#261 Web3, NFTs, and DeFi: An In-depth Discussion with Nadja Bester

0:00:02 - Mehmet
Hello and welcome back to a new episode of the City of CTO Show with Mehmet. Today, I'm very pleased to have with me Nadja, joining me from South Africa today. She travels a lot, nadia, the way I love to do it is I keep it to my guests to introduce themselves, for a simple reason no one can introduce someone else better than themselves. So the floor is yours. 

0:00:22 - Nadja
So now I'm under a lot of pressure to introduce myself in exactly the right way. I think what I would probably start off by saying since this is not a show that is specific to the industry that I'm in, which is blockchain, slash, crypto, slash, web three I will keep it high level in the sense I have a background in. So I started my career in psychology, moved over into marketing At that time, about 10 years ago, it was called digital marketing. Now marketing is inherently digital and then, from the marketing industry, worked in the pharma industry. I also had a stint in education, so I'm giving you this background just to kind of illustrate that I've been or participated in a number of different industries and then finally found myself, come 2017, working as a journalist in the blockchain industry. The reason I took that on is not because I understood what it was about or because I even particularly cared, because I absolutely knew nothing about it. I had taken a work sabbatical and I was traveling the world with my son and I decided you know what, if an opportunity like this comes to kind of live out this childhood dream of being a working journalist, let me do it. But as I started researching the technology, literally as part of my job. Things just unfolded and I kept on really becoming more and more fascinated with the promises that this holds, and so this is the reason why I am still in the same industry. 

So what I do currently? I'm the co-founder of Adlunam. Adlunam is a Web3 investment ecosystem. So when we talk about Web3, it's one of those definitions that's really hard to pin down, because this technology and its peripheries really likes jogging, really likes these little terms that no one else does, like NFTs and DeFi and all of those things. So it's very difficult if you're not in the industry to fully understand what that means, and this is obviously something that we can talk a bit more about today. So we are a Web3 investment ecosystem. So essentially, what we do is we have a whole range of services support services that we offer to Web3 startups between the seed funding stage all the way up to the public sale. 

Now, a public sale is like the Web3 equivalent of an IPO, because it's very different, and this is what makes the crypto industry very different it's not regulated in the same way that the traditional financial services industry is. So, yeah, there's a lot to unpack here today. So I am the co-founder of Adlunam. I also am an advisor in the space. I've been working with startups actually for many years, predating Web3, but certainly in the Web3 industry I'm a speaker. I speak at a lot of different events Really believe that it's important for us as builders in the space to also build out the way that we think about it, both individually and collectively. And then I am also the executive producer of an upcoming Netflix documentary about the future of the internet and the evolution of digital self. So that's a massive mouthful and I'm going to stop there and exit gracefully, hoping that I've done justice introducing myself. 

0:04:05 - Mehmet
You did fantastic actually. Nadek, thank you very much for this introduction. Now, of course, as you mentioned, there's a lot of things to unload it, and the place I want to start from is actually, let's start from the Web3. And you mentioned something which I like. You said yeah, there's a lot of misconceptions sometimes. You know people, okay. They said, okay. The next cool thing, maybe one thing which caught my attention while you were introducing yourself, is you said like, you look at it from a journalist perspective. Now, one thing I know like journalists, usually they are very detailed oriented. Now, for you, what did you find? The most you know and we can go deep dive as much as you know, time would allow us, of course but what was you know? The moment when you were researching that you thought, okay, you know what, really, this is something big like what, really? What was the main cause that you thought, okay, really, I'm up to something important? 

