>> From Cambridge, Massachusetts, it's theCUBE covering MIT Chief Data Officer and Information Quality Symposium 2019 brought to you by SiliconANGLE Media. (upbeat techno music) >> Hi everybody, welcome back to Cambridge, Massachusetts. You're watching theCUBE, the leader in tech coverage. We go out to the events. We extract the signal from the noise, and we're here at the MIT CDOIQ Conference, Chief Data Officer Information Quality Conference. It is the 13th year here at the Tang building. We've outgrown this building and have to move next year. It's fire marshal full. Gokula Mishra is here. He is the Senior Director of Global Data and Analytics and Supply Chain-- >> Formerly. Former, former Senior Director. >> Former! I'm sorry. It's former Senior Director of Global Data Analytics and Supply Chain at McDonald's. Oh, I didn't know that. I apologize my friend. Well, welcome back to theCUBE. We met when you were at Oracle doing data. So you've left that, you're on to your next big thing. >> Yes, thinking through it. >> Fantastic, now let's start with your career. You've had, so you just recently left McDonald's. I met you when you were at Oracle, so you cut over to the dark side for a while, and then before that, I mean, you've been a practitioner all your life, so take us through sort of your background. >> Yeah, I mean my beginning was really with a company called Tata Burroughs. Those days we did not have a lot of work getting done in India. We used to send people to U.S. so I was one of the pioneers of the whole industry, coming here and working on very interesting projects. But I was lucky to be working on mostly data analytics related work, joined a great company called CS Associates. I did my Master's at Northwestern. In fact, my thesis was intelligent databases. So, building AI into the databases and from there on I have been with Booz Allen, Oracle, HP, TransUnion, I also run my own company, and Sierra Atlantic, which is part of Hitachi, and McDonald's. >> Awesome, so let's talk about use of data. It's evolved dramatically as we know. One of the themes in this conference over the years has been sort of, I said yesterday, the Chief Data Officer role emerged from the ashes of sort of governance, kind of back office information quality compliance, and then ascended with the tailwind of the Big Data meme, and it's kind of come full circle. People are realizing actually to get value out of data, you have to have information quality. So those two worlds have collided together, and you've also seen the ascendancy of the Chief Digital Officer who has really taken a front and center role in some of the more strategic and revenue generating initiatives, and in some ways the Chief Data Officer has been a supporting role to that, providing the quality, providing the compliance, the governance, and the data modeling and analytics, and a component of it. First of all, is that a fair assessment? How do you see the way in which the use of data has evolved over the last 10 years? >> So to me, primarily, the use of data was, in my mind, mostly around financial reporting. So, anything that companies needed to run their company, any metrics they needed, any data they needed. So, if you look at all the reporting that used to happen it's primarily around metrics that are financials, whether it's around finances around operations, finances around marketing effort, finances around reporting if it's a public company reporting to the market. That's where the focus was, and so therefore a lot of the data that was not needed for financial reporting was what we call nowadays dark data. This is data we collect but don't do anything with it. Then, as the capability of the computing, and the storage, and new technologies, and new techniques evolve, and are able to handle more variety and more volume of data, then people quickly realize how much potential they have in the other data outside of the financial reporting data that they can utilize too. So, some of the pioneers leverage that and actually improved a lot in their efficiency of operations, came out with innovation. You know, GE comes to mind as one of the companies that actually leverage data early on, and number of other companies. Obviously, you look at today data has been, it's defining some of the multi-billion dollar company and all they have is data. >> Well, Facebook, Google, Amazon, Microsoft. >> Exactly. >> Apple, I mean Apple obviously makes stuff, but those other companies, they're data companies. I mean largely, and those five companies have the highest market value on the U.S. stock exchange. They've surpassed all the other big leaders, even Berkshire Hathaway. >> So now, what is happening is because the market changes, the forces that are changing the behavior of our consumers and customers, which I talked about which is everyone now is digitally engaging with each other. What that does is all the experiences now are being captured digitally, all the services are being captured digitally, all the products are creating a lot of digital exhaust of data and so now companies have to pay attention to engage with their customers and partners digitally. Therefore, they have to make sure that they're leveraging data and analytics in doing so. The other thing that has changed is the time to decision to the time to act on the data inside that you get is shrinking, and shrinking, and shrinking, so a lot more decision-making is now going real time. Therefore, you have a situation now, you have the capability, you have the technology, you have the data now, you have to make sure that you convert that in what I call programmatic kind of data decision-making. Obviously, there are people involved in more strategic decision-making. So, that's more manual, but at the operational level, it's going more programmatic decision-making. >> Okay, I want to talk, By the way, I've seen a stat, I don't know if you can confirm this, that 80% of the data that's out there today is dark data or it's data that's behind a firewall or not searchable, not open to Google's crawlers. So, there's a lot of value there-- >> So, I would say that percent is declining over time as companies have realized the value of data. So, more and more companies are removing the silos, bringing those dark data out. I think the key to that is companies being able to value their data, and as soon as they are able to value their data, they are able to leverage a lot of the data. I still believe there's a large percent still not used or accessed in companies. >> Well, and of course you talked a lot about data monetization. Doug Laney, who's an expert in that topic, we had Doug on a couple years ago when he, just after, he wrote Infonomics. He was on yesterday. He's got a very detailed prescription as to, he makes strong cases as to why data should be valued like an asset. I don't think anybody really disagrees with that, but then he gave kind of a how-to-do-it, which will, somewhat, make your eyes bleed, but it was really well thought out, as you know. But you talked a lot about data monetization, you talked about a number of ways in which data can contribute to monetization. Revenue, cost reduction, efficiency, risk, and innovation. Revenue and cost is obvious. I mean, that's where the starting point is. Efficiency is interesting. I look at efficiency as kind of a doing more with less but it's sort of a cost reduction, but explain why it's not in the cost bucket, it's different. >> So, it is first starts with doing what we do today cheaper, better, faster, and doing more comes after that because if you don't understand, and data is the way to understand how your current processes work, you will not take the first step. So, to take the first step is to understand how can I do this process faster, and then you focus on cheaper, and then you focus on better. Of course, faster is because of some of the market forces and customer behavior that's driving you to do that process faster. >> Okay, and then the other one was risk reduction. I think that makes a lot of sense here. Actually, let me go back. So, one of the key pieces of it, of efficiency is time to value. So, if you can compress the time, or accelerate the time and you get the value that means more cash in house faster, whether it's cost reduction or-- >> And the other aspect you look at is, can you automate more of the processes, and in that way it can be faster. >> And that hits the income statement as well because you're reducing headcount cost of your, maybe not reducing headcount cost, but you're getting more out of different, out ahead you're reallocating them to more strategic initiatives. Everybody says that but the reality is you hire less people because you just automated. And then, risk reduction, so the degree to which you can lower your expected loss. That's just instead thinking in insurance terms, that's tangible value so certainly to large corporations, but even midsize and small corporations. Innovation, I thought was a good one, but maybe you could use an example of, give us an example of how in your career you've seen data contribute to innovation. >> So, I'll give an example of oil and gas industry. If you look at speed of innovation in the oil and gas industry, they were all paper-based. I don't know how much you know about drilling. A lot of the assets that goes into figuring out where to drill, how to drill, and actually drilling and then taking the oil or gas out, and of course selling it to make money. All of those processes were paper based. So, if you can imagine trying to optimize a paper-based innovation, it's very hard. Not only that, it's very, very by itself because it's on paper, it's in someone's drawer or file. So, it's siloed by design and so one thing that the industry has gone through, they recognize that they have to optimize the processes to be better, to innovate, to find, for example, shale gas was a result output of digitizing the processes because otherwise you can't drill faster, cheaper, better to leverage the shale gas drilling that they did. So, the industry went through actually digitizing a lot of the paper assets. So, they went from not having data to knowingly creating the data that they can use to optimize the process and then in the process they're innovating new ways to drill the oil well cheaper, better, faster. >> In the early days of oil exploration in the U.S. go back to the Osage Indian tribe in northern Oklahoma, and they brilliantly, when they got shuttled around, they pushed him out of Kansas and they negotiated with the U.S. government that they maintain the mineral rights and so they became very, very wealthy. In fact, at one point they were the wealthiest per capita individuals in the entire world, and they used to hold auctions for various drilling rights. So, it was all gut feel, all the oil barons would train in, and they would have an auction, and it was, again, it was gut feel as to which areas were the best, and then of course they evolved, you remember it used to be you drill a little hole, no oil, drill a hole, no oil, drill a hole. >> You know how much that cost? >> Yeah, the expense is enormous right? >> It can vary from 10 to 20 million dollars. >> Just a giant expense. So, now today fast-forward to this century, and you're seeing much more sophisticated-- >> Yeah, I can give you another example in pharmaceutical. They develop new drugs, it's a long process. So, one of the initial process is to figure out what molecules this would be exploring in the next step, and you could have thousand different combination of molecules that could treat a particular condition, and now they with digitization and data analytics, they're able to do this in a virtual world, kind of creating a virtual lab where they can test out thousands of molecules. And then, once they can bring it down to a fewer, then the physical aspect of that starts. Think about innovation really shrinking their processes. >> All right, well I want to say this about clouds. You made the statement in your keynote that how many people out there think cloud is cheaper, or maybe you even said cheap, but cheaper I inferred cheaper than an on-prem, and so it was a loaded question so nobody put their hand up they're afraid, but I put my hand up because we don't have any IT. We used to have IT. It was a nightmare. So, for us it's better but in your experience, I think I'm inferring correctly that you had meant cheaper than on-prem, and certainly we talked to many practitioners who have large systems that when they lift and shift to the cloud, they don't change their operating model, they don't really change anything, they get a bill at the end of the month, and they go "What did this really do for us?" And I think that's what you mean-- >> So what I mean, let me make it clear, is that there are certain use cases that cloud is and, as you saw, that people did raise their hand saying "Yeah, I have use cases where cloud is cheaper." I think you need to look at the whole thing. Cost is one aspect. The flexibility and agility of being able to do things is another aspect. For example, if you have a situation where your stakeholder want to do something for three weeks, and they need five times the computing power, and the data that they are buying from outside to do that experiment. Now, imagine doing that in a physical war. It's going to take a long time just to procure and get the physical boxes, and then you'll be able to do it. In cloud, you can enable that, you can get GPUs depending on what problem we are trying to solve. That's another benefit. You can get the fit for purpose computing environment to that and so there are a lot of flexibility, agility all of that. It's a new way of managing it so people need to pay attention to the cost because it will add to the cost. The other thing I will point out is that if you go to the public cloud, because they make it cheaper, because they have hundreds and thousands of this canned CPU. This much computing power, this much memory, this much disk, this much connectivity, and they build thousands of them, and that's why it's cheaper. Well, if your need is something that's very unique and they don't have it, that's when it becomes a problem. Either you need more of those and the cost will be higher. So, now we are getting to the IOT war. The volume of data is growing so much, and the type of processing that you need to do is becoming more real-time, and you can't just move all this bulk of data, and then bring it back, and move the data back and forth. You need a special type of computing, which is at the, what Amazon calls it, adds computing. And the industry is kind of trying to design it. So, that is an example of hybrid computing evolving out of a cloud or out of the necessity that you need special purpose computing environment to deal with new situations, and all of it can't be in the cloud. >> I mean, I would argue, well I guess Microsoft with Azure Stack was kind of the first, although not really. Now, they're there but I would say Oracle, your former company, was the first one to say "Okay, we're going to put the exact same infrastructure on prem as we have in the public cloud." Oracle, I would say, was the first to truly do that-- >> They were doing hybrid computing. >> You now see Amazon with outposts has done the same, Google kind of has similar approach as Azure, and so it's clear that hybrid is here to stay, at least for some period of time. I think the cloud guys probably believe that ultimately it's all going to go to the cloud. We'll see it's going to be a long, long time before that happens. Okay! I'll give you last thoughts on this conference. You've been here before? Or is this your first one? >> This is my first one. >> Okay, so your takeaways, your thoughts, things you might-- >> I am very impressed. I'm a practitioner and finding so many practitioners coming from so many different backgrounds and industries. It's very, very enlightening to listen to their journey, their story, their learnings in terms of what works and what doesn't work. It is really invaluable. >> Yeah, I tell you this, it's always a highlight of our season and Gokula, thank you very much for coming on theCUBE. It was great to see you. >> Thank you. >> You're welcome. All right, keep it right there everybody. We'll be back with our next guest, Dave Vellante. Paul Gillin is in the house. You're watching theCUBE from MIT. Be right back! (upbeat techno music)

(Upbeat music) >> From the Hard Rock hotel in Las Vegas, its theCUBE! Covering the Hosho Con 2018, brought to you by Hosho. >> Okay, welcome back every one, this is theCUBE's exclusive coverage here live in Las Vegas for Hosho Con, the first inaugural event where security and block chain conferences is happening, it's the first of its kind where practitioners and experts get together to talk about the future, and solve some of the problems in massive growth coming they got a lot of them. Its good new and bad news but I guess the most important thing is security again, the first time ever security conference has been dedicated to all the top shelf conversations that need to be had and the news here are covering. Our next guest Greg Pinn who's the head of strategy and products for iComply Investor Services. Great to have you thanks for joining us. >> Very nice to be here >> So, we were just talking before we came on camera about you know all the kind of new things that are emerging with compliance and all these kind of in between your toes details and nuances and trip wires that have been solved in the traditional commercial world, that have gotten quite boring if you will, boring's good, boring means it works. It's a system. But the new model with Block Chain and Token Economics is, whole new models. >> Yeah I think what's so exciting about this is that in the Fiat world, from the traditional financial market, everyone is so entrenched in what they've been doing for 20, 30, 40 years. And the costs are enormous. And Block Chain, Crypto coming in now is like we don't have to do it that way. We have to do compliance. Compliance matters, it's important and it's your legal obligation. But you don't have to do it in the same sort of very expensive, very human way that people have been doing it in the past. >> And Cloud Computing, DevOps model of software proved that automations a wonderful thing >> Right >> So now you have automation and you have potentially AI opportunities to automate things. >> And what we've seen is huge increases in technology, in around machine learning and clustering of data, to eliminate a lot of the human process of doing AML, KYC verification, and that's driving down costs significantly. We can take advantage of that in the Crypto Space because we don't have thousands of people and millions of millions of dollars of infrastructure that we've built up, we're starting fresh, we can learn from the past and throw away all the stuff that doesn't work, or isn't needed anymore. >> Alright let's talk about the emerging state of regulation in the Block Chain community and industry. Where are we? What's the current state of the union? If you had to describe the progress bar you know with zero meaning negative to ten being it's working, where are we? What is the state of >> I think if you'd asked me a year ago I think negative would've been the answer. A year ago there was still a big fight in Crypto about do we even want to be part of Compliance, we don't want to have any involvement in that. Because it was still that sort of, Crypto goes beyond global borders, it goes beyond any of that. What's happened now is people have realized, it doesn't matter if you're dealing in Crypto Currency or traditional currency, or donkeys or mules or computers or whatever, if you're trading goods for value, that falls under Regulatory Landscape and that's what we're hearing from the SCC, from FinCEN, from all the regulators. It's not the form it's the function. So if you've got a security token, that's a security, whether you want it to be or not. You can call it whatever you want, but you're still going to be regulated just like a security. >> And I think most entrepreneurs welcome clarity. People want clarity, they don't want to have to be zigging when they should be zagging. And this is where we see domicile problem. Today it's Malta, tomorrow it's Bermuda. Where is it? I mean no one knows it's a moving train, the big countries have to get this right. >> A hundred percent. And beyond that what we're seeing, what's very, very frustrating for a market as global as this is it's not just country-level jurisdiction, the US you've got State-level jurisdiction as well. Makes it very, very hard when you're running a global business if you're an exchange, if you're any sort of global, with a global client reach. Managing that regulation is very, very difficult. >> You know I interviewed Grant Fondo who's with Goodwin Law Firm, Goodwin Proctor they call it Goodwin now, he's a regulatory guy, and they've been very on the right side of this whole SCC thing in the US. But it points to the issue at hand which is there's a set of people in the communities, that are there to be service providers. Law Firms, Tax, Accounting, Compliance. Then you got technology regulation. Not just financial you have GDPR, it's a nightmare! So okay, do we even need GDPR with Block Chain? So again you have this framework of this growth