Episode 25: Cory Levy and Balaji on Where Talent Should Go - The Network State Podcast

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Cory, welcome to Network State Podcast. Thank you for having me. I don't really like being on podcasts, but here we are. And so I thought I'd maybe interview you and then maybe it could be, you know, back, back and forth, but let's go. But, but maybe just to, to set the, the, the, the virtual stage, maybe you can just summarize in like 2 minutes what we just talked about on our tour. And then from there, I'll dive into some of the questions that I was thinking about on our in our walk. Totally. Yeah. So briefly, as we know, it was easier to start Netflix and reform Blockbusters, easier to start Bitcoin than reform the Fed, and I believe it's easier to start a new city than reform San Francisco, and may even be easier to start new countries than to reform America. And at least with 99.99% of people working on the reform path, we should have some small fraction of people working on the path for building alternatives, which tech is good

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at, right? Peaceful reform by just building an alternative. And then, you know, the customers of the old come to the new, the parallel institutions. And in a sense, what we've done here at network school is just like you take a Google Doc and you print it out, or you take Metaphorically an Amazon shopping cart, you print it out to your doorstep, right? Like it comes to your door. Or you take a, you know, Uber and the app and you print out an Uber to your door. In the same way we're taking a cloud community and we're printing out in the physical world and we're showing we can do that here at network school. And if we prove that here, we can scale that out to other network school nodes around the world. And eventually we can do that where we have many students and many people come to network schools start their own startup societies and pop ups, become the new startups. And so that's it. And so how's it going?

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I think it's going great. I don't know. Give me your impressions. You were here. I think it's pretty cool. Yeah. Yeah, so I just got here, you know, less than an hour ago and my, you know, Instagram versus reality is I thought, you know, it was going to be a little quiet and not that many people. but in fact, when I arrived, it seemed to be like a bustling sort of place. And so I was surprised to in a very good way to see that. And so I guess how do you think about success in KPIs for this place? Remind me, how long is it? It's how long has it been been a place? Just a year, just a year or so. How long has it been? I think this has been a place for about a year. We open network school September 24th, 2024, right? So it's just a little bit over a year, but a year and a yeah. And I think we've succeeded in bringing people from more than

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100 countries here. And basically, I think it feels like SF. I think it's like the good parts of SF, right? You know, like, it's like the tech. It's kind of like walking into a tech cafe. Which surprisingly, they're limited in SF where you can walk into a tech cafe past certain hour. Yes, that's right. So we keep ours open late and we are essentially something where there's a recognition that, you know, there's many cities around the world that have unicorn and so on. Now, tech is decentralized out of SF. I'm sure you see that in your founders. The Internet is obviously outside of SF, most billionaires are not American and so on, as we were just talking about. So can we just print out the values of the good parts of SF and California tech, can we print them out somewhere else? And that's what we're doing. Here, understood on our walk, we were you.

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You mentioned about some of the our friends being in denial in the United States. Yes, talk to me about that. And what else do you think people are in denial of? Sure. So the issue is basically that. Think about, for example, during the Biden administration, too many people. It was obvious that Biden was senile, yet he managed to make it through the 2020 election and four years of a presidency and even the Democrat primary and then even six months of like the general, you know, election period until at the very final moment, like 3 months before the election, it was finally marked to mark and acknowledged. OK, yes, he was seen it all along. And it's this this thing where you can see on Polymarket, like Biden's chance of being the nominee or so. And it just then collapsed like this, right?

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So and Polymarket was maybe the best tracker we have objective sentiment because you weren't necessarily doing a real time poll on that. and so that's the mark to market, right? The West right now is in this weird stage where whether it's SVB or it's FTX or it's Biden, they are denying that rather than a gradual decline like this where it's sort of acknowledged all the way down that they are quote, taking the L, right? They deny and then it's just digital death, correct? It's like a square wave drop off, correct? All those things you mentioned happened. What, what do you think it is today that they're in denial that it hasn't happened yet? But. Well, several things. One is 1 that's happening right now is the death of the dollar, right? Gold is appreciated by it's