0:05:15 - Nadja
So, yeah, that's a fantastic question. I think, in order to answer this, I just have to zoom out a little bit and say that, as much as I believe in this technology, because I believe in being really real about things I mean, if we're going to talk about any particular topic, but especially something that concerns society and all of these different institutions and institutional systems that we part of, and the future, of course, then it's incredibly important to really present things as they are, as opposed to how we would like them to be or how we think they should be. So, just, you know, disclaimer here even though that this technology has or holds immense promise for so many different industries, it does not necessarily mean that we are already seeing it in practice. So really important to note that, because I think you know, as humans I like to think of it this way. If you look at someone like Ted Bundy, the serial killer in the US, who was able to lure in his victims because he was charming, so people didn't know when encountering him that he was actually a mass murderer, or serial killer at least. And similarly you know John Gotti, the mobster, I mean, he was wanted by authorities for a really long time and yet the public loved him. So I think it's really important to understand that you know, any human individually and any collective of humans, we have the capacity to create incredible things and we have the capacity to create horrific things, and the power and you know, the power of choice really is always something that lies with us. So the technology that is created around us, these technologies are still subject to what we are going to use them for. So, with that out of the way and I think you know that was important probably to mention for anything else that I'm going to say as well, but specific to your question so I think, for me, when I realized, you know, I always say that I'm really lucky, but I say that, you know, with a bit of irony, because I think I grew up in the 90s and didn't really know much about what was actually going on in the world, if I compare this to my son, who was growing up in this decade, or he was born in 2006. 

So for him, he's been confronted with what's happening in the world on a single, on a daily basis, like every single day of the year, and so I think, not really understanding how much of the world actually was in a state of almost disrepair, is something that, when I discovered blockchain and I really started looking into the problems that blockchain was solving, I understood so much more about how many problems were out there. So, in some regards, I had this light bulb moment, because blockchain, or doing the research into blockchain, is what shown a light, illuminating how many issues existed in the world that I didn't even know about. And then, on the other hand, being from Africa, south Africa and, you know, born and bred here, although I don't live here anymore, but it's it's it's equally amazing and really hot, really disheartening and sad to come home every time because there are so many problems on the continent of Africa, you know, within the country of South Africa. So I was also faced with these issues, even though, as a privileged person in society, it didn't necessarily affect me to the same extent as it has other people in the country or on the continent. But because some of the problems that I was already as much as I could intimately familiar with, I was also able to recognize that blockchain offers really, really sound opportunities to do things differently for these issues as well. 

So, yeah, just then again, to conclude, that is the dream. It's not necessarily something that we are seeing on a daily basis. I would love to say yet, but I think it very much depends on the choices that we make leading to the next step in society adopting certain technologies for the right reasons. But yeah, again, we can. We can get into more of this as we talk more. 

0:09:55 - Mehmet
Yeah, you know, like I love one thing you mentioned, which is when when you said about how we perceive things right. So you know and you took actually one question also that I wanted to ask and this is where I would just say something very quick is, like any other technology, it's our choice to do good things to solve serious problems or, you know, do something bad and like and I believe you know with someone, you know with an experience like yourself, and you know all the the cause, and I know, like you have a cause, nadia, here like things, good things can change Now and this is why I know you, you, you believe in, you know, and this is what I, you are doing today at at them, you're trying to promote a sustainable investment practice through an engaged model. Can you explain that little bit more? 

0:10:56 - Nadja
Yeah, so I think you know first to start off, before I get into exactly what, how at Luna addresses the issue. But I think let's first look at the issue and talk about why it's important. The average person here's the words Bitcoin, ethereum. I mean, the average person probably doesn't know many more names other than these two, although there's an entire industry with literally thousands of coins and tokens out there, which is both part of the problem and the opportunity, of course. But so the average person, when they think of the word cryptocurrency, they know the word Bitcoin. They might have heard of Ethereum and what they typically would know is oh, the Bitcoin price sometimes is really high and sometimes it's really low, and you know, the word scam often comes to mind as well. 

So the the typical level of education for these cryptocurrencies and blockchain technologies when it comes to the average person, if they haven't spent a lot of time looking into it, they simply don't understand that it that's not a problem on there on their end. It's because it's extremely complicated and complex and that's why there's an entire industry that has that has popped up around it, because you almost need a translator to be able to understand pretty much anything. That said, if you're not already you know on some sort of foundational level in terms of your understanding. So I mean this, of course, is a massive issue, something that I think everyone in the industry understands and agrees is a massive problem because if you talk about adoption never mind mass adoption, but any kind of adoption people need to actually understand what's going on. But that's not because it's always technically difficult to understand, because there's, I would say, you know, a misconception there that people think in order to understand any of these things, they need to understand the technical aspects. Actually, it's a lot more complicated than that, because if you look at this industry of web three, you need to understand at least the bare minimum of the technical aspect. You need to understand economics, you need to understand psychology. There's, you know, there's there's a number of different domains, disciplines that are all merged here, and I think that also geopolitics is another one. So that really makes it very complex for the average person in terms of the amount of time that they can give to this. So, with this as a backdrop, then we need to understand that if the average person who doesn't understand much, now sees in the media oh my God, bitcoin is at 70,000 USD immediately rushes to buy, and I mean not understanding that the market is very volatile and you know it might go up and it might. It certainly will come down again. 