of internet society, now overlaid to a technical shift. That's going to impact not only technology standards and regulations but the business side of it where you have these needed service providers. Which is automated? Which isn't automated? What's your take on all of this? >> I agree with you a hundred percent, and I think what's helpful is to take a step back and realize while compliance is expensive and a pain and a distraction for a lot of businesses. The end of the day it saves people's lives. And this is what, just like if someone was shooting a gun as you were running down the street, in your house, you're going to call the police, that is what financial institutions are doing to save these industries and individuals that are impacted by this. A lot of it from a Crypto Currency perspective, we have a responsibility because so much of what the average person perception is, is Ross Ulbricht and Silk Road. And we have to dig our way out of that sort of mentality of Crypto being used for negative things. And so that makes it even more important that we are ultra, ultra compliant and what's great about this is there's a lot great opportunities for new vendors to come into the space and harness what existed whether that's harnessing data, different data channels, different IDDent verification channels and creating integrated solutions that enable businesses to just pull this in as a service. It shouldn't be your business, if you're in exchange, compliance is something you have to do. It should not become your business. >> Yeah I totally agree, and it becomes table stakes not a differentiator. >> Exactly >> That's the big thing I learned this week it's people saying security's a differentiator, compliance is a, nah, nah, I have standards. Alright so I got to ask you about the, you know I always had been on the biased side of entrepreneurship which is when you hear regulations and you go whoa, that's going to really stunt the growth of organic innovation. >> Right. But in this case the regulatory peace has been a driver for innovation. Can you share some opinions and commentary on that because I think there's a big disconnect. And I used to be the one saying regulation sucks, let the entrepreneurs do their thing. But now more than ever there's a dynamic, can you just share your thoughts on this? >> Yeah, I mean regulators are not here to drive innovation. That's not what their job is. What's been so interesting about this is that because of regulations coming to Crypto along with these other things, it's allowing businesses to solve the problem of compliance in very exciting, interesting ways. And it's driving a lot of technologies around machine learning, what people like IBM Watson are doing around machine learning is becoming very, very powerful in compliance to reduce that cost. The cost is enormous. An average financial institution is spending 15 percent. Upwards of 15 percent of their revenue per year on compliance. So anything they can do to reduce that is huge. >> Huge numbers >> And we don't want Crypto to get to that point. >> Yeah and I would also love to get the percentage of how much fraud is being eaten into the equation too. I'm sure there's a big number there. Okay so on the compliance side, what are the hard problems that the industry is solving, trying to solve? Could you stack rank the >> I think number one: complexity. Complexity is the biggest. Because you're talking about verifying against sanctions, verifying against politically exposed persons, law enforcement lists, different geographical distributions, doing address verification, Block Chain forensics. The list just stacks and stacks and stacks on the complexity >> It's a huge list. >> It's a huge list >> And it's not easy either. These are hard problems. >> Right, these are very, very difficult problems and there's no one expert for all of these things. And so it's a matter of bringing those things together, and figuring out how can you combine the different levels of expertise into a single platform? And that's where we're going. We're going to that point where it's a single shop, you want to release an ICO? You're an exchange and you need to do compliance? All of that should be able to be handled as a single interface where it takes it off of your hands. The liability is still with the issuer. It's still with the exchange, they can't step away from their regulatory liability, but there's a lot that they can do to ease that burden. And to also just ignore and down-risk people that just don't matter. So many people are in Crypto, not the people here, but there's so many people in Crypto, you buy one tenth of a Bitcoin, you buy a couple of Ether, and you're like okay that was fine. Do we really need to focus our time on those people? Probably not. And a lot of the >> There's a lot big money moving from big players acting in concert. >> And that's where we need to be focused. Is the big money, we need to be focused on where terrorists are acting within Block Chain. That's not to say that Block Chain and Crypto is a terrorist vehicle. But we can't ignore the reality. >> And I think the other thing too is also the adversary side of it is interesting because if you look at what's happening with all these hacks, you're talking about billions of dollars in the hands now of these groups that are highly funded, highly coordinated, funded basically underbelly companies. They get their hands on a quantum computer, I was just talking to another guy earlier today he's like if you don't have a sixteen character password, you're toast. And now it's twenty four so, at what point do they have the resources as the fly wheel of profit rolls in on the hacks. >> You know, one of the interesting things we talk about a lot is we have to rely on the larger community. We can't, I can't, you can't solve all of the problems. Quantum computing's a great example. That's where we look for things like two-factor authentication and other technologies that are coming out to solve those problems. And we need to, as a community, acknowledge That these are real problems and we've identified potential solutions. Whether that's in academia, whether it's in something like a foundation like the Ethereum Foundation, or in the private sector. And it's a combination of those things that are really driving a lot of it's innovation. >> Alright so what's the agenda for the industry if you had to have a list this long, how do you see this playing out tactically over the next twelve months or so as people start to get clarity. Certainly SCC is really being proactive not trying to step on everybody at the same time put some guard rails down and bumpers to let people kind of bounce around within some frame work. >> I think the SCC has taken a very cautious approach. We've seen cease and desist letters, we've seen notifications we haven't seen enormous finds like we see in Fiat. Look at HSBC, look at Deutsche Bank, billions of dollars in fines from the SCC. We're not seeing that I think the SCC understands that we're all sort of moving together. At the same time their responsibility is to protect the investor. And to make sure that people aren't being >> Duped. >> Duped. I was trying to find an appropriate term. >> Suckered >> Suckered, duped. And we've seen that a lot in ICOs but we're not seeing it, the headlines are so often wrong. You see this is an ICO scam. Often it's not a scam, it's just the project failed. Like lots of businesses fail. That doesn't mean it's a scam, it means it was a business fail. >> Well if institutional investors have the maturity to handle they can deal with failures, but not the average individual investor. >> Right, which is why in the US we have the credit investor, where you have to be wealthy enough to be able to sustain the loss. They don't have that anywhere else. So globally the SCC care and the other financial intelligence units globally are monitoring this so we make that we're protecting the investor. To get back to your question, where do I see this going? I think we're going to need to fast track our way towards a more compliant regime. And this I see as being a step-wise approach. Starting with sanctions making sure everyone is screened against the sanction list. Then we're going to start getting more into politically exposed persons, more adverse media, more enhanced due diligence. Where we really have that suite of products and identify the risk based on the type of business and the type of relationship. And that's where we need to get fast. And I don't think the SCC is going to say yeah be there by 2024, it's going to be be there by next year. I was talking to Hartej, he was one of the co founders of Hosho and we were talking on TheCUBE about self-regulation and some self-policing. I think this was self-governed, certainly in the short term. And we were talking about the hallway conversations and this is one of the things that he's been hearing. So the question for you Greg is: What hallway conversations have you overheard, that you kind of wanted to jump into or you found interesting. And what hallway conversations that you've been involved in here. >> I think the most interesting, I mentioned this on a panel and got into a great conversation afterwards, about the importance of the Crypto community reaching out to the traditional financial services community. Because it's almost like looking across the aisle, and saying look we're trying to solve real business problems, we're trying to create great innovative things, you don't have to be scared. And I was speaking at a traditional financial conference last week and there it was all people like this Crypto is scary and it's I don't understand it. >> You see Warren Buffett and Bill Gates poopooing it and freak out. >> But we have an obligation then, we can't wait for them to realize what needs to be done. We need to go to them and say, look we're not scary, look let's sit down. If you can get a seat at a table with a head of compliance at a top tier bank, sit down with them and say let me explain what my Crypto ATM is doing and why it's not a vehicle for money laundering, and how it can be used safely. Those sorts of things are so critical and as a community for us to reach across the aisle, and bring those people over. >> Yeah bridge the cultures. >> Exactly. Because it's night and day cultures but I think there's a lot more in common. >> And both need each other. >> Exactly. >> Alright so great job, thanks for coming on and sharing your insights. >> Thank you so much. >> If you have a quick plug on what you're working on, give the plug for the company. >> Sure, so iComply Investor Services is here to help people who want to issue ICOs, do that in a very compliant way. Because you shouldn't have to worry about all of your compliance and KYC and Block Chain Forensics and all that, you should be worried about raising money for your company and building a product. >> Alright final question since I got you here 'cause this is on my mind. Security token, has got traction, people like it 'cause no problem being security. What are they putting against that these days, what trend are you seeing in the security token? Are they doing equity? I'm hearing from hedge funds and other investors they'll want a little bit of equity preferred and or common, plus the token. Or should the token be equity conversion? What is some of the strings you're seeing? >> You know I think it' really just a matter of do you want paper or do you want a token? Just like a stock certificate is worth nothing without the legal framework behind it. A security token is the same way. So we're seeing where some people are wanting to do equity, where some of their investors want the traditional certificate. And some are fine with the token. We're seeing people do hybrid tokens where it morphs from security to utility or back. Where they're doing very creative things. It's what's so great about the Ethereum Network and the Smart Contracts, is there are all of these great options. The hard part then is, how do you fit those options into regular framework. >> And defending that against being a security, and this is interesting because if it converts to a utility, isn't that what security is? >> So that's the question. >> Then an IPO is an, again this is new territory. >> Right, and very exciting territory. It's an exciting time to be involved in this industry. >> In fact I just had an AE3B Election on tokens, first time ever. >> Yeah it's an amazing state that we're in. Where serious investors are saying yeah token's great for me. Give me the RC20 I'll stick it in my MetaMask Wallet, it's unbelievable where we are. And only more exciting things to come. >> Greg Pinn, thanks for coming on and sharing your insights. TheCUBE covers live here in Las Vegas, Hoshocon, the first security conference in the industry of its kind where everyone's getting together talking about security. Not a big ICO thing, in fact it's all technical, all business all people shaping the industry, it's a community it's TheCUBE coverage here in Las Vegas. Stay with us for more after this short break. (Upbeat music)

>> Live from Washington, D.C., it's theCUBE. Covering Inforum DC 2018. Brought to you by Infor. >> Good afternoon and welcome back to Inforum 2018. Our coverage here on theCUBE as we start to wrap up our two days of coverage here at the show. We're in Washington, D.C. at the Walter Washington Convention Center, along with Dave Vellante, John Walls here. We're joined now by Mayumi Hiramatsu, who is the SVP of Cloud Operations Engineering and Security at Infor. Mayumi, how are you doing? >> Great to be here, thanks for coming. >> And a recent honoree by the way, Woman of the Year at the Women in IT Awards, so congratulations on that. (clapping) >> Awesome! >> Thank you. >> Very nice honor. >> Great. >> Tell us... big picture here, cloud strategy as far as Infor is concerned and why that separates you from the pack. What makes that stand out, you think, from your peers? >> I think there are a couple of things. One is that when I think of cloud, a lot of people will think about cloud as, it's a software running in the cloud, but it's more than that. It's about the solution and the capabilities that we're building on the cloud. And Infor is perfect, in that we're building enterprise software solutions. So if you look at Infor and compare us to the competition, we may have multiple of competition wrapped together in a solution. And that's really powerful, and you can only do that, really well, in the cloud because it's already built for that. It's integrated and the power of data is really amazing, because when you think about cloud, it's not just the software, it's the data, what you can do with it. And with the latest technologies around artificial intelligence and machine learning, there is so much insight we can give to our enterprise customers to make them successful in their business. So, I think of cloud as not only the technology, which I love, because I'm actually an engineer, but it's really the business transformation, digital transformation that the cloud enables, with the technologies like artificial intelligence, data analytics, data science, machine learning. There's just so much bolted on, that you can really only do in the cloud. >> Can you help us understand that competitive nuance? >> Yeah. >> I'm not sure I fully understand, 'cause others will say, well, we have cloud too. What's different between the way in which you provide solutions in the cloud and... pick a company. >> Yeah. >> Another company says, we have cloud, all of our SaaS is in the cloud. >> Right, so I think the first thing is, Infor's always focused on solutions, which means that our competition may have one of, let's say, a dozen things that we put together. So, if you're using our competition, they may have a cloud and some of them were born in the cloud, but then you have to figure out, how do I integrate it with the rest of the world? Because if you think about it, ERP. It's running your business. And it might be your HR and about your employees. It might be CRM and customer information. It could be supply chain and figuring out what parts I need to buy. It could be billing and figuring out how do I bill my customers. All these different solutions today, if you look at our competition, they may solve one, two, three different portions, but certainly not a dozen of these all together and then tailored towards the industry. So, we can pretty much bolt on and get started pretty quickly, if you think about, for example, healthcare. We already have a healthcare solution ready to go, so you don't have to figure out how do I put 12, 15 different software, glue it together and make it work? And maybe some of it is running in the cloud, maybe some of it is not running in the cloud, then the integration and making it work gets really complex. But ours is already pre-built, ready for that, whether it's healthcare, manufacturing, food & beverage, fashion. We have a lot of these already ready to go, so then you just have to customize it, as opposed to starting from scratch, figuring out how to integrate all these different software, making sure they work together and then harnessing the data, and then adding all these different, artificial intelligence and machine learning capabilities that is so powerful today. You can't do that without the cloud and you certainly can't do it if you're trying to glue together different solutions. It's just really not easy. And I'll add one more thing, I was talking to a customer about this today, which I thought was brilliant. The other thing is security. Most people worry about security in the cloud and I run our security as well, the Chief Information Security Officer reports in to me and the whole security team does. And I can tell you, if you're combining 12, 15 different types of software and trying to have consistent security all across? Oh, that's a very difficult thing to do. But we've already figured it out. So all you have to do is buy the package, the solution, it' already working together. You already have security overlay on it. They have consistency in terms of how we manage the security, whether it's single sign-on and who has access, and making sure that that gets all the way through, all the way up to the data lake, where all of the data gets captured, all the way up to the artificial intelligence. So, if you think about security and how important that is, and how difficult it might be to do on one software, let alone a dozen software, the fact that we've already built that, is a big differentiator. >> So it's all there, and when you talked about, all you have to do is customize it, you're talking about, you're not talking about hardcore coding, you're talking about things like naming and setting it up. Is that right? >> Yeah, and-- >> Or are you talking about deeper levels of custom mods? >> In our multi-tenant cloud, we don't do mods, but instead, we have extensions. And extensibility is really important because now those are, again, essentially plug-and-play. We already built it for you, so it's so much easier than creating each piece of code every single time. Again, it's about, how do you make sure that you can integrate these very important sets of business processes together. Not only how quickly can you use it, how secure is it? And ensuring that you can actually focus on your business value, right, because trying to assemble all of this together and making it work, it's an enormous amount of work and I think, as an enterprise, you want to focus on actually giving customer value instead of trying to figure out, the mechanics underneath the hood. >> I mean, you certainly get the value of cloud software, right, and cloud ERP. Who doesn't? Like out of the industries that you're trying to, get in front of or whose attention you're trying to get. Where's the, if there's someone that's kicking and screaming a little bit, who might that be or what might that be? >> I don't think that there's a specific industry, if you will, I think some industries, in fact, and when I think about it, all industries are getting disrupted, right? If they don't, they're actually getting left behind. So, I think some industries feel it more, as in, they might be behind the curve. And I wouldn't necessarily say industry, maybe some of the companies in that industry. >> Companies within? >> Yeah, are waking up to it. I went to a Gartner Supply Chain Conference a couple years ago and they were talking about bimodal supply chain, right. You have the teams that are doing the old way and then companies that are doing the new way. And companies are literally going through this shift. And I had this interesting conversation that it's really not bimodal. Companies are essentially somewhere in that spectrum and what they need to do is figure out from point A to point B and how you make that transition. It's a huge transition. I would also say that there's a cultural element as well, and so one of the key things that, especially for companies that are moving from on-prem to cloud. As a provider, it's really important to realize it's a completely different business model. And it's not always talked about, again, a lot of times people think, oh well, you know, Infor, you just moved the software into AWS and you're calling it SaaS. It's more than that. Besides the capabilities, its a huge