why do this is crypto brings freedom to people, crypto brings, you know, options to people, well to people,
30:56
[SPEAKER_01]: and it's an alternative to many of the existing systems that do have existing problems.
31:04
[SPEAKER_01]: And so there's a lot of kind of cultural hedging that goes on by holding crypto.
31:13
[SPEAKER_01]: And I think that if we look back,
31:17
[SPEAKER_01]: Over 15 years, there's kind of three killer apps that have emerged.
31:22
[SPEAKER_01]: Bitcoin, I'm going to say is a killer app in and of itself.
31:26
[SPEAKER_01]: People on, you know, outside of crypto Twitter, forget about crypto industry.
31:31
[SPEAKER_01]: People in the mainstream have heard of Bitcoin.
31:34
[SPEAKER_01]: They talk about Bitcoin on CNBC.
31:36
[SPEAKER_01]: It's broken through.
31:37
[SPEAKER_01]: That's kind of my litmus test.
31:40
[SPEAKER_01]: Bitcoin number one killer app.
31:42
[SPEAKER_01]: What's the number two killer app stablecoins?
31:45
[SPEAKER_01]: Stablecoins have broken through.
31:47
[SPEAKER_01]: They talk about stablecoins on CNBC and mainstream and you got stablecoins in your Robinhood app and things like that.
31:55
[SPEAKER_01]: So it's becoming the new ACH, the new payment rail, and so stablecoin is the number two killer app.
32:01
[SPEAKER_01]: Number three, polymarket.
32:05
[SPEAKER_01]: prediction markets have broken through from crypto to the mainstream and so crypto is changing you know just the look back on my career crypto is changing culture is changing the world it's you know you kind of get lost in the 60,000 tokens a day on Solana noise that the look back of crypto is it is getting into every corner of financial life
32:33
[SPEAKER_01]: People are bringing more and more things on chain.
32:37
[SPEAKER_01]: I remember 10 years ago was super silly when Walmart wanted to bring lettuce on the blockchain and I'm like What does that even mean lettuce on the blockchain?
32:48
[SPEAKER_01]: And you had so many silly pitches in that that kind of vein
32:54
[SPEAKER_01]: But the real real is crypto is broken through to the mainstream.
32:59
[SPEAKER_00]: No, it has.
33:00
[SPEAKER_00]: And I'm so glad.
33:01
[SPEAKER_00]: That was a lost memory that I had.
33:03
[SPEAKER_00]: I remember that headline, and I remember talking about it.
33:07
[SPEAKER_00]: And back in the day, I was doing some sort of report on it before I was even here with the team.
33:14
[SPEAKER_00]: So funny.
33:14
[SPEAKER_00]: I looked back on that.
33:16
[SPEAKER_00]: And at times, I've thought, I'm like, what for happened with that?
33:19
[SPEAKER_00]: Like, where did we really deal with it and what happened?
33:23
[SPEAKER_00]: But now, I mean, you know, now fast forward to the current day and it's it's come so far and it's it's great to see I guess I kind of begs a question they're like, what do you think is next for Bitcoin we've gone through this period where you're right it's being talked about on TV it's being talked about but in on CNBC it's being talked about
33:45
[SPEAKER_00]: at the top of the United States government's level.
33:48
[SPEAKER_00]: I mean, the president talks about it, the secretary, treasury, talks about it.
33:53
[SPEAKER_00]: Everyone's talking, we have these ETFs.
33:55
[SPEAKER_00]: We have asset managers and banks who want to get involved.
33:58
[SPEAKER_00]: Where do we go from here?
34:00
[SPEAKER_00]: For people who are asking, what are the next catalyst to maybe push us forward?
34:06
[SPEAKER_00]: Like, is there one?
34:08
[SPEAKER_01]: Well, you know, a very selfishly my answer is we're already covered at Bitcoin yield on him.
34:15
[SPEAKER_01]: That's my very selfish answer.