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doubled against the dollar in the last two years. And Bitcoin has quadrupled against the dollar in the last two years, which means really what's happened is the dollar has dropped 50% against gold and 75% against digital gold. And so that's like we're in the middle of this. But people, you know, there'll be a point. I don't know exactly the point. Maybe it's $10,000, you know, an ounce for gold, or maybe it's, I don't know, $200,000 Bitcoin. I don't know the exact number. There'll be some number where people realize I'm not getting wealthier. It's the dollar that's getting weaker. There's a loss of confidence. You know, Powell was talking about stimulating into an already, you know, kind of high inflation economy because they might need that for the 2026 midterms or something like that. Dalio has written about this. Elon went to the government, our best guy who could literally

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land a rocket with, you know, chopsticks and do electric cars and brain machine implants and genuinely have more. I mean, Tesla humanoid robots, Tesla diner things, the kinds of things you can manage in parallel. As you and I know, we know a lot of people in this SPACe. It's remarkable how many things Even Elon said it can't be done, right? So our best guy went in and said the US government can't be reformed after going all in an Elon way. There's been essentially, though it's not being called this, a surrender to China. That just happened where essentially Hicks, Abe, and Trump said everlasting peace with China after this meeting. And the new National Defense Strategy, when it's published, it is reported to essentially be withdrawing American troops from

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East Asia back to the Western Hemisphere. And then of course, there's the political, ongoing political fighting within the US. And So what they're in denial about is simultaneous economic, military and political decline. And it's not just confined to the US, it's happening in all the G7. If you look at yields, for example, they're spiking in the US, UK, Germany, Italy, France, Japan, Canada. And there's headlines like the UK may need an IMF bailout, France may need an IMF bailout. But isn't the IMF composed of these countries, right. So you're seeing essentially the simultaneous collapse of the major countries that fashion, whether you call it the, the international community, the rules based order, the Western world, including Japan, the American Empire, whatever you

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want to call it, that's all going down at the same time. And the issue is that people have seen lots of movies on, let's say, invasions by aliens or killer robots. And it's actually easier for them to envision a post apocalyptic world like this than a world where actually there's simultaneous military, economic, political collapse in all Western countries at once. Similar to what happened with Biden, but even more severe, right? That is what I think we're in the middle of. But they'll be maybe some moment where it's recognized and it's very dramatic. The way that social media works is like this. And snap, I can say more of a let me pause there. Cool. And I guess my, my follow up to that would be like in a bad way, but So what, So what, you know, for people that are in the

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Western culture and that are in America right now, you know, do you think it'll be a sudden flee or do you think it'll be a gradual sort of recognition of this? And I guess more specifically, like, so what for the person that's living? Extremely good question. And you know, Dalio, actually I think if you read Dalio's book, he thinks the US or the empire, American Empire. By the way, I say American Empire in a in a most people say it in a negative way, like it's imperialism or a Republic non empire. But the left and the right will say those things. But there was a good version of American Empire, which was certainly a better empire than the Soviets were the Nazis. And the central left and central right version had diplomacy that was the best in the world and signed all of these trade deals to everybody and the military that was strongest in the world and generally maintain the peace

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in the high seas and blue jeans rock'n'roll. There are lots and lots of good things about American Empire, right. So I'm actually somebody who right and praise of it, you know, it's, it is at a minimum mixed. So that's so you can't say it's completely negative. There's a lot of positives about it. There's, you know, the Internet itself came out of that, the human genome project, blah, blah, we could go on and on, right? So I want to just calibrate and make sure that's being understood. I'm, I'm definitely not a hater. I am, I am, however, a realist, right? And sometimes when you look at a company and you see its balance sheet, you realize this one isn't going to make it. And you have to give the hard news to the people in that company that their salary is there. And so, but you know what life is going to be different. They're going to have to find a new job and so on and so forth. However, we, we don't have is and, and by the way, you, you,

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you know this overseas as well. Once in a while, you'll flip the channel and you'll see some country where you know, it's a failed state. Everybody's yelling and shooting each other and you'll say, well, that sucks. And you'll flip the channel because what are you going to do? Are you going to go and parachute over there and say that? Right. And now I increasingly have that feeling when I look at America. Everybody's yelling and shooting each other. And so and so it's getting more and more intense and agitated. But I don't think, I think it's only a shadow of what it's going to be. And the reason is dollar inflation is global taxation. But I mean, that is, it's not just Americans who are taxed by inflation, it's the entire world who is part of the US financial system directly or indirectly. For example, all these countries that buy Treasuries and they save in Treasuries if they hold