cultural shift that even Charles talked about on-stage, which is that, software companies you focus on the product, versus, as a SaaS, the last 'S', Software as a Service, you are focusing on the service. So, the analogy I use a lot is, maybe we were actually a food company, we'd build beautiful food, delicious food, nutritious food, maybe it was a rotisserie chicken, right? But now I switch to a restaurant. Food is only table stakes. And you know, restaurant reviews is about services, the ambiance, how quickly you respond, how clean it is, all these other elements matter. And if you think about Infor or any other company for that matter, that we're focused on product and software, to then becoming a SaaS service provider, it's a huge transformation for a company, and I can tell you we're going through that, right? Infor as an on-prem company moving to the SaaS, and there's so much focus now on customer experience, is because realizing that we're no longer a software company, we're a Software as a Service company. And there's a lot more we need to put in, in terms of making sure the customer experience is good. As our customers go through the same journey, they also need to realize, it's no longer about providing that product, but the experience that they're providing to the customers, and we see our customers actually going through that journey. Some might be harder to move within whatever industry, because maybe they have legacy product, legacy machines, right, to be able to lift and ship to quickly. But there's definitely a path, and if you think about some of these industries that's been around for a long time, they're definitely going through this transition, and in fact, I think they have to. >> So how did you set priorities in terms of, you come to that recognition that we're services, in the cloud. Luckily, you don't have to manage data centers, so you could take that off the table, so what were your priorities and where did you start, and what are you focused on now? >> One of the first things that I did was really pushing this cultural shift for the company, because a lot of people, some people may think, okay, it's software, I'm putting in the AWS, it's cloud. But all the other service elements, like that restaurant analogy, it wasn't mature in terms of where we needed to be and therefore you hear a lot about customer experience and customer success and a lot of these elements that we really have to put more emphasis on. But the other areas that I focused, so I came in, I focused on cloud operations, security, tooling, and architecture, that was the set that I was focused on. What I did was essentially transformation, right, it's People Process Technology in addition to culture, so culture we already talked about, the sense of urgency is very different as well. On-prem, maybe you don't have to respond in two seconds, but in cloud, you do, and so making sure that we had crisp KPIs, which are different than on-prem, making sure that processes were completely redefined. I've actually done benchmark with our competition to see that our SLAs and KPIs are either on par or better. I'm a big proponent of engineering and technology, so we built a lot of technology monitoring, tooling, so that we can do a lot more in terms of self-service and automation, that's really the only to scale, and execute consistently. Spent a lot of time over the last year, literally re-defining the identity of our jobs to how do we make sure we have the right skillset, and retraining some of the folks who may have a new identity and they need to learn new skills, to coming up with new tools and technologies that they can use, to changing our processes so we can up our SLA and make sure that we're either meeting or beating our customers' SLAs, complete transformation in the last year. >> You must be exhausted. (laughs) >> When do you sleep? >> I don't sleep much, but... >> You must not. >> So, new metrics, this is intriguing to me. Can you give us an example of sort of this, new KPIs as a result of this cloud, SaaS world? >> Yeah, for sure. I think every company has their own sort of core KPIs that are public, and cloud is usually uptime, right? If you have support, it could be how quickly you respond, we call it mean time to respond. Underneath the hood, I've created key KPIs for, what I call, critical cloud qualities. One is, of course, reliability, so that would be in addition to uptime, like 99.7%, which is two hours and 11 minutes by the way, per month downtime, so making sure that we're actually meeting that. >> Sorry, just to interrupt. >> Yeah. >> You're measuring from the application view right, not the green light on the server, is that fair? >> That's a great question, because that is exactly the evolution we want as well, so when I talk about the transformation at my organization, we were measuring the hardware first. We are now measuring, essentially, outages. So I don't care if the server's still running, but if the customers can't log in, it's an outage, right? But that's not something you can monitor by looking at a server because sometimes the server's up and running. But maybe a process went down. >> System's fine. >> Exactly. So that's the monitoring-- >> Okay, so slight adjustment in the typical metrics, sorry to interrupt, but please carry on. >> That was a perfect question. >> Okay. >> So KPIs, so underneath the hood, so here are some examples of metrics for availability. Mean time to detect, that's an internal metric, and my internal metric is five minutes, meaning, if you don't know we have an issue in five minutes, it's probably not automated and monitored, so we better hook up some additional monitoring as an example. Mean time to respond, that's a very public one, a lot of times, customers demand that, and if you look at competition, that is the only metric that's actually public, potentially even on a contract, right? So we have mean time to respond, we also have mean time to resolution, that's usually an internal metric. I'm sure competition has that as well, but making sure that we have that response right away, because it's one thing to respond, but if it's not resolved as quickly, it's not good. Other metrics when it comes to reliability, mean time to communicate. And this is really interesting. One of the things that I found was, we could be working on something but we're not telling the customers, so they're wondering if we're actually sleeping on the job, even though we're actually actively working in the background, right? >> Did they get the message, right? >> Right, so mean time to communicate, as an example of reliability metrics. So reliability is one of the core tenets. The other tenets? Performance, how quickly do you respond, right? And I always say that if performance is too long, it's equivalent of being down. Imagine if you're using Google and you put a search in, and it takes you three minutes to get a response time, you probably have left by then. So that performance, page load time, page response time, these response times actually matter. So we have actually metrics around that and we monitor and manage them. Security, we have a boatload of security KPIs, whether it's number of critical vulnerabilities, how quickly we respond to security incidents, a boatload of those as well, and then, last but not least, agility. So how quickly we can respond if we have to do a deployment. So what that means is, let's say, every software company has a bug, and let's say we actually had to quickly respond to that, can we do it within 24 hours if we needed to? Security is a perfect example. A mature company should be able to say, okay, there was a security alert that got to the industry, right? We should be able to quickly respond to that and apply a patch immediately and address it. A company that may not be so mature, it might take them months to go through thousands of machines. So I call that time to market, how quickly can we actually deploy something, and that's not just deploying it, but testing it and making sure it's not going to break anything and be able to test it and verify it. So these are examples of metrics-- >> Great examples. Are your SLAs... for a SaaS company, your SLAs presumably have to be more strict than you'll contractually agree to, but maybe not, then your typical SLA out of AWS or Google, or Microsoft Azure. Is that true? >> Yes. >> So you guys will commit contractually to these types of SLAs that you would expect in an enterprise, versus kind of the standard, off-the-shelf AWS SLA, and how do you reconcile the gap or do you have a different agreement with AWS? >> We do have a... The SLA is pretty much standard when it comes to AWS specifically, right? >> 'Cause they want-- >> Yeah. >> Homogeneity. >> Exactly. So I think the challenge is, every SaaS provider needs to architect around it and when you think about it, hardware failure rate is usually 4% industry-wide. You can expect the hardware will go down, right? >> Yep. >> Network goes down, various things go down. So then it's our job that sits on top of it, to make sure that we build it for reliability. Perhaps we actually have redundancy built-in, and we can actually go from one side to the other, we have that, for example. So if AWS goes down, and they do, all right? I ran data centers for many, many years, it happens. It's our job to make sure that we can fail over it, and not have that customer experience, so it's an overlay availability that we have to build-- >> You're architecting recovery into the system, I know we're tight on time, but I got to ask you, 'cause Pam couldn't make it today. You're part of the WIN, the Women Infor Network, I presume, right? >> Yes. >> So maybe we can just talk a little about that-- >> Yeah. >> It's a great topic. >> Women in technology, right? >> I got some of the best interviews at Infor shows with women, Deborah Norville came on, Naomi Tutu, Lara Logan. Just some awesome folks, but so-- >> So your thoughts, we know you're passionate about the role of women in technology, so how you feel about that, if you want, and Infor, what's being done, or what can be done about that? >> Great questions. So I'm a big proponent of women in technology. Partly because I went through my pain, right, I've always been a small percentage in terms of engineering role as female in technology. I'm also a board member of Girls in Tech, and I channel my energy that way as well as I try to mentor and help others, for example, mentoring engineering students at Berkeley. I'm a Berkeley alum. And I think it's really important that we get more women in technology and keep in them in technology, and candidly, our latest trend is actually going down. So the reason why I think it's important, besides making sure that everybody has a chance, and all those good reasons, we have statistics that actually show, the more diversity you have, the better your product is going to be, and the better it's actually going to hit your top line revenue. And over and over again, whether it's women in the board seat, or women executives, or women engineers, no matter where, by getting women's input into technology, you're actually representing 50% of the consumer base. >> The user base, right. >> Right and so, if we don't do that as a company, we're actually not going to be able to get the user base feedback and I think it's so really important, not only for the economy to have those wonderful workforce in the job, but also for the company products to actually reflect the user's needs and actually improve the revenue, right? So from that perspective, I think it's really important, I love the fact that at Infor, we do a couple of things when it comes to diversity. So one, is WIN, as you know, Women Infor Network. I think it's a fabulous program, and in fact, I get a lot of male colleagues saying they want to join WIN, and they do. My last session, there were actually women and men joining it, because it's really about leadership and how do we cultivate our next, next talented workforce to be successful. The other one is EAP, the Infor Education Alliance Program, so that not only looks at women, but just diversity, right, and bringing students into this workforce. I think it's a great way to help the economy, help the products, help the company. And at the end of the day, why not? >> You're awesome, super impressive and articulate, and really self-confident, and hopefully an inspiration for young women out there watching, so thank you so much, really appreciate it. >> And hope you get some sleep sometime too. (laughing) >> Thank you. >> Busy, busy schedule. All right, thank you. Thank you Mayumi. We're back with more here on theCUBE, you are watching us live in Washington, D.C., and we'll be right back. (upbeat music)

>> Hi from Toronto, Canada. It's the CUBE covering Blockchain Futurist Conference 2018 brought to you by the CUBE. >> Welcome back to the live coverage. Day Two of the CUBE here in Toronto, Ontario in Canada for the untraceable Blockchain Futurist Conference wall-to-wall coverage Day Two. A lot of action going on. Tons of great content, tons of great after-hour networking. Just overall great vibe. In light of the market crashing, bitcoin stabilizing, some old coins getting crushed. We got it all covered for here. I'm John Furrier, your host for the CUBE, and our next guest is Nithin Eapen, who's the chief investment officer of Arcadia Crypto Ventures. Arcadia Crypto Ventures, welcome to the CUBE, good to see you. >> Hey good to see you too John. Thank you for having me here. >> Keep alumni in the know. Okay. So first of all, you're an investor in crypto. Everyone's running for the hills. A dip is happening, a crash, or some will say. Your perspective, what's happening in the market? >> See, happening in the market. So typically just like in any asset class, there was a huge run-up that happened very quickly. It didn't go up slow, alright? And the geeks were in early, the libertarians came in after that, then there were speculators. And the retail market also came in, and they all came in together for let's say the December after the November Thanksgiving week and everybody learnt about cryptos, they came in. Alright, the next set of guys haven't come in. Alright? So there's nothing for them there. Nobody's holding them there. And there were expecting the institutional investors to come in and that hasn't happened due to custody problems, ETF problems and all that stuff. Alright, it started going down. The weak hands are falling. The weak hands are keeping on falling and as with any technology, any bubble of people have come in, now they feel that okay the world is coming to an end and they are selling all their stuff. All the ICOs that have raised money in Ether, selling the Ether. All this together is pushing it down, and everybody's waiting for that next set of investors, or the, every 10 X, I mean, an asset goes up, there's a new set of guys who are supposed to come in, and this time it hasn't come in and we're waiting for that. >> You're on the panel here at the event. A lot of different panels, but one panel I watched you were on, you talked about the token model, people were holding Ether. It's kind of a debate, you know, and Bradley Rotter, another investor was saying, hey, there are too many tokens out there. You had different perspective, but one of the things I wanted to get your reaction to is that people who held on to the Ether lost their runway and it creates a harder road to hold. So people were converting to Fiat. This is a big issue. How are we going to get by this? This whole lot of Ether, more people are going to come in. The dynamics of investing in this token model, has it changed? How are you looking at it, and I'd say, how do you help startups? >> So regarding a lot of tokens, first thing is there are a lot of tokens out there. See that is going to happen. It's just like in the 1999, okay, a lot of websites and a lot of Internet companies, pet.com, everybody's an Internet company. Same way, everybody is a token. 95 to 99 percent of them are going to go away and the good ones will rise from those ashes, okay. Now regarding runway, a lot of these projects have pretty much raised enough money for 50 years of runway. So it has crashed one-fifth, okay, they have 10 years worth of runway. Typically, in the olden days, a small company with an idea or a MVP was max going to raise one million to two or three million, alright? And all of them anyway have that even after Ether has crashed. I'm saying, just don't panic okay? You still have 10 years worth of runway. Utilize that, build upon it because the high period may be over where you can just raise money on a white paper. You've got the money, build yourself. You promised your real investors I'm going to build this great thing. So this is where we're going to see the great founders to the average and the bad ones where they've hit a wall, they don't know what to do, they'll fold their hands and walk away. Really good founders, they're resilient. They will, no matter how hard they're pushed to the wall, they're going to come up with the product, you see, and they're going to try to meet customer demands. They're going to get through the feedback loop, check what the customer wants and start delivering it. >> So basically what you're saying is there's so much money being raised, and I agree with you by the way. If you go the classic venture capital route, if you had a Powerpoint or prototype or even a working product with recurring revenue, your serious preferred stock financing will be anywhere from three to 15 million. >> Oh my god. And that's high end. >> That's a high end. >> 15 million will be on the high end. Some cases are raising 50 million, some cases 70 plus million, so even if you cut that in half, it's still a better outcome on the first round. I agree at that, so I think that's interesting. The other one that you mentioned is that things are dynamic, that we're seeing here at the show is in the hallways, everybody's talking about flight-to-quality. And I was talking yesterday on the wrap-up of Day One that you can tell the good deals from the bad deals by is the venture architecture working for the coin, or is the coin working for the venture architecture. And so this flight-to-quality combined with how people are optimizing their build up is critical. >> Yes. >> Talk about some things that you're seeing with this flight-to-quality. Is there anything in particular? Is it blockchain? Is it token economics? Where's the quality deals from your perspective? >> I feel quality lies in the founder of this. The founding team, because the idea, if you really ask me what is an idea here? An idea is just like mental masturbation. Guys who sit there can come up with so many ideas. That's what ideas are, okay? Now taking these ideas to fruition, like building it. There's a capital raising part, okay? Now a lot of people are good at capital raising. They're raising money and a lot of capital coming in. That's awesome because you need capital to attract talent to the space because a lot of talent who are maybe in astrophysics or in mechanical engineering, you want that talent to come here and come with ideas and build the stuff. Okay, the capital has come in. Now once the capital has come in, you really have to build the stuff. Even after you build the stuff, you have to go find the customer right? You have to go and acquire customers and all these three things coming together are so hard in reality. And that's why the venture capital always give a little bit of money to make sure that these guys are not wasting the whole thing away, right? >> Well, the other thing I want to get in touch, get on to you is here is that, in the old days, Silicon Valley, you got to move there, the VCs were there. Now, talking about the global phenomenon, the capital formation is both inside the United States and outside the United States. Certainly inside the United States, you're starting to see the formation around traditional structures, security token, which is more like, it feels like a security, a more preferred financing model. Equity's now involved. Outside United States, a booming utility token market. Your thoughts on how that's progressing, still open, still crazy? What's your thoughts? >> So the capital model, the beauty that has happened today is, earlier, you had to pitch to two hundred VCs or three hundred VCs to get one guy to put money into it. Most of the time, they'll be wasting your time, alright? So you had to go to them to get a million. And you didn't have any other option. You couldn't get it from a small enthusiast of your project to give you five hundred bucks or a thousand bucks. So now, you have that option, okay. Now that option is being cut by regulation, by the STC and people like that coming in saying, oh you can't do that, it has to be a security token. Alright, let's make it a security token. The moment you make it a security token, my question is, can you raise money from outside? Are you stopping that? Then again it doesn't really make sense. You're cutting the small investor, the chance for him to buy into a good, okay? It was only the VCs like Sequoia, or somebody like that, who could access a deal like Google. Now we have a chance for something like Google to come up with the common man whose putting five hundred, like Ethereum. There was no venture capitalist or Wall