34:18
[SPEAKER_01]: You know, more broadly, I think people are coming back to Bitcoin.
34:22
[SPEAKER_01]: I think, but Bitcoin is maybe I'll be a little bit controversial here and piss off half your audience.
34:30
[SPEAKER_01]: It's a little bit of a steam engine.
34:32
[SPEAKER_01]: It's a little bit of, you know, it's kind of stuck in federated multi-sig type security land.
34:41
[SPEAKER_01]: It's a little bit harder to custody, but all of those problems are getting solved by, you know, firms like him, me, other firms.
34:50
[SPEAKER_01]: And so now that that's getting solved, again, people are coming back to Bitcoin and they're looking for financial products related to Bitcoin.
34:59
[SPEAKER_01]: institutional grade financial products.
35:02
[SPEAKER_01]: So it's not going to be I think the the sexy era but it's going to be the boring due diligence institutional era where people are far more comfortable holding Bitcoin.
35:15
[SPEAKER_01]: There's kind of the the fourth turning Google that out in the world and the folks are kind of coming back to gold kind
35:27
[SPEAKER_01]: a lot of the chaos out in the world.
35:30
[SPEAKER_01]: It's kind of a hyperinflation hedge for currencies undergoing hyperinflation.
35:36
[SPEAKER_01]: So there's a lot of kind of forces pulling people back to the O.G.
35:41
[SPEAKER_01]: crypto Bitcoin itself.
35:43
[SPEAKER_00]: And when it comes to yield, I want to go back to that because we get to talk to a lot of the different ETF providers and different asset managers and stuff over here and that's something that they really want for all of their products right the more yield that they can get the better because you have to imagine that now with them having hundreds of millions or some of them billions and billions of dollars in these ETFs sitting there.
36:12
[SPEAKER_00]: They can earn a yield on it, passively.
36:15
[SPEAKER_00]: They can sit on it, charge a little bit of a fee, and even if they're taking 1% of the staking that's earned, you know, say, you know, you make 100 bucks, they take $1 of that, 100 bucks that you made on staking, even if they're taking 1% on billions of dollars every single year for them, that's three money.
36:34
[SPEAKER_00]: They're sitting on money.
36:35
[SPEAKER_00]: They need very little to do beyond getting
36:38
[SPEAKER_00]: the technology there and then getting it regulatory approval, and then that's it.
36:42
[SPEAKER_00]: In perpetuity, they are just making past of money.
36:45
[SPEAKER_00]: And we've seen the desire for that and Ethereum, we've seen the desire that in Solana, those are now growing and you know, you're able to, I think Bitwise has one now that's a stake in ETF for Solana.
36:57
[SPEAKER_00]: But the big coin ETFs are the ones that have the most assets under management.
37:01
[SPEAKER_00]: So you think that there's the most incentive to get something like that.
37:04
[SPEAKER_00]: And again, that's immediately where my brain goes is that there's all these companies out there.
37:09
[SPEAKER_00]: They like making money.
37:11
[SPEAKER_00]: It's their whole purpose in the first place.
37:13
[SPEAKER_00]: And so I think Hemmy's really cool and kind of fit.
37:16
[SPEAKER_01]: Absolutely.
37:17
[SPEAKER_01]: It's there's a hunger for that.
37:19
[SPEAKER_01]: Hemmy is perfectly positioned for that.
37:22
[SPEAKER_01]: It's mainly a matter of all these big dogs move slow.
37:27
[SPEAKER_01]: And so they got a pass or due diligence checks, et cetera, et cetera.
37:32
[SPEAKER_01]: And so you, you kind of see things happen in waves.
37:35
[SPEAKER_01]: You saw like five Bitcoin ETFs happen within a week once the regulatory approval happened.
37:42
[SPEAKER_01]: And.
37:43
[SPEAKER_01]: Once Bitcoin's staking finds its format, you're going to find all these DATs and ETFs within a week, two weeks.
37:51
[SPEAKER_01]: They're all staking.