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U.S. stocks. Even until the mid twenty 10s, Alibaband other Chinese companies were going public in the US, right? If they have Delaware companies, if and so and so, there's so many ways in which they're dependent upon the US financial system, right? Which is why Treasury is able to sanction all these countries and you know, and so on. But now we're seeing simultaneous run, and I'll get to your point in a SECond. The salaries run from U.S. Treasuries into Chinese treasuries whose yields are at all time lows, by the way, and China's bigger than the G7 combined. So if their yields are low and all the G7's yields are high, that means neutral global investors who are not mandated to buy treasuries because some people have that in their charters, they have to buy treasuries, right? So those who are not forced to buy treasuries, if you were forced by the way you lost your shirt or the last few years, you're complete debt. It's like when the worst times

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ever bonds, maybe the worst time ever. There's some charts that show that. I think Charlie Bialiu post things like this coulDeFind the exact chart, but it's definitely a bad time, if not the worst time. So they're going out of U.S. Treasuries, and they're going into Chinese treasuries, they're going into gold, and they're going into digital gold. So this whole thing, this financial system is going to zero. And you're seeing that with, for example, seizures of companies. You're seeing that with the government taking equity stakes in companies. You're seeing that with the tariffs. You're seeing that with the wealth taxes. On the left. You're seeing that would be remittance taxes on the right. You're seeing that would be property taxes where inflation is boosting property values. The pie is shrinking. And even as the numbers are going up, the actual real value is going down, which is why the political fighting is getting more intense.

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When that pilot collapses, then the last piece of paper holding blue American, red America together was green, like a tattered piece of paper, the dollar, because blue Americans don't certainly don't vote for red Americans. They don't socialize with them anymore. They're in blue sky versus X. And they don't actually even marry them. Only 4% of Democrats are married to Republicans, right? So that's not actually a country, It's an economic zone to reverse it. You know, you've seen the tweet saying it's not an economic zone, it's a country, right? It's actually an economic zone, not a country, because these are two tribes like Sunni and Shiite, right? And Catholic during the 30 years War. They don't get along. So green is the last thing holding them together. When that tears, the whole thing is going to come apart because the economic union comes apart. And the extent to which American living standards are subsidized by dollar inflation every time

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the trillion dollars is to give it just a very rough calculation. Let's say there's 3 billion people out of the 8 billion that are in the American dollar economic union globally, right? If that contracts back to just the 300 million of the US, right? For example, what are the tariffs doing? They're telling other countries, don't send your shoes from Vietnam to America for print dollars, right? Don't send your valuable goods to America for print dollars because ultimately that's all America is sending back. That's what the trade deficit means, right? So you're saying dollars are not valuable outside America anymore. Fine. This something which means the scale of American empire is going to contract just like the Soviet empire contracted, right? It went from this thing which had military bases in Cameroon Bay and in Vietnam and Angola and had bases in Cuba to all the way back or like informal bases in Cuba to all the way

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back to just Russia. And it lost Ukraine and it lost, you know, the Warsaw Pact countries and lost Central Asian countries. That's what's happening. And what does that mean? Well, first is it means living standards plummet to and how much they plummet. If you go from 3 billion people to 300 million people, your printing is spread over 90% fewer people. So your inflation is way up, right #1 #2 is they're starting to be retaliation against the US by the rest of the world. the US passport has just dropped out of the top ten. It's collapsed in terms of the number of countries you can go through because places like Brazil, for example, have reciprocity rules. If America makes it hard to get in, they make it hard for Americans to get it right.