Street who got involved in Ethereum. The real money was made by very common people who supported a decentralized world computer. >> All CVCs get it now, market entries or whoever's getting involved, starting to see VCs dabble in there. Has that changed the investment dynamic at all? >> It has because the VCs, they have this feeling they've missed out, right? So now they're putting in five and 10 million dollars into a project, valuing a project to three hundred million. It changes the dynamics because now all these guys, like, there are so many projects that are raising like a hundred million because the VCs, all these private investors, are giving 10, 15, 20 million. Like recently for example, they've raised a 300 million dollar fund. They can't invest 10 thousand to 50 thousand to 100 thousand, right? They have to push 10 million to manage the money. That is skewing stuff, and I personally am not very interested in those kinds of projects, because it's without a community power at that time, so I don't know how the token economics is going to be fruitful for the second investor, the third investor. >> And Block Tower, we found out yesterday, is also investing in putting a fund together, a venture fund. It's interesting. We'll see how that shakes out. One thing that is going to change is the dynamics. You mentioned community, obviously, a big part of that. Big community here at the Futurist event, Toronto. So they've got a Canadian culture, a lot of Ethereum DNA in this area. What are you hearing at this event? What are some of the things that you're hearing in the hallways? You've obviously been on some panels at this event, and you're highly networked. What are you hearing? What's, with your ears to the ground, what's it telling you? >> You were talking about Block Tower, yes, they're doing a venture fund. It's great. He's a very very smart investor and they're going to do very well. On the ground, so most of the questions right now are coming, so we've reached the point that okay, we have built up the blockchains or the bit coins. We want it to be faster, alright? Everybody's looking for scalability. Who can bring scalability? The EOS guys are out there. They are saying they can do, you know what, five thousand or 10 thousand or 100 thousand transactions per second. So scalability is a very very big thing. I personally consider something like interoperability, bigger. Interoperability in the sense, alright, so now you have these multiple chains. It's just like multiple types of phones. Now imagine you had an AT&T phone and you couldn't call the Verizon phone customer, alright? We're at that point. We have all these chains, there's Ethereum, there's One Chain, there's EOS. Okay, I've built, let's say, a distributor app, let's say it's a poker app on Ethereum. But I can't play with the guy who's on EOS right? What if he also wants to play poker in this poker app? Is there somewhere we can make this integrate and interoperable? Now to make it interoperable, now we have, if we go into details, there are assets, there are tokens on both sides. How can we transfer tokens from one chain to the other chain making sure there's no double-spend happening? >> I mean there's two things. That was the consumability, making it easy to use, one. And two, I think you're right on. Interoperability's huge. You got to have that. >> Interface, as you said. Interface is big. To make it simple, it's still the geeks. In geeks, a lot of people are using command lang prompts. You can't expect the common man sitting at home. It's just like email. Email was there from 1978. It's only when all these tools like, beginning '94, and the browser came in, that people started using it. So those things have to come in. >> A lot of work's got to get done. So many on the blockchain side. Well, great to have you on. Good to see you. Congratulations on your panels and this afternoon, you're doing a good job. Thanks for coming on. I appreciate it. >> Thank you so much, John. >> Any predictions by the way? >> Predictions, I don't know, I'm not a predictions guy. I just go with the market. >> Price of bitcoin 20 thousand? >> Oh I never get into those predictions. I never want to get it. I think that it's possible that the bear market can continue for a longer time based on the fact that the newer money cannot come in. It has happened before. Bitcoin has fallen so many times at the 70, 80 percent range and then it stayed stagnant for a year before the next round up came. >> And certainly we got work (inaudible). Thanks for coming on. Keep coverage here live in Toronto, Ontario. Keep coverage here with the untraceable Blockchain Futurist Conference here of two days. Day Two, keep coverage. We're back after this short break. Thanks for watching. (electronic music)

>> Live from Toronto, Canada, it's theCUBE, covering Blockchain Futurist Conference 2018. Brought to you by theCUBE. >> Hello everyone and welcome back to theCUBE's exclusive coverage here in Toronto, Canada, in Ontario. We are here live breaking down what's going on in the Blockchain world. It's the Untraceables event here, Tracy and team doing a great job of Untraceable. They're putting on the Blockchain Futurist conference. This is about the future, bringing the industry together. All the luminaries are here; Bounds of Ethereum, Ackerson Ecosystem influencers, original gangsters- OGs-are here, of course theCube, we got 2018 coverage breaking it down, I'm John Furrier with Dave Vellante. Wrapping up day one Dave, I know you got to take off and head back on a flight home, let's break down and analyze what's going on in the industry. Yesterday we had the first annual ever, first inaugural Cloud and Blockchain summit, global Blockchain and Cloud summit, two worlds coming together. Here it's a little bit different this is all about cryptocurrency, it's all about blockchain. Big movements, speculators versus builders is my theme and everyone's recognizing the trend of price shifts billions lost in market gap that were gained last year but still some are up. But the focus is about entrepreneurship on a global scale, this is the focus here, right? It's a lot of VIPs, a lot of players coming together. I don't see people crying in their wine about the prices- although you can see it on Anthony Di Iorio's face, probably a setback or the Ethereum community on the price but still, the long game is what they're going after. Your thoughts and analysis? >> Well you definitely seeing a lot of talk about the boom and bust cycles. And we're hearing a lot from people -but by the way, there are a couple of guys who went big, maybe hedge fund guys or other fund guys that are taking a bath, maybe they got in big in January, December, not the best time to get in. So you are seeing some long faces there, but generally the sentiment is: hey, these boom and bust cycles they come and they go we've seen them before, now's the time to hunker down and innovate, execute, and figure out how to add substance and value. Now, first of all, I would say a couple things. One is those guys probably have... a store of fiat currency that they cashed out, number one, so they're feeling pretty good. Two is, the big difference to me John, is in 2018, crypto is much more in the mainstream news. You see it on CNBC, you see it in every medium po- every day you get a medium post, everybody's blogging about it, whereas obviously we've been blogging about bitcoin for five, six years but the mainstream media has picked up on it. >> Seven years. >> Seven years, there you go. So the mainstream media has picked up on it so it's much more front and center than it ever has been in the past. So I think that's a different dynamic. There seems to be still a lot of opportunistic sentiment, people are sanguine about the future and I think that's because we're seeing some real hardcore innovation going on in real use cases. Now, having said all that, the other scenario is there's just a lot of competition for quality projects, we're hearing too many coins out there, you're seeing all these ICOs tied to Ethereum in an oversupply right now, and you're clearly seeing that affect the price of Ethereum, which has dropped, on a percentage basis, much more than bitcoin. It's down considerably this year, whereas bitcoin actually is still up. Ethereum's trading about where it was last September, Bitcoin's up considerably since last September. So you know, a lot of cycles, a lot of instability still, but a lot of optimism. >> The bottom line for me is that the big question that's coming out of this event and this whole week here in Toronto is why do cryptocurrencies matter, the mass influence and adoption of Blockchain technology, where is that on the progress bar? This is the topic, and again, a lot of people that are "poo pooing" this revolution and I'm seeing on my Facebook feed all the time, "bitcoin's at zero," there's a lot of nonbelievers. Here's what I would say, here's my analysis. I think that the comparisons to the dot-com bubble with all the irrational exuberance that was part of that phase, this ICO phase, is crashing. No doubt about them. The ICOs in the United States are down, almost to nill. Certainly a lot of action going outside the United States, still unregulated, still wild, wild, east- or west depending how you call it. So yeah, that's happening and a lot of the bad stuff's being filtered out there's an emphasis on build which you mentioned. But here's the thing that no one might not see in the mainstream. During the dot-com bubble, there was all this companies that were started to it public and that was because the market wanted it. That's what happened with the cryptocurrency ICOs, the market wanted more products, then just manufactured it and then they realized, oh shit too many tokens. But if you look at the internet revolution, and I think this is the comparison with blockchain and crypto. You got blockchain technology, cryptocurrency, which is token economics are absolute gamechangers and the demand for that is very high and there are more people coming on every day in a mass adoption basis. The internet actually never stopped, if you looked at internet penetration rates, Mary Meeker would point out at Morgan Stanley, now she's at Kleiner Perkins, that the internet adoption rate of the internet during the bubble and then post-bubble continued to accelerate. That means more people got on the internet. So therefore the population of users became larger and larger every day. That really level-setted the reality that this was not a fad, not going away. I see blockchain and token economics having the same trajectory where there'll be more people adopting the technology then putting it into use than ever before. That's the tell sign. If that trend line continues to grow, the corrections will all take place, cycles will happen, but the entrepreneurs will follow the money, they're going to follow the user experience, they're going to follow the demand for opportunity. That to me is going to be the major tell sign. I think that's the general sentiment that I'm feeling here is screw the price of the tokens, yes there's too many tokens, clear out the dead wood, get back down to building companies, that's validated by the fact that there are more deals being done from a financing standpoint that are starting to look like traditional funding structures. Security tokens, equities, starting to see people talk and fundraising, lower rounds, not the big mega rounds. Money that's going to be around 7 to 30 million, 30 to 50, 50 to 100, 100 plus. This is going to be traditional structures, not the land grab utility token which gets you into the tailspin of basically managing coins distribution, managing all these things. There'll be a balance, but that's really kind of what's happening. >> So that's great analysis John, I would add to that that the fundamentals are still in place, blockchain attacks inefficiencies. Where there's a middle man and there's inefficiencies and there are waste, blockchain is being applied to attack those inefficiencies. I think the second thing is that new capital-raising vehicles have catalyzed massive investments and are catalyzing innovation and a whole new breed of developers. The third point is a global phenomemon. You don't have to be in Silicon Valley, or New York City, or Boston, or Austin, in the United states, or from an Ivy League school, it's happening around the world, you're seeing non-US countries and island countries invite developers in, giving them tax havens, and as a result, it's becoming much more of a global phenomenon than a lot of the internet startups were. There are a lot of adoption barriers. I mean you have the cyclicality and the volatility, you've got industries that are essentially entrenched: financial services, healthcare, lots of defense and aerospace industries, very much entrenched, it's going to take a long time for that collaboration to come together. And you also have a lot of scams. >> Yeah >> There's going to be a shake out, we predicted that I think in February in the Bahamas, we predicted the flight to quality, people are trying to figure out where that quality is right now. And to your point, you're also seeing more hybrid models, more traditional equity models combined with token models, and that's not a surprise. You're going to see more and more of that as a hedge. The token model still gives people the potential for liquidity, and as long as that fundamental remains in place, I think that dynamic will- is here to stay. >> And also, you and I have seen many cycles of innovation you talk about in the industry, many waves. The people that we talked to that have been through multiple waves like Brailey Rodder, (mumbles) and others, experience, they all know what's going on. The difference here that I think is interesting is that the smart contrast, the flight to quality, the companies that have buildable products, are going to get the attention. Now the difference now in this community that I think is interesting that makes the funding dynamic different is you have now community dynamics. You've got open source software, Cloud computing, and new technology with new capital formation dynamics. I think those three things are the perfect storm of innovation that's being overlooked. and the interplay between that is going to give us a look and feel of an industry that we've never seen before. So we can compare and contrast waves "oh, BC, Client-Server, blah blah blah," I don't think this is going to look like any of those waves, it's going to look different. And that's going to be really the shake out between the pundits who claim they know what's going on, or... predictions whatnot. Talking to the people, putting the ear to the ground in the communities, that's key. And for the companies, the ones that are going to win are the ones that can build community, tap into communities, and grow communities because they're now part of the ecosystem. It's not just selling products to them, they got to be a bidirectional, symbiotic relationship between communities at large, in this ecosystem. I think these are going to be new dynamics they're going to be- impact valuation, it's going to impact time to market, time to value, and ultimately give the entrepreneurs and the investors what they need, which is good outcomes in the process. >> You know it's interesting you were saying about the waves. And the waves in the past, and certainly looking back, were quite easy to identify, they tended to be architectural, you know centralized mainframe, and they went to client server, then you went to the sort of public internet, and then this cloud of remote services. The next wave is maybe not ... blatantly architectural, but it's this blending of digital services that's ubiquitous across all industries. And I think the key is, there's an automation layer on top of these digital services, which is powered by AI and machine intelligence, machine learning, and deep learning, and blockchain is part of that automation layer. And people are building new businesses on top of that and disrupting existing industries. I think there's no industry that's safe from disruption as I put it before, there are some entrenched, high-risk industries like financial services, healthcare, defense, aerospace, education, that are going to take longer but ultimately there's waste in all of those businesses and I will say I think a lot of the incumbents are going to hop on this trend and do very well picking up blockchain and defending against the disruptors. Not all will make it, but a lot of the big guys are going to put some serious resources into this and they're going to lead in to blockchain in a big way. >> Yeah and just to kind of wrap up, I think you're the fact that what we're seeing here is that engineering-led dynamics are happening, blockchain's going to lay down the plumbing, it's got to be stable, desensualized applications over the top with token economics is the business model of innovation. We got technology theater booming with innovation with engineering-led initiatives, that's got to accelerate, that's infrastructure, that's got to be more cloud-like, that's got to be much more stable, that's got to get laid down, got to put the roads down if you will, and then the business model innovation coming from the software this is the game changer so you're looking at all the smart money, smart money is saying okay, we see guys building product, let's see some unique IP, let's see some token economics that are nobel and different for what's happening, that to me is going to be the new investor algorithm if you will, for vetting. And it's been that way in a way, the smart money follows the smart engineers, what are you building? And then they vet that with other stands so again, big engineering-led focus. >> So what would you do now- okay, soyou were hearing this week, too many damn tokens, everything's tied to Ethereum, most ICOs, what would you do now if you're an entrepreneur, you have an idea, you have a potential to build a community, where would you focus, would you just try to float another token? Would you go overseas? What would you do in that situation? >> I would look at the regulatory frameworks as a way, as a guidepost to risk management, right. I think you're going to see some regulatory regimes try to manage the bridge between slow changing, old guard, to new fast, and loose. Crypto-'Cause look at it. It's fast and loose, but there's real people that are working on it. I would focus on the real people that have builders, I'd look at the mechanisms where they're domiciling, and what they do with the economics or the tokens. One thing I will tell you that is that, as an entrepreneur, this is like, a golden rule, your focus is everything: focus, focus, focus. If you're focused on managing distribution of coins, and the arbitrage of coin pricing, that takes away form the focus of engineering and building. I think that's going to be an easy binary test for an investor to say, "what are these guys working on?" Is the token working for the venture, or is the venture working for the token? That is a fundamental mindset, if that is... Not in the right position, it should be: the token works for the venture, not the venture working for the token. That to me, I would run for the hills, if I see someone working for the token, I'd say, "I don't want to fly at all at that deal." Because you could maybe pass up some money right in the short term, but you're going to miss the long game. That's the way I look at it. >> And again, I would add to that, I mean, yeah, okay, so there are a bunch of crypto-billionaires that got minted, and they got in early and good for them, but that doesn't mean there's not more opportunities. And when I think of a company like Dell Michael Dell wasn't the first in PC's, you know? Compact was the first, you know, Rod Canion, the back of the napkin, that urban legend. But what Michael Dell did is he improved on the system. He took inefficiencies out of the supply chain, and became the dominant player! So first move advantage, yes, okay, great, you missed being a billionaire potentially. But the wave tends to get bigger after the market matures. And as a result, I think my focus would be on building, to your theme, building that community, demonstrating value, and then, eventually, I think you're going to be able to use Block Chain, Crypto currencies, tokenization, crypto economics to power your business. But figure out a way to actually execute today and prove value; that's what I would do. >> Again, all great stuff, great analysis, Dave, Good to see you here, where again: this is theCUBE's coverage in Toronto for Block Chain Futurist Conference. Again, this is part of our 2018 initiating coverage of the Block Chain Industry with our video presence. Engaging the community is an upstream content project sharing the data with you, so you can make your decisions, and understand who to connect with. That's our model, we're going to do it. We've been covering BitCoin and Block Chain since 2011, on siliconangle.com, that's our journalism site. Go to theCUBE.net, that's where we have all the videos, and soon to be our CUBE token coming out, be part of our network. Join our community if you wannna get engaged, we're happy to have you. Thanks for watching Day 1 of the Futurist Conference here in Toronto, Ontario. Thanks for watching.