Bitcoin is perhaps not the biggest problem of all, because Bitcoin truly is, I mean in as much as we know. Actually, you know the Toshino Komoto, the creator of Bitcoin. No one actually knows who it is, so there's a lot of myth and law surrounding. You know this, this creator, but I mean there's no company, there's no centralized company around Bitcoin. The currency itself is truly decentralized. So Bitcoin is not necessarily the biggest issue, but I said earlier, there are thousands of other coins and tokens. 

That really is where the issue comes in, because the ability to raise funds Well, first of all, the ability to create a company in the Web three industry, because it's such a very, very early space, stage space it's very easy to create a company, very easy to get funding, very easy, you know, to act as if you're a trustworthy company while not being one whatsoever. So this, I think, is really where the conversation is centered for us, because, on the one hand, there's the fact that companies who are not trustworthy should not be receiving institutional funding from venture capital, although this happens frequently because it's such a fast moving space, especially in the so called bull market, which we are not in right now. We are currently in what is called a bear market, so it's very slow moving. But in a bull market, when when that's when you see the price of Bitcoin flying sky high, so during those markets you know VCs will say yes and send you a bunch of money in a heartbeat because they don't want to lose out on the opportunity. So the due diligence that is done is not as comprehensive as it would be in a bull market, in a bear market, for instance. 

Now an institutional investor might understand how to do due, due, due diligence because that's their job, but for the average retail investor, they have no idea how to do the proper due diligence because that's not their domain of expertise. And so, unfortunately, because the space is unregulated not to say that they are not untoward things that happen even in the regulated space. If you look at the 2008 housing crisis, I mean, there were a lot of things happening there within a regulated space that led to something like this. But to exist within an unregulated industry means that you can either choose to do the right thing, sort of taking the responsibility upon yourself to be an organization making the decisions that supports the vision of what you are doing. So if you're talking about Web3 being, or Web3 technologies being, transparent, championing transparency, then you can choose, as a company, to champion transparency because you're in the Web3 industry, or what other companies do, unfortunately, is they use the fact that there is no regulation to do whatever they want. 

And so I think that, really, if you're talking about investors and really what we focus on, that is where the important differentiation comes in is, if retail investors are not able to understand fully by themselves, based on the limited time, energy, education, educational resources, then we want to make sure that there's a space where they are able to participate in investments only with companies that we at least know are vetted as much as is possible. 

And the way this is done is because we have a investor network, an institutional investor network. We only work with projects that we know have been vetted by many, many other, whether they be partners, whether they be investors, whether they be advisors. So we have a network of different categories of people that we run these projects through. By the time that they get to the retail investor, they have been vetted as much as you can be, and I think this is something that is really important in a space where you can find the best of people and you can find the worst of people and you don't necessarily know how to differentiate between them, because if the worst of people have the same playbook as the best of people, then how do you have the savvy to know that, okay, this is someone or a company to stay away from and this is one to support. So this is definitely something that the industry is still figuring out and, at LUNAM, is definitely one of those solutions built in order to contribute to the figuring out of this problem. 

0:19:10 - Mehmet
Fantastic, nadia, like you, unlocked a lot of things, unloaded a lot of things. Now, just to make a relation to something you mentioned. So I believe one of the reasons why people get skeptical about when you mentioned the world cryptocurrency and so on because two main things. First, it's not regulated. I mean, this is one part. The second and I remember back in it was very booming at that time in 2016, 2017. You know, we were seeing this bunch of what they used to. I think still they are there like ICOs, like initial coin offering, and 99% of the time I think they were fake ones, that there is nothing over there, and this is what let people do this. 