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So US identity is actually plummeting along with US currency. US currency is being devalued. US identity is being devalued. So it becomes hard for Americans to get out. Taxes go up. Violence increases the shootings of CEO's, shootings of Charlie Kirk and so on. And, and basically what I think what the issue is, most Americans don't, I mean, they know 1945 and they know 1865, they know 1776, but they don't really understand 1917 or 1991 or 1949 or 1947. That's say they don't understand the history of, let's say Russia or the history of India or the history of China. And those countries have histories where America's in a current state that's more like a like a just state SPACe theory. Share More. OK, in control theory, in

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math, right, Like a, for example, a car, you don't summarize its current state by just its position or its velocity or its acceleration. You have all three of those in a vector, right? And each of these are themselves vectors. And then you have all these other variables like how much fuel does have in the tank, right? What is the state of each of the tires? So it's like this big vector that has all of these components on it, right? And then given all of that, there's a system in the car that says, given all this stuff, OK, we'll spend this much fuel to accelerate. And you know, you can have a very sophisticated kind of mechanism here where perhaps, OK, we're running lower on fuel. So we're going to reduce the velocity and, and so on and so forth. So to optimize fuel mileage, for example, right.

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What it means is that the state of many complex systems is not univariate. You can't just point to an interest rate, for example, but it's multivariate, it's interest rate, it's unemployment rate, but it's also how many people in the country know math and you know, how many of them are married to each other versus like childless and so all these other variables, right? So if you think of a country as having a vector of variables, I think the vector of variables that the US is most similar to now is not 1945 certainly, which is very highly homogeneous aligned integrated country with the rest of the world collapsed. It's 3 examples, the Soviet Union in 1991 when it was on the verge of collapse because it had both ethnic nationalism in the union and basically the economic system was at the end of its legs. India during partition. OK, so India had essentially 2

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what were today Bangladesh and Pakistan flanking India and essentially the borders were announced and people just ran across the borders, right? And the Chinese civil war between communists and nationalists. And so you're actually seeing people pattern recognize at least the last one of these now where they're like, wow, OK, after this moment ANI election, it's communist versus nationalist in America. OK, so that's one piece. The SECond piece is Indian partition. The geography is very similar to the East Coast or the you know, West Coast is blue, Northeast is blue, heartland is red. That's actually very similar to how Indian partition looked. If you go and look at at the map, right? And the migration back and forth is similar to Hindu Muslim migration with partition where Reds are going to red States and Blues are going to blue states. AnDeFinally the end of the

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Soviet Union. People understand the economic issues, they don't really understand the ethnic issues. In 1989, a census came out that show that the Russian ethnic group was down to 51% of the Soviet Union. Many Americans just think of the Soviet Union as Russian, but actually had like, you know, Turks and Uzbeks and Koreans. It was this huge Eurasian empire that spanned every kind of thing that had Eastern Europeans. And all these different ethnic groups started to feel oppressed by the Russians and the Russians in turn felt oppressed by them. The Estonians felt oppressed by the Russians. The Russians moved in and made their country Russia fun. And then vice versa, the Russians felt they were carrying the weight of the union. And so the whole thing broke about an ethnic terms, not just economic terms. Both those kinds of factors are there in the US today. Why the like wokes and MAGAs both feel that each other is oppressing them ethnically #1 right and #2 Keynesianism is a

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lot like communism. Should I explain that? I know, I know. I'm just like, rallying. Go, go. No, no, no, I'll, I'll, I'll what one thing I want to kind of shift to is, is kind of talent pipelines, yes. And so there's maybe a clear distinction whether you're in America or out of America of where to go. If you are, you know, super young and ambitious or just, you know, period ambitious, yes, let's talk about America. You know, the ones that, you know, they end up on the coast, most likely, you know, New York, San Francisco or Boston. Where do you think that will be in the future? How do you kind of think about talent pipelines here where we are today? And then kind of more broadly, if you're like 16 to 22. Great question. What should you do now, given everything that you just said? So at a minimum you should visit Dubai. So visit Warsaw and Poland,

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Dubai, Riyadh, Bangalore, Singapore. If you're here at Singapore, come and visit NS Ho Chi Minh City in Vietnam and then go to Shenzhen in China. But then also go to like the number 52 city in China. Now you'll finally be calibrated on where the world is, right? And what you'll see is that Poland, which is where Warsaw, you know, so Warsaw and Dubai and Riyadh and even Bangalore actually, and certainly Shenzhen and Ho Chi Minh City and Singapore and some, you know #50 city in China you've never heard of, have higher living standards than much of the US. And so they're not Third world countries.