>> Live from Toronto, Canada, it's the theCUBE, covering Global Cloud and Blockchain Summit 2018. Brought to you by theCUBE. >> Hey, everyone. Welcome back to CUBE's coverage in Toronto for the Global Cloud and Blockchain Summit, part of the big event also happening for two days, Wednesday and Thursday, the Blockchain Futurist Conference, here in Canada. I'm John Furrier, Dave Vellante here. Next guest is the founder and CEO of DigitalBits.io as well as Fusechain and serial entrepreneur and also the mastermind behind this inaugural event. First time a cloud blockchain conference has come together, bringing the two communities together. Al, great to see you. Thanks for coming on. >> Thank you for having me. Thank you for coming to Toronto, Canada. >> It's our pleasure. Certainly as you know, we love cloud. We cover all the big cloud shows. We're dominating that market in terms of coverage and access. And we just started covering blockchain in 2018 with theCUBE, although on SiliconANGLE since 2011 with the written word in journalism. But this is interesting. You are the brainchild behind this event, and I want you to explain why you came up with this event idea because this is the first time that you got two worlds coming together. You're bringing in the cloud DNA, and that can go back to like, classic networking and think big hosting providers, the Exodus and the Equinox of the world. These guys are the same guys who built YouTube's back end and Facebook. Large scale network guys with this new emerging blockchain world because there's some connections points, and it's super important, and no one's ever done that before. What's the motivation behind a cloud and blockchain summit? >> Well, if you think of the internet, all that data, all that traffic, substantial majority of it is flowing through data centers, infrastructure providers globally. And within many of those data centers you have cloud providers, whether it's cloud computing, SaaS, Software as a Service, cloud providers, you name it. And now we have upon us this emerging blockchain technology. Many are referring to it as Web3.0. And I'm obviously a big believer in that this is the next evolution of the internet. We got Internet1.0 in the 90's. We had Web2.0 with social sharing economy and so forth, and along the way, each step you had your first movers, your willing followers, and then the unwilling followed. It's been that powerful the last two occurrences that we saw with the evolution of the internet. Web3.0 is that next thing. First movers, willing followers, the unwilling. Every time you have this something very innovative, obviously there's a big engineering initially starts amongst, you know, a community of engineers, and then it starts to go mainstream. Obviously a lot happens in between conception and going mainstream. And if we look at the 90's, Linux played a substantial role in the acceleration of innovation. It really extracted, you know, it took a different approach to software, really leading open-source. >> It took down some proprietary incumbents - Unix. >> Absolutely, absolutely. And free and open-source software, but it still needed to be supported. Which version of Linux should enterprises embrace? And at that time, it was very important with what we saw emerge with things like Intel, IBM, Dell, HP, and so forth getting behind organizations like Red Hat and their version of Linux, now known as Red Hat Enterprise Linux. >> IBM put in a billion dollars into it. >> Yeah, exactly. >> Steve Woz, yeah. >> So with regard to that, you know, it was all about the hardware validating, right? These trusted vendors to the enterprise. And them kind of validating a company, or endorsing a company, in effect, like Red Hat, really helped provide a guiding light to the enterprise. Now it's not about hardware, it's about the cloud, right? Cloud computing providers and so forth. And in that ecosystem, it's not just AWS. It's not just Microsoft. There are many data center providers that have built a cloud computing offering that are supporting substantial financial institutions, substantial organizations within healthcare space insurance, and many, many other industries. So they play a very important role in supporting an enterprise, whether implementation, integration, and consumption of technologies, including new and emerging technologies. And so as we have, sort of, before us, this emergence of blockchain, obviously having lived in the cloud and infrastructure community for a number of years with that last company I had founded, know a lot of the key stakeholders. And even though I'm all in on blockchain, you know, I pop in every now and then in that world. What I found was two different extremes. You have CTO's and even CEO's of cloud computing organizations, and others within those organizations, totally high "Get It" factor. And you had the other extreme, multi-billion dollar cloud computing organizations, you know, data center organizations, where again, the leadership is still trying to figure it out, in some respects, not fully paying attention yet. And I saw that this is definitely emerging. Again, you'll have first movers, willing followers, and the unwilling. They're all going to get there. But it hadn't gotten there yet. And so with regards to this event, I saw a huge opportunity to really put something out there, allow it to ultimately take a life of it's own. There's a new organizer that's going to be coming forward and driving the ship with this event. But ultimately, there needed to be a forum, not just here in North America, but in every corner of the world, the Global Cloud and Blockchain Summit, providing this opportunity for that convergence, and for both communities to really share knowledge and accelerate, fill that gap. And I saw it's there. It is there. There's amazing things being spoken on stage as we sort of are sitting here, with leading innovators, and so forth, from both sides. There was an amazing keynote today by Anthony Di Iorio, one of the co-founders of Ethereum and founder and CEO of Decentral and Jaxx, really helping support the event today and making a contribution. His talk was phenomenal. That's kind of the thought behind it, and it's, you know, here we are. >> I want to pick up on something you said, for our audience, you know. I mean, for guys like you, Al, that are deep into it, you understand this very well. But you talked about Linux, and how, essentially, the Web was built on Linux. So if you were a Linux developer back in the day, and you wanted to "invest" in Linux, you didn't have a vehicle to do that. You could put your time in, you know? You could maybe join a company and maybe get some stock. But there was no way to directly invest in Linux. Well today, there is. With blockchain and cryptoeconomics, you actually can, whether it's tokenize your business or participate, you can buy tokens. And so it's a whole different incentive structure. And many in our audience are sort of new to this, kind of the unwilling, if you will. >> Yeah. >> And that's an amazing new way to create capital structures. >> And very powerful. I mean, prior to this tokenized revolution we're seeing here, it was a cool open-source project that as an engineer you wanted to be part of this, contribute your time, and quite often you would ask your employer to permit you to have 10%, 20% of your time to commit to these projects. Maybe you would even ask for that in your job interview. And you'd maybe get the thumbs up, you know? And so, your employer's, in effect, subsidizing your time to really contribute to projects and code that you're very passionate about. But if they got busy, economic cycles and what have you, and it's like, "You know what? We need you at 100% focus on your day job." All of a sudden, that community, that open-source community is losing perhaps a very valuable contributor, right? And there's really no way for that direct incentive from that project. And that's really what that is now. Projects can be created. You think of, you know, some blockchain's like an operating system, you now have an, you know, to use the Linux comparison, now let's say an operating system can have it's own incentive, a reward or compensation structure to really help attract engineers and other valuable contributors to not just give birth to a project, but help make it sustainable. >> Yeah. >> And, you know, eventually maybe you're quitting the day job because it's able to be free, open-source, and providing an enlightening self-interest. >> I'm getting some messages here, direct messages, listening to you talk. So I want to share them with you. One guy says, "Hey, Al. What's the deal with the different blockchains? How do I tell?" So I'm not an unwilling. I'm a wanna-believe. I'm not the front-end, but what do I pay attention to? And there's so many different chains. You got people promoting certain things. I don't know whose stats are real. You got two kids in a garage, >> Yeah. >> who just did an ICS. So the question is essentially what's the difference between all these chains? What do I have to look for? Is it latency? Who's solving these problems? What's the big deal, and how do I determine better chain from another chain? Are they all going to work together? >> Yeah. >> What's your thoughts? >> Things are moving incredibly fast right now. And it is difficult to keep up to speed. You know, maybe it was just bitcoin at one time and one chain to focus on. Then there was Ethereum and all these others. Now there's many, many more. So ultimately, it is about information, staying current with that information, doing your due diligence. But you really need to have a community that you're a part of, that you can, kind of, share in your evaluation and monitoring of what's new and emerging. >> So community's important. >> Very important, very important. Just say trusted advisors, trusted peers, and you kind of take a collective approach at this. Nonetheless, we're in this pioneering era, mass innovation happening. What's winning today, you know, may not necessarily be continuing to win tomorrow. But you really need to maintain a discipline, and take a peer approach to staying current. In terms of public chain, private chain, they're all going to play a role, and they are playing a role, in different use cases. There's clearly a use case for private chain within enterprise, within say, you know, trusted circle of supply chain participants. Maybe you want to bring some efficiencies to all that. >> So use case drives the chain. >> Yeah, absolutely. But public chain is a phenomenal phenomenon. Among other things that we hear a lot about it, it's given birth to the ICO. The new way of capital formation that is unbelievably awesome. The world has never seen anything like this, where. >> Explain that. Capital formation dynamic that you're referring to. >> Yeah, so the traditional way, whether it's in Silicon Valley or any other part of the world, you have an entrepreneur that maybe they haven't had a big exit where they can fund their own next venture on their own. You know. Smart intelligent people with a brilliant idea, and they're doing that friends and family route, right? The due diligence checklist isn't that long. It's like, you know what? Love my son. He's the smartest kid on the planet. You know, you give him a few dollars and a few other friends and family, this new emerging entrepreneur. And if there's evolution there, things are picking up traction and so forth, then maybe you're doing an angel round. And there's this sort of structured process that history's sort of define for us. And then from an angel round, you know, you have this early stage company emerging, and new milestones being reached, and then maybe there's a Series A venture capital round, and what have you. And then you have the, you know, the Series A, Series B, and so forth, right? The typical approach to things. A very regimented Silicon Valley has been a dominating force of the venture capital community, and that form of competition >> But the dynamics are different than the venture capital. >> Yeah, so that's the way that we've always, sort of, known, right? Many early stage companies, the process they go through. Many, many meetings behind closed doors, and so forth. >> Cloak and dagger, black box. >> Yeah, so concept of crowdsourcing, still beholden to the financial systems that're up there. How do you really foster community up there? And raise maybe a few million dollars? >> So what you're saying is is that it's easier to raise money now? Easier? >> It absolutely is. You have this new meeting of exchange where you have cryptocurrencies like Ether. And you're basically sharing your idea with the world, and all of a sudden, saying, "Hey, here's our token economics. We'd like to reach some capital." And then whether it's minutes, hours, or even weeks, you have capital coming to you from different corners of the world, and it's coming to you in seconds. Highly efficient. You have these universal currencies now emerging, and it's an amazing sensation, and it's a new form of capital formation, and with capital formation, you have innovation. So I believe that, you know, we're just going to continue to see an acceleration of innovation, globally happening, and not just in certain pockets of the world now, in many, many corners of the world. I mean what's happening in Asia's absolutely phenomenal in the blockchain space as well. It's not just interesting here in North America. In fact, in some respects even more interesting, depending on how you look at it. >> Describe what's happening in Asia. You guys talked about this last night in the fireside chat. >> Well, I mean some of the publicly available information is that you can just simply see, on many of the cryptocurrency exchanges out there, an insane amount of volume, more so than in any other corner of the world. And so you have a very active investor community up there, a trading community, token-buyer community, what have you. >> And where are the pockets? >> Very healthy. >> So it was China, and then things sort of shifted to Japan. >> Well, >> Where do you see the action? >> maybe where the centralized exchange in happening, but I think it's still a lot of the same people. It's not like it got shut down in a country, and those people just lost their desire. They just found an alternative means to continue to participate. >> Right. >> You know, South Korea, it's phenomenal. You have Hong Kong. You have Japan. You have Singapore, among many of the pockets. But then it's everywhere. I mean, you're meeting people from Vietnam, Thailand, India. They're all very active investor communities and utility token buyer communities. And it's very healthy. Yes, you have, you know, a correction every now and then in this market. But you have that with any sort of new, exciting innovation. But it continues to thrive up there. It's phenomenal. >> Yeah, you're seeing one of the main uses of bitcoin to buy alternative currencies. >> Yep. >> That's sucking huge amounts of volume. >> It's an easier currency. I mean, in a matter of seconds or minutes, you can have a currency go from a bedroom in Florida, you know, here in Toronto, to a project in Singapore, or vice versa, without going through bank. >> So again some more couple questions from the crowd. If you want to reach us, tweet us, either direct message or tweet @Furrier @DVellante. Happy to take your questions for the guest. But one says, "Do we buy now?" >> (laughs) >> Second was, "Do this side step the tariffs of the China, Japan, U.S. thing?" Obviously outside of the United States, we're the world power in the United States. But now that power is shifting. You see China and here in Canada, a lot of crypto-DNA here. So interesting. Your thoughts on buying? (chuckles) On the dip? Or crash? Or however you look at it? And then the international dynamic with China and Japan and others? >> So many are seeing it as a dip. I mean, the reality is, if this is new form of capital formation, it does share similar characteristics, nonetheless still to traditional or early-stage investing and venture capital, in many respects. Not every start-up succeeds. In fact, you know, over 90% traditionally don't make it. Even if they make it to a Series A round, they may not make it to a B round, right? And so, the fact that you have, some people kind of are referring to the Wild Wild West. I don't necessarily see it that way. It's just finding it's way, right? And it's going to get to a mature state. >> Well I think people look at the bubble, and they think Wild Wild West, but the interesting thing about it, you know, we talked about it off camera last night, around international is, and no one really knows what the STEEMs will be. This is going to be a completely different landscape than anything we've seen before, whether it's standards or execution. And I hear the argument all the time of "Oh, it's unregulated!" It's really the United States that's taking a more regulatory approach, you know, the SEC is essentially scaring straight everybody and saying, >> Well they're trying to figure it out. >> Well they're trying to figure it out, but also they've kind of slows things down, the process. But that being said, it might not have to be formally regulated. Because you mentioned Linux. The role of self-governing communities is a very interesting dynamic. No one's actually said and analyzed what a regulatory regime, globally, would look like, if you factor in, kind of, the open source concepts, with self governance because communities are very efficient, and we got money involved. >> Yeah. >> It can be even more efficient. That's called a marketplace. >> You know, people have disposable income, and they decide what they want to do with that disposable income. You go to a restaurant, you go buy some groceries, you invest, you maybe buy some commodities, right? And where we put that money, the value we had that we wish we could exchange for something else, some of it goes into some regulatory worlds and some doesn't. I want to go buy some you commodities at the grocery store. I mean, it's a free and open transaction. There's no KYC or AML per se and that happens. >> But food has to get to the supermart. My point is. >> Marketplaces don't require regulation. >> Exactly my point. That's my point. >> Or additional red tape, right? But where we put other capital deaths. So whether you're buying share certificate, early stage investing. There's SEC filings, perhaps. >> Who regulated Linux? >> Who regulated Linux? I mean-- >> (laughs) >> It was self governing. >> Benevolent dictatorship with Torvalds. >> But the capital formation was different in the Linux industry. >> Yeah. >> It was the more traditional path that you just described, and so those were-- >> But I guess what I'm saying is that, you know, have a token. Some token could represent a commodity. Some token could represent a security. So there needs to be that distinction and a framework of clarity so that we understand what needs to be regulated and going on that path. And so I think that's, kind of, part of finding it's way over the past 12 months or so is this distinction. Some countries were very quick to say, "Here's a framework.", like Switzerland. That clarity here is taking some time here in Canada and the U.S. >> Yeah, and I think they should let things foster and incubate a bit because you don't know the gestation period of real technology, and I think I'm cool with community-oriented governance Because people will lose a boatload of case; some will gain. But that'll all sort itself out. And with good community involvement, it'll happen faster. I just find that a better path. I mean, some people can't stay with that tension. They overreact. Some people can't handle the risk. But you got to see how it plays out at some level. >> You definitely do. But there's also an opportunity for self-governance. You know, you have-- There's the regional internet registries, right? So you have ARIN RIPE in Europe and so forth. You know, if you want an IP address and so forth, there's a self-governing body that defines policy and how these things are going to be deseminated here in North America. The government, kind of, sets off with that. >> The DNS system. >> You know, absolutely. This is valuable-- >> Yeah. You know, you have national security with internet, but how IP's are deseminated, it's self-regulated. So at the end of the day, if the community doesn't decide to say, "Hey, some of these things, well let's define self-governing bodies." And if they can play a great role in it all, fanastic. Otherwise, then maybe the government steps in" If that's the type of country it is where they like to engage. >> Al, everyone's reimagining new opportunities with blockchain and crypto. You've certainly got good venture with DigitalBits. We'll certainly have a conversation later here this week about that. I know you got to get back for a panel that you're going to go on now. So thanks for coming on. And congratulations on the inaugural Global Cloud and Blockchain Summit. Looking forward to talking more about it. So theCUBE live in Toronto for coverage of the Global Blockchain event here with cloud. And then tomorrow kicks off the big show here, the Blockchain Futurist, about 2,000 attendees. That's really going to be connecting the dots of the future. TheCube will be there as well. Stay with us for more live coverage after this break.