Now, there is always a question I ask, and maybe I'm gonna ask you two questions in one, and excuse me for this, because it's related somehow, people, for some reason, still although the people who really believe in the technology, in the blockchain it's about decentralizing, about not relying on a single source, so they get it but people who see it as investment, still they need to tie it to a dollar value or whatever fiat currency value. 

Don't you see, like this is one of also the main pitfalls? Is that still till now, after I don't know since the first paper came out I think it was 2008, if I'm not mistaken, or 2008. Still in our minds, we're still relying on some fiat currency and actually we saw also what happened, you know, with the crypto exchanges, like without mentioning names now, and this is added also like some skepticism to people. So the question I want to ask you and I know you are doing something regarding this with this proof of attention allocation but how we can fix this, nadia, like what's the way? Because we know from as people in tech, people in business, we know that, yeah, this is not its cool, it's something that really solve major problems how we can get you know the government with us, how we can get you know the mass people with us and how you are trying to solve this. 

0:21:29 - Nadja
Yeah, definitely a very, very good question. I wish I had A an easy answer, or B even just an answer at all. I'm gonna start off by saying I think that skepticism is incredibly important. If you're not feeling skeptical when you encounter something new, that itself is questionable. I think we need to actually be more skeptical in the industry than we currently are. 

I think what has happened, you know, perhaps from a sociological perspective of sorts is the evolution of this technology. I mean, it's certainly if you look at let's say you look at the history of the internet, you know there are parts of it that you absolutely don't know about and there are parts that are more well known. So, for example, the Steve Jobs slash Bill Gates saga, you know that's kind of a highlight on this journey of the history of the internet, but certainly a lot happened before that as well that might not be as well known. A lot of people contributed to making something into something, and then you know the kind of it's taken from there. I mean it's exactly the same thing as generational legacy. For example, parents create or build something and the kids either take it further or they don't, and I think that's actually quite a good analogy, because the parents might create something, thinking the kids are, you know, gonna do take it to the next level this way or that way, and the kids might agree or they might disagree. And I think that's very much what has happened here as well, because if you look at what we today think of as blockchain technology, and I mean crypto, falls under blockchain. So everything that we talk about falls under the big umbrella of blockchain technology, although it's not always the case, because now you have web three, so web three is, you know, the, let's say, the next version of the internet, as it's typically known as. 

So, as web one was very static internet, that's the time when, you know, engaging with the internet wasn't nearly as much fun as it is today. I don't know if I even was on the internet back then. Web two was the social media internet, so think about Facebook. You know that era. That's web two, and we all know, of course, that web two is dying off, so to speak, because we can see that I mean even threads, meta released threads and, yeah, there's almost no engagement. The users you know there was a mass influx of users and then, since then, pretty much no one visits the site, and this is meta. That can't, that can't, you know, push this web two era into into the, its next phase. So web three is then touted as okay, this is the future of the internet. Now, web three typically involves blockchain technologies. That has, you know, all sorts of cryptocurrencies, nfts. The metaverse is also grouped in there, so it's a big, you know umbrella term for lots of different technologies that are all kind of playing together. 

I think the thing is that we really need to keep in mind is that differentiation. You said earlier. You know the people who originally had some sort of vision and then kind of, where is that vision today? So I think it's important to note that they it's like divergent parts, right? I think depending on which corner of this industry slash technology you've been involved with, depending on when you entered the space, your understanding and your alignment, even your motivation, might be very different. 

So for me, I came in in 2017. This was just before the start of the crazy ICO age, so I caught that tail end of, you know, being very visionary still, which was great, but then it kind of morphed very quickly into the ICO days. I had a communications agency at the time, so, I mean, business-wise, it was great, but there came a point where, as you rightly said earlier, I realized, you know, I'm inadvertently supporting scams, because a lot of the clients that I work with I mean not that I knew it was a scam, but then it turns out it was, and you feel so implicated because you had no idea that you were contributing to something that was actually harming people, as opposed to the promise of it, which was, you know, all these great solutions that I was going to contribute to the world and society or whatever industry it was touching on. So I think you know, having seen the evolution from then, and then we had the COVID era, where NFTs blew up, something crazy and suddenly NFTs were going to literally save the world, the way that crypto was gonna save the world before, when blockchain was gonna save the world before. So you know, to kind of sum up this whole phenomenon that we've been seeing, I think that different types of people have poured in the things that are the most important to them. 