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They're not backwaters, which they were in 1991, right? Over the last 30 years, history's run in reverse. And in many ways the former first world is becoming quote, third world and vice versa. The reason I'd say that's the first thing to do is you have to calibrate on where the world is and media reports of this kind of thing. There aren't Hollywood movies on this right? the New York Times, Anglo media is more and more and more insular focus on the, the, the Civil War within or cold Civil war or quasi cold civil war, whatever you want to call it. And they're not showing images really of what's happening outside because it's depressing to people who are still caught in that Anglo kind of world. And our friends will. They'll they'll tell me the we're building, we're building. And I love them. I love them so much, right?

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But to me, it's as if imagine, you know, they're on the Titanic, OK. And they're like solving the Reman hypothesis on the Titanic, right? They're mashing the keys. They're they're having breakthroughs in math, computer, whatever. All this happening, it's real. It's genuinely real. But the vector on which they're accelerating is not the vector on which they're decelerating. And so the physical platform that people are taking for granted, the reason I brought those historical examples is nothing that most Americans have experienced, certainly most 10th generation Americans, right? The longer you've been in America, the less you've experienced genuine catastrophe. And whereas if you're an immigrant, you have like, that's other part of it, like if you're from Cuba, if you're from China, if you're from India, which it was when socialist, if you're obviously from Russiand you know, certainly the Jewish

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community came from, you know, obviously Germany. They've got maybe the most memory that things can go wrong in America right now. The people who've been there for a very long time think it will always get better. You know, it's AUSA, don't count us out. They'll basically quote homilies like this, right? And that's similar to people thinking, oh, real estate always goes up, you know, And so unless you look at the history of other countries, you don't have a sense of how far it can go down. Like actually, I'll put it a different way. In tech, you know that just the fact that something has never happened before doesn't mean it can't happen. Example air flight, right? Like for thousands of years, humanity could not fly. And you're crazy to think if you could fly. And then one day we could, right? Like AI is like that, right? You know, SPACe travel is like that and so on and so forth,

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right? These things literally were not possible and then it happened. So that's in a sense a positive surprise. But now you have to visualize a negative surprise like this, like like what COVID was, like what the collapse of the Roman Empire was. That's that's what I think. And so let's. See, for talent, right? Yeah. Talent calibrates by going outside the US, number one. Then they're going to see it's actually possible to build in the physical world. The reason we've been confined to building in the digital world is because of regulations and rules in the Western world. Outside of that, those don't exist. And at the 1 silver lining to the American empire receding is that regulatory harmonization also recedes. Do you know what that is? Share it for those who don't. Sure. OK, So FDASEC, all these three letter agencies, some anonymous

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bureaucrat in Silver Spring, MD is setting essentially the health rules for the whole world because like until recently the Czechoslovakian FDA or the Chinese FDA, even the Chinese FDA would respect the American FDA's decision. In fact, even the fact that there was a cognate of them that those countries were structured in such a way that they had AFDA equivalent, SC equivalent, they basically were copying the American political system and how it was set up. So the reason that both the government and pharma companies like this pharma could get its approvals in the US and they could ship around the world. It was a homogeneous market in a sense, right? This called harmonization. All those countries essentially sing together in harmony. The big problem with this some anonymous bureaucrat who

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you've never heard of who was not elected and can't be fired. So neither electoral nor market theories of accountability actually, you know, deal with this. They're saying the rules for the whole road and if they make a mistake then whole swath of technology are are knocked out. And this has happened with biotech, which is area very familiar with and there's various kinds of holes on the side of the system. For example, right to try laws or LDT and CLIA for clinical laboratory tests or compounding pharmacies for mixing, mixing drugs or off little prescription or medical tourism. Those are five different workarounds to get outside of the FDA system. And we saw with, with the, with the first with Uber and Airbnb, how much regulation was holding back innovation in the physical world. And then with crypto AT100X scale, how much the SEC and, and FTC and so on, CFTC were holding

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back innovation in the digital world. I think now we're going to see how much innovation in the physical world is being held back by regulatory harmonization, right? So the major opportunity for talent is be mobile, be global, and realize that there's actually advantages of being outside 20th century regulatory spheres. And that doesn't mean by the no regulation, it just means better rules. So what I mean, I guess the B mobile part, you know kind of go visit the cities you go and see like how do you think about accelerating if you're, you know someone that's 20 years old today and you go visit insert one of those cities you've spent a lot of time in San Francisco, Do you think one will find that communities there yet? So San Francisco is interesting because it is possible San Francisco could go.