>> Live from Toronto, Canada, it's theCUBE, covering Global Cloud and Block Chain Summit 2018. Brought to you by theCUBE. >> Hello everyone, welcome back to theCUBE live coverage in Toronto for the Block Chain-Cloud Convergence Show. This is the Global Cloud Block Chain Summit part of the Futurist Event that's going on the next two days after this. Our next guest is Kesem Frank, AION co-founder and CEO of MavenNet. Doing a lot of work in the enterprise and also block chain space around the infrastructure, making it really interoperable. Of course, Jenna Pilgrim, co-founder and COO of a new opportunity called Network Effects. Welcome to the cube, thanks for joining us. >> Thanks, thanks for having us. >> Thanks, John. >> You guys were just on a panel, The Real World Applications of Block Chain. IBM was on it, which, been doing a lot of work there. This is real world, low hanging fruit, block chain, everyone's pretty excited about. A lot of people get it, and some don't. Some are learning. So you've got the believers, the I want to believe, and then the nonbelievers. Let's talk about the I want to believe and the believers in block chain. Some real world applications going on. As it's evolving, so there's evolution of the standards, technology, but people are putting it to use. What's going on in the sector around some of the real world cases you guys talked about? >> I think we're seeing a lot of collaboration as far as real world applications go, because I think people are sort of starting to understand that if a distributed network is going to work or is going to be secure, it needs diversity and it needs mass scale. If lots of different parties can work together, then they can actually form a community that's really working. As far as real world applications, there's some really interesting one as far as supply chain. Kathryn Harrison at IBM talked about their pilot about shipping, bringing together the global supply chain of distribution. There's a bunch of interesting ones about food providence and bringing together different parties just to make sure that people know what they're eating and that they are able to keep themselves safe, so I think those are two definitely interesting ones. >> Kesem, block chain, supply chain, value chains, these are kind of key words that mean something together. >> Right. >> Making things work in a new way, making things more efficient, seems to be a trend. You're kind of in that world. Is it efficient? (laughing) How's the tech working? What are some of the core threshold issues that people have to get over? >> So you know, John, that's exactly the question to ask. A lot of folks out there are looking at block chain and the promise it represents, and the one big question that keeps echoing over and over is when is this going mainstream? When are we going to see something, a domain, a use case, that is actually natively on a block chain? I think that, essentially, we kind of owe it to ourselves and to everyone that cares about this stuff to ask what's working today, August 2018 and what is still kind of pending? I co-founded a project called AION. For us, interoperability is really one of the key facets that you need to be able to solve for to make block chains real. And again, here's the 60 second argument. If you're going to grow all these solutions that are centric around the use case, they solve for different pinpoints and different stakeholders care about them. They don't really create the cohesive kind of ecosystem until they can all talk to each other, and then you have to ask yourself is the original hypothesis where it's going to be one main net, one chain that's going to rule them all, and everybody gets to play on it and everybody deploys their Dapps on stuff like Fabric or R3 or Ethereum, or whatever it might be. That is absolutely not the way we're seeing enterprise actually shaping into this domain of block chain. What we're seeing is big consortiums that already have value, tangible today, out of doing stuff on chain, and the biggest thing to solve is how do I take, to Jenna's point around supply chain or food providence, whatever it is, how do I actually open it so I can now start writing insurance events, payment events, banking, underwriting, auditing, regulation? There's this gigantic ecosystem that needs to be enabled, and again we are actively saying it's not going to be by an organic model where you and I do everything on top of a single solution. There will be a multitude of solutions, and what we need to solve for is how do we convert them from disparate islands that don't talk to each other into a cohesive ecosystem? >> This is a great point. We were talking on our intro, and we talked last night on our panel, about standards. If you look at all the major inflection points where wealth was created and value was created around innovation and entrepreneurship and industry inflection points, there's always some sort of standard thing that happened. >> Right. >> Whether it's the OSI model during the early days of the internet to certain protocols that made things happen with the internet. Here, it's interesting because if you have one chain and rule the world, it's got to be up and running. >> Yeah. >> It's not. There's no one thing yet, so I see that trend the cloud has, private cloud, public cloud, but public cloud was first but people had data centers. >> Right. >> Both not compatible, now the trend is multi-cloud. You can almost connect the dots of saying multi-chain >> Right. >> Might be a big trend. >> Right. >> This is kind of what you're teasing out here. >> That's exactly what we're about, and I think it's very interesting, the point you're making about dissimilarities between the two domains. We are in a cloud convention, and to me it means two things. One, we absolutely see the mainstream people, the mainstream players in industry, starting to take this seriously. It used to be a completely disparate world where you guys are a bunch of crazies with your Bitcoin and ether and what not. They're definitely taking this seriously now. The second thing, when you think of cloud as a model, how cloud evolved, we used to have these conversations around are you crazy, you're telling me that my data is not going to be on premise? >> It's not secure, now it's the most secure. >> Oh my God! It's in the cloud, what's a cloud? (laughing) You think of the progression model that was applicable back then, right? 10 years, 15 years back, where we started privately and we tell them OK, we'll take this side step of hybrid and then fully public. Took them a while, took them almost 20 years to get their heads around it. >> There's no one trajectory. What's interesting about block chain and crypto with token economics, there's no one trend you can map an analog to, you can't say this is going to be like this trend of the past. It's almost developing it's own kind of trajectory. A lot of organic community involvement. Different tech involvement. >> Totally. >> Different engineering mindsets coming together. You're seeing an engineering-led culture big time going on. That's propelling it up to the conversations of let's lay down the pipes, let's start running apps, but I'll do it within a two year window (laughing). >> I think the big thing to understand about that is yes, you need a whole host of developer talent to build distributed systems, but at the end of the day those systems still have to be used by people. They still have to be used by society, you still have to understand how to talk to your chief executives about what's happening within your company or what your tech teams are doing. There's a growing need for marketers, for PR people, for people who speak, I don't want to say plain English, but people who understand how-- >> Translate it to the real world. >> Yeah, they need to translate it, and how to bridge the gap between legacy systems and how do you take what you were doing before and transform it to a distributed ledger system? How do you do that without just paving the cow path? >> It's interesting, it's almost intoxicating, 'cause you got two elements that get people excited. You got the token economics, which gets people to go, "Whoa," the economics and the liquidity of money and/or value creation capture equations completely changing some of the business model stuff, which could be translated to software and Dapps and software general stuff or SaaS, et cetera. Then you got the plumbing or the networking side of it where things like latency, interoperability, absolutely matter, so with all that going on in real time, it's kind of happening at 30,000 feet and trying to change the airplane engine out. People are failing, and so there's some false promises, there's also false hopes that have not been achieved, so this clouds up the real big picture which is this is an innovative environment. We're seeing that trend. But when you get to the end of the day, what are people working on, to me, is the tell sign. Kesem, what's your project, talk about AION and the work you're doing, specifically give some examples of some of the things that you're doing in the trenches. >> Sure. >> What are you trying to solve, what are some examples you're running into and how does that relate to how things might evolve going forward? >> Sure, so there is a multitude of different problems that we work on but if you want to stick just to the fundamentals? Let's take one gigantic issue that everyone's kind of tackling from different perspectives, let's talk about scale. Scale is, especially in block chains especially challenging just because of how the technology works. How decentralized can you get before you're faced with gigantic latencies and before transaction cost are kind of through the roof? When you think about it, that is all a result of how we kind of contemplate these early stage networks. It was always the one network that is going to scale to infinity. Absolutely not the way it's going to work out. So from my perspective, again, sticking to this one issue, if you could actually give me a decentralized rail that maintains consensus throughout two networks, I can now actually have two trusted kind of go-tos instead of always putting the full brunt of the throughput on one single network. For us, that's kind of a no brainer application to interoperability. If you could actually give me all these trusted networks that work in tandem, I could now start splicing throughputs across many different parallel kind of rails. Not to similar than how we can solve for super computing. We understood there is a limit on how fast can a single CPU go and we started going wide. >> That's an interesting point, I want to just double click on that for a second because if you think about it, why would I have multiple rails and multiple systems? Maybe the use cases are different for them. >> Correct. >> You don't want to have to pick one cloud or one chain to rule them all because it's not optimized. We saw that with monolithic systems and cloud is all about levels of granularity and micro service and micro everything, right? >> Correct. >> And I would also say that gets into a security issue as well, right? You're talking about multiple layers but you also will have multiple layers of permission. You'll have multiple layers of how much information someone can see and what I think is emerging, if data is the new oil, then what's emerging is for the first time we're now able to trust data that we do not own. For corporations who say, "I don't know to market to you "if I don't know everything about you." But at the end of the day, they want to be able to leverage your data but they don't need to secure it and I think that cybersecurity issue is a huge, huge thing that's definitely coming. >> I want to get both of your thoughts on this, because we were talking about this last night. We were riffing on the notion that with cloud compute and data really drove scale. So Amazon is a great example and their value now is things like Kinesis and Aurora, some of their fastest growing services. You got SageMaker, probably will be announced at re:Invent coming up as the fastest growing service, right now it's Aurora. All data concepts. So the dataization really made cloud, great. >> True. >> Okay what's the analog for crypto and block chain? Tokenization is an interesting concept. There's almost an extension of cloud where you're saying, hey, with tokenization, the tokenization phase, how do you explain that to a common person? You say, is token going to be the token and the money aspect of and the economics the killer app? How's it transverse the infrastructures, plural? >> Yeah, or is the wallet going to be the browser? Or how are all of these things happening? >> How do you make sense of this? What's your reaction to that trend? >> So I actually get excited when I think about what token, on the most profound level, actually means. When you kind of think of where value happens in the context of these gigantic enterprises, right? You think of Apple, Amazon, Google, Facebook, any of them, and you kind of think of what the product is, it's all about the data and it's all about how do you convince people to give up data so they can monetize on it. And then you have two distinct, like literally gigantic groups of stakeholders at play. You have the users, that essentially get something free, right? I get to post on Facebook or I get to write an e-mail on Gmail. Then you have the stakeholders that actually extract all that value from my activities. A token, I think most profoundly represents, how do we actually get to a unified group where the user himself is the stakeholder that gets to extract the data? And again, the proposition is pretty straightforward. The more you use a network and the more the network becomes valuable and grows, the more value the token that drives at it. >> So it changes the value capture equation? >> Correct, different model altogether. >> The value creators get to capture the value and obviously network effects plays a big part in this? >> Yes. >> Which is your wheelhouse. (laughing) >> Yeah, definitely. I think it really comes down to core principles. Now you're able to really get down, to what Kesem was talking about, about when you're designing a token or if you're designing an incentive mechanism, you're really going down to the sort of deep game theory of why people do specific things and if we can financially incentivize people to do good rather than punish them or fine them for doing bad then we can actually create value for everyone. We're designing a new economy that now has the ability to propel itself in a fair and prosperous way, if done correctly, obviously that's the disclaimer afterwards, but. >> I love what you're saying there because if you look at collective intelligence a lot of the AI concepts came around from collective intelligence, predictive analytics, prescriptive analytics all came around using data to create value. I always talk about fake news because we have a cloud of media business that's kind of tokenized now but fake news it two things, it's payload, fake news, the fake content and then the infrastructure dynamics that they arbitraged, with network effects. They targeted specific people, fake payload, but the distribution was a network effect. Again, this was the perverse incentive that no one was monitoring, there was no- >> Well and I think in that case, yes there is news that is inherently false information but then there's also a whole spectrum of trueness, if you want to call it that so now we have this technology that allows us to overlay on top of that and say, "Well what is the providence of my information?" And with different layers of block chain systems you're actually able to prove the providence of your information without exposing the user's privacy and without exposing the whole supply chain of the media because there's like media buyers, go through all kinds of hands. >> And we believe the answer to fake news, frankly, is data access, collective intelligence and something like a block chain where you have incentive systems to filter out the fake news. >> Totally. >> Exactly. >> Reputation systems, these things are not new concepts. >> It's all about stake at the end of the day, right? It's how do you keep a stakeholder accountable for their action? You need backing so I think we're definitely on the same page. >> I love, I could talk about fake news all day because we think we can solve that with our CUBEcoin token coming out soon. I want to shift gears and talk about some of the examples we've seen with cloud. >> Sure. >> And try to map that to some navigation for people in how to get through the block chain token world. One of the key things about the cloud was something they called shadow IT. Shadow IT was people who said, hey, you know what? I could just put my credit card down and move this non core thing out in this cloud and prove to my boss, show them, not pitch 'em on the Power Point deck, to say look it, I just did this for that cost in this timeframe, and that started around 2009/2010 timeframe, the early digerati or the clouderati kind of did that but around 2012 it became, wow, this shadow IT is actually R and D practice. >> Mm-hmm. >> Right. >> You started to see that now, so the question that we see for people evaluating in the enterprise is how do you judge what's a good project? Certainly people are kicking the tires and doing a little bit, I won't call it shadow IT, but they're taking on some projects as you were talking about on the panel. How should they, the enterprises in general, the large companies, start thinking about how to enable a shadow IT-like dynamic and how should they evaluate the kind of projects? I think that's an area people just don't know what to look for. Your thoughts? >> I want to add a premise to that, because I think that's absolutely the right question to ask. We also need to add the why. Why should we, as people that do native crypto currency, even care about enterprises? A lot of people kind of theorized when Bitcoin was created to say it was anti institutional is an understatement, right? Aren't we meant to kill enterprise? The thing is, I don't think it's going to be a big bang. I don't think it's going be we wake up and nobody's using banking anymore or nobody's using the traditional healthcare or government and you know whatever insurance policies. We care about block chain in the context of enterprise because we think block chain is a fundamentally better model of doing things. It kind of does away with the black box where I need to be in business, I need to blindly trust you and it introduces a much more transparent and democratic model of doing things. We absolutely want to introduce and make block chain mainstream because that's important for us. When you think of how we do it, to your question, AION is all about interoperability, right? We create a solution that helps scale and helps different networks, decentralized networks, communicate to each other. What we also do with MavenNet, the company I run, is essentially make that enterprise friendly. It's extremely hard to do adoption and implementation within an enterprise, they're very immune to change. >> Antibodies as they say. >> Oh. >> The antibodies to innovation, they kill innovation. >> Totally, so going back to your original question, it all starts with a P and L. If somebody is going to authorize, you know, an actual production system in enterprise for block chain, it needs to create a tangible value, a tangible return, quickly and that's the key. The model that actually scales is you start by flushing out inefficiency plate. You show the enterprise how you could actually achieve, I don't know 20%/30%, that's the order of magnitude that they care about, efficiency by moving some part of your value chain on top of a block chain. >> It has to have an order of magnitude difference or so. I mean cloud was a great example, too, it changes the operating model. >> Yeah. >> They achieve what they wanted to achieve faster and more efficiently and operated it differently. >> Correct. >> And people were starting at it like a three headed monster like what is this thing, right? The cloud thing. And throwing all kinds of fud out there, but ultimately at the end of the day, it's a new operating model for the same thing that they're trying to do with the old stuff. >> Mm-hmm. >> I mean, it's almost that simple. >> Yeah, I think in some cases you need to really, in my previous life at the Block Chain Research Institute, we encouraged a lot of our clients to really take a step back and say, well will I actually, A, will I have this problem in eight years or seven years or 20 years or 50 years, if we're really fundamentally building a new financial system or a new way of doing things that is fundamentally different? Are we building it on old technology? We need to make sure that, and that's why you've seen banks were the first in the door to say, "Yeah, payments, that sounds great, that sounds great." But the real applications that we're seeing from banks are in loyalty, they're in AMLKYC, they're in the sort of fringe operations. Something like payments is going to take a really long time to push through because of those