37:52
[SPEAKER_01]: So they're all hyper competitive.
37:54
[SPEAKER_01]: They just got to check those regulator check boxes.
37:57
[SPEAKER_00]: That is true and luckily it's a little bit easier for them now to do that.
38:02
[SPEAKER_00]: But for people who want to get involved with Hemi, you know, let's go back to this, you know, if there's institutions watching, if there are individuals watching,
38:10
[SPEAKER_00]: It's heavy for everyone, so if you're an individual person with a wallet, you can do it or is it only for the institutional side.
38:17
[SPEAKER_01]: Absolutely, it's Himmie's definitely for everyone.
38:21
[SPEAKER_01]: We have an institutional focused BD team.
38:26
[SPEAKER_01]: We also have an open source community segment.
38:29
[SPEAKER_01]: And so whatever level you're entering in the Himmie community or absolutely welcome, Himmie.xyz on the web is not only a portal.
38:40
[SPEAKER_01]: Also has plenty of documentation for developers.
38:44
[SPEAKER_01]: looking for technical information, links to our GitHub.
38:48
[SPEAKER_01]: It's all open source.
38:49
[SPEAKER_01]: That's how we roll.
38:51
[SPEAKER_01]: And fundamentally, these are open permissionless networks.
38:54
[SPEAKER_01]: You never do closed source on an open permissionless network.
38:58
[SPEAKER_01]: If you want people to trust you.
39:00
[SPEAKER_00]: Absolutely.
39:00
[SPEAKER_00]: And where can people find you if they're trying to come in, they want to go to your website, maybe your ex account or something else?
39:06
[SPEAKER_00]: Where can people follow both you and him?
39:09
[SPEAKER_01]: Well, you can follow me at J. Garzick, J. G. A. R. Z. I. K. On Twitter.
39:15
[SPEAKER_01]: I am a frequent poster of non-crypto stuff.
39:20
[SPEAKER_01]: So you're, you've got to deal with that.
39:22
[SPEAKER_01]: Hemi underscore XYZ is the official Hemi.
39:25
[SPEAKER_01]: exit count.
39:26
[SPEAKER_01]: Follow us on there.
39:27
[SPEAKER_01]: Go to homie.xyz.
39:29
[SPEAKER_01]: Addison your metamask wallet and visit our app portal.
39:35
[SPEAKER_01]: Get some great bitcoin yield and explore.
39:40
[SPEAKER_00]: What's your favorite non-crypto things to talk about?
39:43
[SPEAKER_01]: uh... non-crypto is uh... probably space space i uh... i just love uh... you know science fiction becoming uh... science fact we're talking about uh... space base data centers cities on the moon i read about all that when i was a kid going to cape can never watch and space shuttle lunches now it's coming true we're really gonna have cities on the moon we're really gonna have people on the moon by the end of uh...
40:13
[SPEAKER_01]: for this decade, excuse me.
40:15
[SPEAKER_00]: That it is.
40:16
[SPEAKER_00]: I find space fascinating as well, and so I think we can both agree that we are going to do cool things in space and bitcoins going to space as well, because we're sending it to the moon.
40:25
[SPEAKER_00]: Absolutely.
40:27
[SPEAKER_00]: But it all jokes aside, everything, you know, Jeff, thank you for coming on.
40:31
[SPEAKER_00]: We appreciate your time, and you be in with us, and we're definitely going to have to get an update with you as all this stuff, mature as in the industry grows.
40:40
[SPEAKER_00]: Appreciate your time with us.
40:42
[SPEAKER_01]: Thanks for having me, thanks for listening, always a good time.
40:45
[SPEAKER_00]: 100% And that's gonna bring us to a wrap in today's episode everyone.
40:50
[SPEAKER_00]: Thank you all for listening.
40:51
[SPEAKER_00]: This has truly been a one of a kind episode, and we'll see all of you at the same time, same place next week.
40:57
[SPEAKER_00]: Take care.