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It depends if like someone like either Zuck or somebody like Zuck who has yet to show themselves. You know, like we're in a time where someone can come out of nowhere politically like Bukele or Madani or something like that. You need somebody who has the drive of a Zucker and Elon. And I don't know who that person you'd have to either. Zuck is the only person in the Bay Area who kind of has that level of drive. Go ahead. Go for it. Say influence, drive, etcetera. Influence, drive, capital, and so on to like what Elon is doing at Starbase, right? What actually Republicans are doing in Florida is possible that someone could do that in the Bay Area. But it's also, I don't think most people in the Bay understand the severity of their situation.

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Should I explain why, please? They're building AI and other things, but especially AI in the bluest city, in the bluest state in the union and saying very publicly they're going to make billions by putting lots of Blues out of work, right? Because where they're putting out of work, they're putting where they say they're putting them out of work. I don't think they actually are, by the way. I think AI, as I've said, does it middle to middle, not end to end, but they're saying they are. And that's being believed by other people. So lawyers, doctors, bureaucrats, journalists, artists like film makers, all these people who are already being hit by inflation are seeing these people making billions by putting them out of work in a state where the tech guys are massively outnumbered. So when they're setting self-driving cars on fire in San Francisco, shooting CEOs calling for wealth taxes, they proposed, by the way, 5% of all tax in

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California. Did you see that? I haven't yet. OK, so it's only targeted 200 billionaires and it's only a one time tax, but it's already retroactive. So if it's passed in 2026, if the quote billionaire was in the state in 2025, they are taxed. Here's how it works. It's like it's taxed on the value of your stock in 2025. So that means is they've got some probability that this bill passes in 2026, right? And it's a referendum or something. If it passes. And the worst thing would be if they they had let's say a billion in stock and it declined in 2026. That means they need to liquidate at least 5% of their stock this year in order to cover the tax bill next year or they have to budget for some giant lawsuit to fight this if it does go through because the

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retroactive tax or what have you. The point is tech is in an extremely precarious situation in San Francisco and they've been lulled into a false sense of SECurity by this. It's kind of like a stock that's dropped 90% and it's come up 30%. We don't have the metrics to look at how badly San Francisco fell and rose Like, yes, Lurie is better than before, right? But think about you went from de Blasio to Eric Adams, who was better and then you went to Mamdani, right? So it can get worse. And so I think San Francisco is in it's Eric Adams era, so to speak. And it could get much worse if economic conditions deteriorate and especially if tech guys are doing OK or even great as those conditions through because the Internet is fine, right?

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Like the future in many ways is not blue America versus red America, but the Internet versus China. And so if it's because that's where capital and wealth and so on are going, and so talent should be mobile tech talent should not centralized in the Bay Area. It should understand how well the rest of the world is doing in the same way they're they're buying Bitcoin, right? They're at least hedged against the dollar, right? You should at least hedge against serious political instability in the USA. So basically SECond passport is much more important than your first home for many people. By the way, you don't even may not even need a passport, you can get visas, right? Why you can get like for example, if you're of Jewish descent, you can make aliyah to Israel, they'll give you a passport.

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If you're of Indian descent, you can get an OCI card overseas as of India if you're of Irish descent, If you're of European descent, there's there's procedures. If you're like Italian American, you can get something right. Many of the old world countries have some provision for like citizenship by blood, not by law right? You can also there's lots of digital nomad visas around the world. It's like 3 dozen countries with digital nomad visas. China just opened up AK visa. Super interesting. So I, I, you know, I, I meet with a bunch of people that are just starting their careers that are, you know, all over the world and like the, the thing that they're looking for, the thing that I can kind of sense is they want to be in San Francisco, like trying to get a plane to get out to San Francisco. So you think, you know, passport should be, you know, SECond passport should be kind of number one thing.