legacy systems because payments is the fundamentals of what banks do. >> This is an interesting point, I want to get your thoughts to end the segment because I think one of the things that we've certainly seen with cloud that over the generational shifts that have happened, the timeframe for innovation is getting shorter and shorter, so timeframe is critical so if the communities are fumbling around hitting that time to value, it seems to be trending to faster and we don't want to hear slower because these systems are inadequate, they're antiquated. >> Mm-hmm. >> These are the systems that are disrupted so the timing of, whether it's standards, or interoperability or business models, operating models, they got to be faster. >> Yeah. >> That's the table stakes. >> I think it all comes down to collaborative governance. >> People have to figure out block chain faster. >> Yeah. >> What's holding us back? Or what's accelerating us? What's the key for the community at large from the engineering community and the business community to make it go faster? Your thoughts? >> Right, so I think we're still searching for the next killer app. If Bitcoin is the reason we're all sitting here today and I profoundly believe that. >> Yeah. >> What is the next thing that drives change on a global scale? That's kind of what we're trying, collectively as an industry, to figure out. Sure, many kind of roadblocks on the way. Some of them educational, perceptional, regulation, technology, but the next big wave that's going to accelerate us to the next ten years of block chain is that next killer app. Organizations such as myself, Jenna, that's our day job, we wake up and that's what we do. >> I mean I've always said, and Dr. Wong, who's the founder of Alibaba Cloud agreed with me, I've been saying that the TCPIP protocol, that standard really enabled a lot of interoperability and created lots of diverse value up the stacks of the OSI model, Open Systems Interconnect, seven layer model, actually never got standardized. It's kind of stopped at TCPIP and that was good, everyone snapped at the line, that created massive value. >> But that's a collaborative governance thing. That's people coming together and saying that these are the standards that we wish to adhere to. >> We need the moment right now. >> Yeah, so you see organizations like the Enterprise Ethereum Alliance coming out with a prospective list of standards that they think the community should adhere here. You know you have the ERC20 standard, you have all these different organizations, the World Economic Forum is playing a role in that and the UN is playing a role, especially when it comes to identity and those kind of really big, societal issues but I think that it comes down to that everyone plays a role that I'm doing my best, I think it's going to be somewhere in the realm of data so that's where I've chosen to sort of make my course. >> I think this is a good conversation to have, and I think we could continue it. I mean, I read on Medium, everyone's reading these fat protocols, thin protocols but at the end of the day what does that matter if there's no like scale? >> Yeah. >> You can have all the fat protocols you want, more of a land grab I would say but there's certainly models but is that subordinate or is that the cart before the horse? This is the conversation I think is in the hallways. >> Totally agree, totally agreed. >> Guys, thanks so much for coming on theCUBE, really appreciate it. Breaking down real world applications of block chain we're at the Global Cloud and Block Chain Summit. It's an inaugural event and think it's going to be the kind of format we're going to see more of, cloud and block chain coming together. Collision course or is it going to come in nicely and land together and work together? We'll see, of course theCUBE's covering it. Thanks for watching. Stay with us for more all day coverage. Part of the Futurist Conference coming up the next two days. We're in Toronto, we'll be back with more after this short break. (theCUBE theme music)

>> Narrator: Live from San Juan, Puerto Rico. It's the CUBE, covering Blockchain Unbound. Brought to you by Blockchain Industries. (upbeat Spanish-style music) >> Hey, welcome back everyone. We're here in Puerto Rico for exclusive CUBE coverage, I'm John Furry, you're host. Here, with Blockchain Unbound, this is a global event. From everyone from Silicon Valley, New York, Miami, Russia, Eastern Europe, all over the world, and Puerto Rico coming together, talk about the future of the economy, Blockchain decentralized apps, and more. Our next guest is CUBE alumni, and part of our inaugural crypto currency coverage, from Polycon 18, back to give a command performance, Nithin Eapen Chief Investment Officer at Arcadia Crypto Ventures, good to see you. >> Good to see you too John. >> So, you had a great showing at our first crypto event, PolyCon, great to see you back in the trenches, you're out, hard-working, pounding the pavement, doing deals. What's your analysis here, I mean, you're here networking, you checked out the sessions. What's your take? >> We've met some really good founders, really good projects, so that's the key thing that we are looking for. The main idea as our tagline says, "We back Blockchain's best." We are looking for the best founders. We are looking for the teams, then for the idea. Anything that's decentralized, we are backing them. >> So, network effect has been a big part of the conference I've been having. We talked about security tokens, utility tokens. A lot of interesting things going on here, but there's a backdrop. You've got multiple events going on. You've have Blockchain Unbound, run by Blockchain Industries, great team, which put this event together in five weeks. So, shout out to those guys. >> (laughs) You have Coin Agenda, >> That's coming! going on, another event going next door, which is after this event. And then you have a lot of series of little events, meet-ups, the local community had a great crypto mixer, Puerto Rico, a lot of action. >> Too much action, and it's like at the same time, look at it, TokenFest in San Francisco, another 2,000 people over there, here people are on the waiting list, so much action. >> And that's going on this week, as well. You have anyone going to that event? >> I know, I've got a lot of friends going over there. For me, it made sense, this is closer. I thought I would meet a lot of them. Puerto Rico is better I found, you know? >> A lot of big money here, a lot of smart money. >> A lot of smart money, a lot of big money. >> John: Global? >> Global, and the greatest part of Puerto Rico is, it's bringing this concept like, they have reduced taxes for US people to zero percent for individuals, for the next, until 2036. Now that's a big difference. If you want to change your domicile to Puerto Rico, for your business it's 4% corporate taxes, and individual it's 0% now, that's... >> John: But you got to move here. >> You got to move here, okay. But you don't have to give up your US citizenship. Now, I think what's going to happen right now is they're going to be other states maybe going to compete for this, or other countries are going to compete for the capital to flow, where does capitol flow to? Capital will flow to cheaper places, or lesser taxes. >> So, I got to ask you, I was talking to you earlier this morning, here on the CUBE I said, "There's two killer apps, one of them is money." Money is the killer app. >> No doubt! >> Your reaction to that? >> It is, okay all of our lives, let's say for your son, or my kid, or for me, what my parents, when we went to school, why did they make us go to school or learn, they tell us, "Okay you got to go to college!" Why, they want us to have a better life, they want to have a better car. How do you get them, you want money for them. But in none of those years did somebody teach you, how does money originate? What is money, is it something you should buy the Garmin? So in everything that we go for, unless we're the Buddha or Jesus himself, we do it for money. >> Well you bring up a good point. I mean I have a immigrant background from my family, my wife's family as well. >> Where did you come from? >> Well I'm actually Native American, I mean American. >> Okay But two, three generations back they, Ireland, >> Ireland, okay! French Canadian, a little bit of Armenian in me but that's okay, all kind of blended. I'm in the melting pot, I'm not 1st generation but, in Boston where my parents were from, very much an immigrant town, and they didn't have any money. So if you look at now, what's gone through the financial dot-com bubble, which had some impact, but the financial crisis is 2018, if you look at what's happened since then, the generation of millennials there in more debt. They're not realizing college, it might not be the thing. So we went to school so that we can have a better life than our parents did. Now it's like everyone's realizing that, shit we're screwed. So watching as a path, of freedom. >> It is! A new way to create wealth, capture the value, but in a new way. >> Yes, because you have a chance to be a part of an economy without, a permission of a centralized organization. So, earlier if you wanted to work somewhere, you needed an organization to work. This is making it much easier to be a part of the economy. to contribute, to help people to get help, all this is happening and you don't have to go to school. Maybe school is overrated, our colleges overrated. It is too expensive, you spend 200 thousand dollars on college. What is your ROI, when is your ROI? Maybe some disciplines have it. But this is your chance to.. >> Well, you you know that we love media and our disruptive media at the CUBE is to do things differently, but lets talk about some current events that's been happening. So this week, John Oliver created a video trashing crypto currency, it was actually funny. But it got to the Brock Pierce part, and he really had it out for Brock Pierce. He absolutely destroyed him. >> He did! And since then, he lost his place EOS. They wiped away all his DNA of evidence with the company. This is a comedian, at John Oliver, you're a freaking comedian. What gives him the right to I have that kind of influence on someone's job when he's just telling a joke. There's no actually substance of any facts of any kind at what he's doing, So that's a central authority figure that took an editorial comedic routine, and put it out there, but people think that's news. >> See, >> That's not The power of media, that the power of all the old traditional media, is that they had a bigger reach. I think it's going to change, it is going to be the YouTube's. And it's going to become a decentralized YouTube equivalent, or a decentralized media equivalents. Like, a lot of people have made memes and you know, fun videos that go viral and they'll take things down. The same, John Oliver obviously, he has us laugh. >> He's funny as hell though. He is funny as hell! >> You got to admit, >> He's pretty funny! The bit was really good, >> But end of the day, but he really went after Brock Pierce. Something was going on there, he took him down. >> See the traditional industries or traditional media they want to take down everybody that they don't consider, the birds of a same feather, this is somebody weird, like Trump, they try to take down Trump. They will try to take down anything which doesn't fit their globalist, elitist agenda. End of the day, like Brock Pierce sitting on a billion, and John over with his comedy, who has the bigger laugh? I don't know, if you ask me. >> When you have F U money like Brock Pierce does, I'm sure it rolls off his shoulders. But it does impact the ecosystem a bit. Basically EOS has erased his name in any capacity. So, obviously this impacts to public opinion. So these comedians and news rep, they have an obligation to share the data. Editorializing, I mean I do it all the time, don't get me wrong. >> (laughs) But, there's a point, consensus is part of the algorithm now in these Blockchain and Crypto communities where you have Blockchain as a store, against him. >> Okay! But consensus and transparency is a huge deal. >> Nithin: Yes! >> This is part of the formula. >> I know but see, the whole thing... When John Oliver does something, it's not about consensus. He can do it, okay, it's going to change! It's like this, when Bitcoin came in 2009, the traditionalists were coming up at the story that, "it is fake money, it's not going to go anywhere." Then it became one dollar, they were just laughing at it. Then became 10 dollars, they said it's going to go down. Then it became hundred dollars, they did the same thing. And it's only after long time they will realize, "Oh my God, it's changed." The rock has been pulled under my leg. It's like when Amazon came, all the traditional retail guys said, "Nobody's going to go and buy a book without touching it." Now we have Toys "R" Us that just went bankrupt. There's no more Toys" R" Us, you know, you have to buy your toys pretty much from Amazon at this point. >> Well everything in the model of future will be all contexual so, videos, comedian, news articles, reports, editorial, all will roll into one thing. That's going to be a great thing. >> Yes! >> And media is going to take a lot of, natural language processing, it's going to get transcript link. I think you're already doing it right, you're going to take a transcript of what I speak, you're going to attach the words, you're going to attach it to brands, you can sell that, and that is going to be the future. >> Well lets get some of that intellectual property out of your head and into the camera, and for the audience. What are you hearing in the hallways here, obviously this is a great networking event here. Lot's of agendas, phenomenal, as well as we had over sold almost by double. There's people out in the hallways, it's sold out, so there's a lot of Lobby Con going on. There's a conference within the conference going on. >> Nithin: It is! We call it Lobby Con! >> (laughs) What are you hearing in the hallways, what is some of the cool things that's new to you, that you're discovering? >> So lot of people are now telling me they are very excited about security tokens. They're telling me they're buying security tokens. I asked them, which security tokens? It's not there yet, okay. See, that's where I tend to differ. If security tokens are going to be the big thing, I'm going to be buying it because we are informed. >> John: Buy everything that moves. >> We buy it as it moves, but, security token, my question is, so you're trying to make something that is a utility, now you're going to make it security? So that is equity markets, there is a CC for that. And you're going to fit this in over there, I'm like, I don't know, what are people trying achieve? This is a free market and they're trying to bring it into regulation. >> What's a red flag for you as a, security token implies directly that you're securing something. What are they, >> You're pretty much What are people securing, equity, future cash flows, dividends, what are some of the vehicles you've seen? >> At that time they are pretty much secure, or securing future cash flows as dividends. They're going to give dividends, they're saying if you're a token holder, you're going to get dividends. My question at that time is, then why do you want a token, why can't it be in equity? Oh, you think you can come with their argument that it's more liquid, but equity's a liquid. I don't think it isn't a liquid. But it is a great way to go around and secularize a lot of things. You can have a small business, think of it, you and me we have a small business, let's say we have a partnership We have a small... >> We have a small business, We have a small business, we have a partnership. It's very hard to exit out of a small business. If we can fractionalize the ownership of a business thru tokens, and there might be people are willing to buy, put thousand dollars in, and maybe I can exit at some point. Otherwise there's no exit for me. It's very hard to exit out of a small business. Now then, what's the difference between that and equity? I don't know you know, those lines are blurred but, I'm happy for the fact that something like that will give liquidity to a lot of small business owners. America is a country of small business owners. Across the globe it supports small business owners. If it brings liquidity, okay I'm happy with that. But it's really beating the purpose that we don't want a centralized power controlling us. Because now that you have Google and Facebook that banned crypto-currency ads. Why, Women's Day, all our data, they give us a free access but they hold a lot of our personal data. I'm thinking, the guy who brings in the, a decentralized search or a decentralized social media, I'm going to invest in them. I don't care if their a success or if the success will come later. There are going to be multiple libertarian investors like me that's going to invest in them. >> What I learned was that money is a killer app, and I'll stand by that. I think marketplaces are also the killer app. You ever think, >> Perfectly true! that this conference, that kind of validates where I was thinking was, the people who nailed a business model, that's the critical, critical pacing item. If you screw the business model up, you go sideways. The technology risk isn't as bad as the business model decision risk. So I'm seeing the successful ICOs, or plays, have a lock in on the structural value proposition and to be directionally correct, with an understanding of what the hedge is on the technology. >> Yep! >> So they can manage it. So it's like programmable plumbing. They're recognizing that dynamic. The other thing that I'm learning is that the money flow from other countries is massive. If you want a money launderer from Colombia, it's coming in from Metadine Narcos. It's coming in from Japan, and China. Bitcoin and Blockchain is a money transfer opportunity so, I'm seeing a massive amount of money, flowing in >> Capital is flowing, in massive waves. >> it's flowing in. >> And it's good, and even if these projects fail, it's a good thing because, you had all this money that was stuck somewhere, that flowed in, and as I said, many of those projects are going to fail. Let them fail, because this money has flowed in, you will have a lot of people come and work on these projects, and eventually the correct solution will emerge. >> And new structural dynamics are at play. And new investors are coming in. >> New investors, so many new investors. You know the funny thing John, after we met at Polycon, I think that 99% of the people I meet here are totally new. All the guys we met at Polycon in Bahamas, totally different. I only know very few people that I met over there. So that means a whole set of investors, or common people, who just want to learn about it, totally new. That's really good! And who wins here, the average citizen entrepreneur, the average citizen player that wants to start something whether it's a banking, a service provider of some sort, a entrepreneur, or a new financial instrument or firm, all have greenfield opportunity here. >> Because, see earlier when you wanted to raise money, I was talking to a founder the other day, I asked him, how hard it was for you to raise your first raise, like 10 years ago? He was telling me that he walked the doors across multiple VCs, to kind of scrap in one and a half million dollars. And then he did his second loan after eight years. >> He'd have to crawl on his knees to get that. >> And that too, you won't get the attention, you need to know reference, now you have a chance to go to the world, and monies were, so easy money coming in is a bad thing in a way that most entrepreneurs will feel the investors will lose their money. but that's different, but it at least you have access and you can try to think that you had any in mind earlier. You had no option, they would take a big stake. Now there's no dilution, this is pretty much cloud funding on steroids. You have a chance to go to market, you get the go to market money and see if it works. And if it doesn't work, let's fix it after that. >> Nithin, I got to get your thoughts on building a company, 'cause obviously, you're also not only in this as an investor, you're also doing strategic advisory work for people building the venture architecture and then the actual build up plans for their venture. So you've talked about this in the past, you have a relationship with some protocol guys, you can check with them, there's some good network there. But there's also a dynamic with this industry where the business development aspect of it is really important. People are partnering, >> Very very important. And there's a way to partner and a way not a partner. There's a way to do token economics and there's a way not to do token economics. What is your advice, to companies that have a good thing going on, they have a tail wind at their back, they got wind in their sails, but have to make some hot partnering decisions. Looking for fellows, fellowship in that ecosystem. How do you advise folks in this partnerships and then talk about token economics after? >> So