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What other things you think people should strive for when they're not in San Francisco but trying to further their careers? Yes, so I think so. I recognize that it's consensus for many people SF and but in many ways the most important things happen when they're in informed numerical anti consensus view. It's like contrarian but right example. The TL fellowship right was the consensus was you need to go to college. Thiel had seen ZOC and he'd seen Marc Andreessen. He'd seen others who had either dropped out of college, dropped out of grad school and done very well and realized that was at least a pattern for some of the very smartest and he started the Thiel fellowship to prove the point is extremely non consensus at the time. People forget how non consensus it was. That's what I'm kind of excited to be here since I think this non consensus.

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Yes, that's right. Exactly. So, you know, but it produced Vitalik and Bruce. Dylan Fielder produced a bunch of really, really, really amazing people. And he was contrarian, but right on an important trend and he actually did the experiment right. And so my view is I like a lot of people who are going to SFA, lot of our friends are. I just think they think about technical risk but not political risk. And is that it just purely kind of like? That's that. I mean, that's it. But that's like it's a huge hit for sure. Exactly. It's it encapsulates so much in it because political risk is regulatory risk. Like actually, you only give it a tech analogy, right? If you think of the state as a platform, right? There's often debates about what should the public SECtor do? What should the private SECtor do? Let's have a different analogy,

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which is, you know, like Apple's iOS or Google's Android, right? These are developer platforms and people can build apps on the platforms and they can they can do well, right? But the platform maker also builds their own first party apps. And sometimes if they see 50 people who are building something, you know, let's say some location services, say, you know what, let's offer a platform level service for this. We take an abstraction that all of you guys can use and that's actually in a sense, the public SECtor as a platform, like a really smart, you know, rational public SECtor creates these kinds of services, right? And so the platform in which you're building is ridiculously important. If you make the wrong platform, chase, if someone built on BlackBerry as opposed to building on iOS or Android, they would just lose, no matter how

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good a coder they were. They were just trying to fight gravity. If you, if you start with a Windows desktop app at the time that everybody's going to web apps, you just, you know, lose. And So what are examples of bad platforms building on Delaware, right? So many people have had problems, you know this already, right? Holding U.S. Dollars. That's gone down a lot relative to holding Bitcoin. What's what's your if you don't, if you feel comfortable sharing like what percentage of your net worth is in Bitcoin or digital assets versus the US dollar versus gold versus. Well, I would say this, I hold, I hold, you know, in a sense, I love Americans. I love my American friends and, and all my people there and so on. But minimum necessary America in the sense of basically U.S. dollars. For example, during the whole SUV kind of crisis, there's a meme that said if you have like a, if you have more than 250K in

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AUS bank account, then it's not protected by FDIC insurance and some and so forth. Now what they did is actually they replace that with Fed DIC insurance in the sense of the Fed essentially said we will just print the difference or what have you, which basically means. So it's a little bit technical. Banks are supposed to have a reserve ratio that say you, you put in 100 million there. They can only lend out a certain amount and they're supposed to keep some back. Most people don't know that in 2020, the Fed set the reserve ratio to 0. It's no longer even fractional reserve banking. It's fictional reserve banking. OK, so banks don't actually have deposits on hand to, to support you pulling cash out. So when there was like a, an attempt to pull out those deposits there, they weren't there.

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And also these banks actually have massively negative equity. They owe far more than they have because they bought these bonds that went underwater. So the entire thing is the zombie financial system. And what that means is like you don't only invest in U.S. dollars, what you can afford to lose. So that's. Is that your answer though? That's my answer, yeah. You tend to vote with your feet. You're here. You're not in America. and. To be clear, I hope I'm wrong, right? But basically I just feel the platform underneath which we are at has, has systemic risk. And now if that said, if you holDefiat currency by possible nation, what's the best fiat currency to hold? I'd say don't hold any of the G7 fiat currencies because it's not just the dollar, it's a Canadian

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dollar. It's, you know, like the, the British pound and you know, all, all the, the euro and so on and so forth. All of these are kind of in the same like class class of things that are basically in the American empire broadly, the three things that have historically been supposedly outside that. So Switzerland is supposed to be independent. It's no longer independent because they did the Russia sanctions. Obama basically essentially ended Swiss bank accounts with, you know, all this stuff. And then also the Credit Suisse debacle that happened recently where bondholders got wiped out. So Switzerland ain't Switzerland anymore. What is Switzerland? Bitcoin, right? Crypto. That's genuinely neutral rule of law, right? Truly neutral. It's not based on the human opinion, right? OK. But then in the fiat world, I would say the UAE and Singapore now the, they're on the AD is pegged to the dollar and Sud

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is soft pegged to the dollar. But they run on their own ledgers and they've got very sophisticateDeFinancial managers running both countries. And so if you had to hold and they're, they're also very large currencies by float. So lots of capital flows through. So whatever your deposit won't even be seen in the noise of that. So if you must holDefiat AED and SGD in my view. Now the one counter argument, everything I'm saying to take the other side of it is stablecoins, the massive expansion of USD stablecoins. It may have a weird scenario where you know how all local papers collapsed against the when all the papers went online, the newspapers went online, all local papers suddenly lost their geographical monopoly. They're printing the same news

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as each other, they no longer have the trucks and so on to give them a geographical monopoly. So all of them lost to NYTWSJ Washington Post, which then in turn lost to Internet first social media competitors after a huge fight, right? So imagine all global fiat currencies lose to USD, maybe the Chinese yuan, maybe a few other kinds of stablecoins like this. And those in turn get devalued against BTC and other currencies, right? So lots of fiat currencies are, and we're kind of already there. Like in Bolivia, for example, prices are quoted in USDT, right? So the worlDeFirst dollarizes and then Bitcoinizes or cryptoizes. That'll be a huge crazy kind of thing, even crazier than the media wars of the of the 20 tens. The last question that was on my

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mind was about trust and credibility. Yes, thing you're doing here. What do you think the, you know, what, what can you sort of take from the elite institutions, the Stanfords, the San Francisco's, the, you know, United States, the US dollar, you know, most people do think that is sort of trust and right, high trust, high credibility. What, what's your kind of take and what are you learning from that to bring to here? Yes. So I think the Internet is to Americas America was to the UK, right. So it's a version 3 point O. So clearly like the Internet is as American as America was British. So obviously America was a debt to Britain. It speaks English. It was, it was populated by British columnists and on and on. All kinds of names there are British and you've got a special relationship there. And so the Internet is as American as America's British because America eventually became something larger than

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Britain. It went from common law to constitution. The next step constitution to smart contract right from 30 million ish 30 to 50 million Brits, 300 million Americans, billions of Internet users. So how do we rebuild trust? The next rules based order is the code based order, right? So it is smart contracts. It is Bitcoin, which you can trust more than dollar smart contracts. You trust more than Delaware crypto identity. You can't be denaturalized. You can't have your crypt, your ENS, your SNS, your Ethereumian system login that can't be yanked from you in the same way that perhaps your American identity can be. And so we essentially restore trust by reducing the need for trust with cryptographic trust. And so from that we can build an entire parallel essentially legal system, which we've already done. It's at multi trillion person

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scale. It already manages, it's like the 3rd or 4th largest exchange in the world. Nyze and NASDAQ are about to get flipped by crypto. It already passed, I think Shanghai, right? So I mean, you know, it's a big system, hundreds of millions of people are in it and it's growing, right? So something that's at hundreds of millions of people and it's growing. That eventually is the successor to the rules based order. It's a code based order. So we take lots of concepts from that. And with the crypto we can you know when, so when the system crashes, what do you do? You reboot from cloud backup, right? So that's what we'll do. We'll reboot from cloud backup. Got it, got it. And then sorry, last, last thing. Let's say everything in your wildest dreams becomes true with this place. And 1st kudos for you doing this. And they're not not that many people that create TL fellowships are kind of bold, contrarian. That's like what you're doing.

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What will be the next thing to do? I might do this for the rest of my life in some ways because it's a big thing. And you know, Zuck once said like if he sold Facebook, he would just go back to doing Facebook and so and so forth. So this something in a sense I've been working on for 10 plus years and I work on it every day and I work on every hour of every day because I think we need an alternative. In the same with the United States was an alternative to the wars of Europe, right. And I, I think the Internet and Internet societies are going to be an alternative to what has come. All right. Cool. Thanks.