the first thing I would tell founders is to reach out. This community is very very supportive. Like you can reach out to me, you can reach out to other guys, LinkedIn, Facebook, or come to these events, and in the hallways. Say your idea and you need help, because you will need help, you cannot run this alone. You are running a company, you are running your team. Have a good team, that's a first thing. Have a great team, great founders, vision, execution, you need that. The next key thing is, you have to think about marketing and how do you market, you need to get some big names on your board who can reach out to their network and tell them about your idea. And they reach out of the rest for you. >> So networks are super important. >> Super super important, like... >> So advisor, that their advisor selection should be based on their network that they bring to the table. >> Right, so the first advisor selection is the guy who will help you flush out your idea properly as tokens. The next advisor set is a marketing advisor or a technical advisor. The marketing advisers also very important because you need to market the product, get the money in, because end of the day, you need money to build it. You need to pay your employees, whether it's in Bitcoins or in fear, It doesn't matter, one of these is required. So you have these three things, then you need to build strategic partnerships in your business. Say, let's see your a loyalty points guy, like Al is doing, You know Al right? >> Al Burgio, >> From FuZe Chain now doing DigitalBits. Hot deal, hot deal! >> Hot deal, hot deal. >> Look at what Al did, he went out, he got his strategic partnerships with the loyalty guys, now he's got the brand, the strategic partnerships, he's built a product already. The money he needs is only for go to market so that he can push it to multiple companies and get them on the chain. Brilliant idea so, strategic partnerships, advisors, founding team, and then, show the idea to the people. Go out there, let them know that this is what you're doing, why this idea is great, how big is the market, there was a problem that you're solving, what is your solution. Explain yourself frankly and honestly, and I think the community will reward you, to go and find your dream. >> Great point, be honest, ask for help. Again, I can't reiterate my experience of, I'll share, is during the computer revolution, Internet revolution, Web.1.o, and now partnering in the early days when it's forming, can make or break a company. Make or break a company. >> Very True! So, note to that, okay now, token economics. >> Nithin: Sure! >> Sounds easy, but you really got to make sure that you have a good economic framework that matches the value proposition. Talk about what you advise there. >> So last day of the one founder restart to me, ICO is going on for our seventh day into the ICO. He's raised less than 300 thousand dollars. I meet him, and he needs help. After what, seven days into the ICO, all I could tell him is, shut off your ICO, it's not going to raise money. He's like, "Why," and I'm like, he said, "read this paper." I'm like, "There's nothing in this paper "I can put money into." And he's like, "Why is that?" So I asked him, so how many companies has he put his money into, how many points has he bought? Four years, he has not bought a single coin. And he's flustered something by himself. So he's never bought a coin, and he's expecting people to buy coins at his price. So I tell people, either you should notice, you should be an investor yourself. So there are different kinds of investors, there are institutional investors that are funds, family offices, and then are retail investors. If you're not any one of these, or any one of in this group, how do you know what these guys are buying it for? So reach out to them! >> That's where the advisory comes in, Know your customer! >> Know your customer! And not the KYC in a different way, but know 'em from a marketing standpoint. Know how the retail, >> Exactly! purchase is made. >> Because if... >> If you yourself are a buyer, at least you have some idea. If you've never bought a token, and if you're, I had another founder tell me that, my tokens are worth hundred million. I'm like, you don't have a user, you just have a product. You're tokens are worth shite, if you ask me. It's worth zero, I can tell my house is worth hundred million dollars. It's only worth as much as the top buyer. How much is he willing to pay for me? So I told the founder, I'll pay so much for this price because I think, if it's about that, there's a huge risk as the main investor coming in. He doesn't agree! >> So lets talk about some, how rounds are being done now. So one trend that I'm seeing, not, I shouldn't say trend, a few deals I've seen done, but it seems like a trend, I'm trying to get validation on this, Where people are avoiding the public ICO altogether, doing all privates. >> Yes! Basically over subscribed round. Trend, dynamic, real deal, what's your thoughts on reaction to that? >> It's just that the founders are adapting. Because if you go to the public, the moment you're going to the public, what's happening is, there's the SEZ component. Whether it's a utility and they can come after you, so they have made it private. And then they went after, and even further, a lot of the founders that I know, they just stopped accepting money from US entities or US individuals. Well it's a bad deal for a small investor. See the big investors are wealthy investors. They all have an external entity where they can invest into it. What about the small investor who was investing thousand dollars or 5,000 dollars? Now you have pretty much shut out his chance of getting into a great ICO. So the founder is going to raise his money from maybe Korea, Japan, China, and Singapore. He's going to form a company or a foundation in Cayman, or Lichtenstein, or Gibraltar. The small investor is a loser. The large institutional investor has no loss in this process, so, that is the founder adapting because he does not want, >> They want to manage, >> They don't want it to become lawsuits, basically. >> Compliance, audits, SEZ problems, they don't end fencing problems. >> So now let's compare, in contrast, different kind of companies. US based company, wants to raise money in the US, they do accredited. But they want to go outside, say Asia, or an Asia company wants to raise money in the US, what's that dynamic like, what are the issues? >> I think what's going to happen is they going to, some of them are going to register themselves as a security token, some of them are going to do just a reg D for very high net worth individuals. And the common, the the public round, they going to raise it from the China, the Korea, Japan, or is lobbying them. And that's what I think, multiple small countries are going to come into the space, which they know now, they can get the capital flowing into their company, and they going to allow their rules to be lax. They going to let capitol flow through. And then US will have to change, or maybe UK will have to change, whoever is against this will have to change. Capital means money, belt capital, and resource capital, like humans, we tend to move to places that are freer. Why did I move from India to US, or why did your parents or the earlier generation move to US? >> John: For a better life. >> It's a better life, the real better life is, you have the freedom over your property, the fruits of your labor. If the fruits of your labor are taxed at 50% or thirty, the more it goes up, you just don't want to work anymore, or you're going to to search for that place that will tax you less. >> Like Puerto Rico! >> Nithan: Puerto Rico! >> Are you bullish on Puerto Rico? >> I am bullish on Puerto Rico because, these, if they can sustain this, and have the rule of law, means they can protect people's wealth, like from crime and all those things, crime or being kidnapped. These two things happen, I'm telling you, most people will move or some of state will have to change their laws. >> They got to get >> the security up. Nithan, thanks so much for coming on the CUBE. Really appreciate your insight. Thanks for sharing! >> Thank you very much. This is the CUBEs exclusive coverage from Puerto Rico where we're getting on the ground here. Getting all the data from the Blockchain Unbound Conference. Part of restart week. I'm John Furry here, we've got more coverage after this break, thanks for watching! (upbeat electronic music)

>> Narrator: Live from San Juan, Puerto Rico. It's "The Cube", covering Blockchain Unbound. Brought to you by Blockchain Industries. (Salsa style music) >> Hello everyone. Welcome back to "The Cube". This is our exclusive coverage in Puerto Rico for Blockchain Unbound. This is a conference where the local entrepreneurs, industry legends, financiers, funders, everyone's coming together from Blockchain cryptocurrency in the decentralized web. A lot of great use cases. We have the politicians as well here in Puerto Rico, kind of enticing the community to do more here. I'm John Furrier with "The Cube". I'm here with Luis Macias, who's is the CEO of Grain Chain, a start up out of Texas, doing very interesting things with Blockchain, and a really good example of really the value proposition of reducing steps it takes to get something done creating value, and then sharing that value. Luis, good to see you. Thanks for coming on. >> Thank you for inviting me. >> So we talked yesterday, here off camera, about what you're doing on, but I want you to take a minute to explain to the folks what you guys do, and why Blockchain? What's the difference? >> Sure. So, I would say about 5 years ago we got approached by a large scale farmer, and he asked us to find a solution to be able to modernize his business, you know. As we all know, the farming industry is not as technical as a lot of the other industries, so we went out and searched and we just couldn't find a solution. So we built the appropriate solution to take a seed from the ground and take it all the way to the commodities market in an instant, instead of 3 to 4 weeks. So basically what we do is we join the buyer or the buyers of the actual soft commodities, and we allow them to create smart contracts with individual farmers. This ensures not only the payment to the farmer, but it allows the farmer to get paid instantly. What does it do really for our overall industry? Our buyers gain instant custody of the actual grain the second it crosses the scale. That changes everybody's life dramatically. >> So the middle man gets kind of disrupted, but before we go in that, I want to kind of dig, >> Sure >> it's important because I'm from California. >> Okay >> It's a huge farming thing there, cultural thing going on there. What's your background? How did you get here? I mean, how long have you been doing it? >> Sure. >> And when did you jump on the Blockchain as an opportunity? >> So we've been developing software for the last 17 years. We've done it for the insurance industry and for state governments, and we are in Texas and we a have personal relationships with many farmers. We saw a problem and we needed to solve it. In the last year, we went ahead and started applying the Blockchain to the process. And the Blockchain is a perfect form. When you have two parties who really, really don't need to trust each other, and need to trust each other with a distributed ledger, you've got a perfect scenario. If we're about to write a contract and a thousand people be able to verify that contract, and we're able to transfer money from one person to another without the two parties being involved, we've got a perfect scenario. >> Yeah. That's awesome. >> And that's where Blockchain really, really effects the agricultural industry and our farmers. >> You know I said on "The Cube" this morning, we were talking about it last night with some folks, the killer app for Blockchain is money. >> Yes. >> The common thread in all this is money. Just like the first computer in the TCPIP revolution, it was email. There's a 20 year killer app. We hate email now, but the point is you're in the money transaction business, but there's a supply chain involved. This is where it gets interesting. This is where I think you're onto something really nice here, because you are essentially creating a better contractual environment between buyer and seller, but the product still needs to move to the market. >> Yes. >> This is where you're innovating. Can you talk up, specifically, about how you're disrupting that piece? >> Sure. So, basically what we're able to do, is not only allow farmers to involve themselves in the forward and future's market, also the spot market within the actual system. So, it integrates with the actual trading applications, but it also integrates with their future's market and forward's market contractors. So, we're taking a group of people who are not very technical and we're giving them that ability to do what the big brokers do >> Yeah. >> In the overall industry. >> Just give an example, a run of the mill example use case. >> Sure, sure. One of our farmers who's got 5 million pounds of corn does a forward market with a buyer, the second he processes the scale, it will settle that contract instantly, and then it will actually notify him and say it is in your best interest to go ahead and close the other 3 million pounds because the price just spiked. He hits one button. He makes more money than he's ever made on any contract he has done in the past. >> And that's because what happens? What was the old way? What was the old way? >> The old way is he pretty much put it in the silo, and sent the papers to an accounting office. Three or four weeks later, he figured out how much he had, then he gave it to a broker to be able to look at the actual inventory. They put it up on the market, and they make the actual commission. >> They make the spread. >> Yeah. >> They increase, they mark it up. >> Exactly. >> They take the spread down, and they still got to send paperwork back to the guy and say "This is what we sold". >> Exactly, and then eventually get paid. This pretty much turns that entire process into an instant action. >> This is a game changer. This is basically taking all those steps, and a lot of potential miscues could happen in that process. >> Absolutely. >> Time wasted, errors. >> And there's, you know, I don't want to put any bad actors, but it also eliminates the bad actors out of the scenario. Our governing system actually integrates directly into the scales, gets signatures from the scientific reading instruments, so we're removing bad actors and we're removing errors, and we're speeding the process. >> You know, I have a computer science degree, and software background, like yourself, but also got an NBA from Babson College, one of the words they use in the NBA class is "value chain". >> Yeah. >> The "value chain". You know, the activities as part of creating value. Kind of a document thing, but the word Blockchain, value chain, really this is the perfect example of the kinds of use cases that we see in Blockchain. >> Absolutely. >> Moving a product to the market, reducing the steps it takes to do something, saving time, and being more efficient. >> And having a complete trust system. You know, when you have a farmer who's paying a 1% premium to be able to ensure to get paid, a 90% and there's still litigation in everything involved, this completely eliminates that scenario. >> Yeah. The other thing we talked about on "The Cube" this morning and yesterday, I was saying was that killer app's money, which is great, money has to move around. That's what we see activity on, and some bad actors there for sure, but marketplaces is also the other killer app. Do you agree? I mean, because you're essentially creating a marketplace. You need a marketplace. >> Absolutely. I actually just got approached about 10 minutes ago from a local Puerto Rican gentlemen who's restarting a farm after the weather event that happened here. He's trying to figure out how to get honey into the U.S. market, but is scared to sell it to just anyone. He asked me if it's possible to be able to set up smart contracts with all the random buyers that want to buy his honey. >> Yeah. >> This is an exact scenario where we are helping a community who has to start over and figure out who to sell their product to. >> You know Luis, this is a great example of, kind of, categorically what I'm seeing across the disruptions schemes out there, which is, in the cloud computing era, Amazon Web Services created a catalog of services that allowed you to use resources without having to build stuff up from scratch, provisioning servers. This is kind of happening here, where you're starting to see a sense of services or players, a catalog of services, >> Absolutely. >> happening in business. So essentially you're going to the next level. This seems to be a consistent pattern. What's your take? >> Yeah. Absolutely. It's allowing the smallest guys in the industry to the biggest guys in the industry to take advantage. When you have people using Amazon Web Services, you're having massive corporations and the one business man owner. What we're doing here is, we're giving the same opportunities for both classes of people to be able to scale, and put their product on the market without having to do a massive investment, >> Yeah. >> Or be scared that they're going to get robbed. >> It's a great value proposition. I'm sure you've got a lot of investors knocking on your door. Take us through what you're doing right now. You're doing an ICO? Are you raising money? And, what are you expansion plans? Because I know you're in Texas. Are you in California yet? I mean, a lot of agricultural activity there. >> So. >> What's your growth plan? >> So what we're doing is, we're doing a Token So Event, and we're doing a private placement sell to accredited investors. We're trying to respect all the SEC regulations out there. We're launching that at the end of this month. We are currently based in Texas and we also got approached by the Mexican Government to apply the technology to the state run silos in Mexico, so what we're looking for is really finding people who want to help us scale this product world-wide and being able to participate in our sale. If you're able to go onto our website, grainchain.io, and sign up to our white list, that'll allow you to get some information on how to participate. >> Grainchain.io >> That is correct. >> Like as in the grain of a seed. >> Absolutely. >> Okay, I'm going to ask you about Puerto Rico. >> Yes. >> You've been here a couple days. What's the vibe here? Why is this such an important event? A lot of people who are watching this aren't here. What's happening in Puerto Rico? What are you hearing in the hallways? What is some of your conversations? And, what are your observations? >> I mean, I think that the reality is that Puerto Rico is trying to embrace technology, and trying to embrace an industry that can support the people here. We've seen a lot of the devastation as we're driving around, but Puerto Rico is back up and running. So, the reality is that I feel very, very strongly about, not only supporting the local economy, but the fact that they're supporting real technology and providing and trying to get real solutions into this country to restart. >> And the young people are really engaged on Blockchain crypto. >> Absolutely. And you know, you'll have a lot of young very very aggressive developers. I've met a lot of people here, who've come here. A lot of locals who are looking for work in Blockchain and developers. So we're very excited to really really see that everything is kind of kicking back up here in Puerto Rico. >> Well, my final question for you, Luis, is as an industry participant and developer and player, what is this wave about? You know, you put your industry hat on and expert hat on, what is happening? I mean, what is really happening with Blockchain Crypto and decentralized applications? Because there is so much action, people want to get on this wave and surf this puppy. What's happening? In your personal opinion, what is this wave all about? >> I mean, I think that this is, again, not comparing to the dot com era, but it's giving the average person the ability to get into real industry. It's allowing everyone to be a participant, an investor, a developer, an overall embraceor of the technology that you haven't seen in a long time. Usually the software development and putting out products takes a lot of technical skill, and this is really kind of encouraged everyone to embrace it, look at it, and allows everyone to participate. >> And so basically the democratization of society. >> Absolutely, but it's also the democratization of a world economy, not a local economy. >> And the locals can play and customize it for their own personal needs. >> Absolutely. >> Well Puerto Rico's got a great opportunity on the loose. Thank you so much for coming on. CEO of grainchain.io, I'm John Furrier at the Blockchain Unbound Conference. Day 1 of 2 days of coverage. We're talking to all the experts, entrepreneurs, thought leaders, investors. More live coverage after this short break. (logo music)