So you have visionaries who believe in a different tomorrow and they have put as much as they can into this, and you have criminals, outright criminals, who have said well, I mean, have we ever seen a better opportunity and they have pushed everything into this. And you have builders who are saying you know what, for whatever reason, it's not that easy. The glass ceiling and other industries are too low or too thick and I cannot be able to bring an idea to life in another industry the way that I can in this industry. A lot of this is because of the institutional money flowing into startup investments in Web3. And I'm going to make the best of this, and for a lot of them, they are first-time founders. It's really not easy to start up a business in any industry, and particularly so in this one, and some of them make a great success out of it. Some of them have to pivot, a lot of them fail and there are some of them, of course, who use this opportunity to what they call rug pull, you know, run away with the money. So basically, just a scam. 

So I think what has happened is so many different people from different, let's say, ethical and moral standings have entered into the space and at this point, I don't know if we can say, oh, this future is amazing. At least, I don't know if I can. So that's why I said it's incredibly important to always be skeptical, because, as much as I am a convert to the promise of what the technology holds, I also see the possibility that it has for abuse. I see as much as I'm someone who's always believed that it's possible for an industry to exist without regulation. At the same time, I can also very, very painfully recognize where regulation is needed. 

So I think if you are in any case involved in something like this that's still so early and is evolving as we speak, it's dangerous to take, you know, only a particular standpoint in a particular direction. 

And I've certainly myself been guilty in this of the past. 

Because I think, when everyone else is against what you are doing, because you know they don't understand it or they just don't get it, or you know, whatever you say, it's easy to kind of be pushed to the extreme and then say, yes, but it's gonna solve all our problems and it's gonna fix everything. But then you certainly get to the point where you realize, look, there's no fix at all, for this world. Society is gonna, you know, crawl along at the same pace that I was going to, whatever we were going to do or not do. Now, with the influx of AI, we see that a lot of changes are coming really, really rapidly, and I don't think it's prudent to say that there's any particular technology that's a solution to anything. So I think it's really good for the web-threat industry to practice a little humility and to realize that, as much as it can be a lot of what the future is about, there's also another, let's say realm of possibility where it's not a solution at all, and it's up to us which one it's gonna be. 

0:30:41 - Mehmet
A great insights again. I think you covered a lot of the things and one thing which you are right about it, in my opinion, is some of the people who could have the hat of mentors or, if you want, like thought leaders, they didn't do enough job. I mean their job to educate the rest, and this is why I know, like today now, that you do this as a startup mentor. So when someone comes to you, let's say I come to you and they say, hey, I gonna do something in Web3. So what's the first, like maybe two or three questions you're gonna ask me. 

0:31:24 - Nadja
Number one, definitely. Why Web3? I think this is a sign of the times, and when I say the times, I mean, as I referenced earlier, the bull market and the Bay market. So it's a sign of the bull market when everyone is coming to you wanting to create something in Web3. And the reason is not because Web3 is the best solution for what they are, what they are envisioning, but because it's pumping right now and we need to get on board. So I think that certainly is the first question because, again, depending on when this question is asked, if it's asked in the Bay market, which we have been in for the past two years, it's really funny how, when the crypto industry, that is very much tied to the financial aspect of it, which is something that for me, that's not the only thing that there is to it, but I mean it's impossible to ignore that the market is intricately tied to the financial inflow. That is essentially what the industry in many ways are about, as opposed to what the technology is building. And so, in a Bay market, if someone is wanting to start a company not that this is across the board, something that always is the case, but more often than not it means that they are passionate about what they are building, and it might not be necessarily that they think Web3 is the ultimate best solution, but it might make it easier for them, whether this be funding or whether they think they'll get more traction that way, but they typically are at least excited about the business that they are building, which is something you need to be right If you're starting a new company. I mean, I don't think there's anyone, whether you are in business or not, but I don't think there's anyone out there that doesn't think that if you start a company, you should be excited at least in some way about what it is that you're doing. You don't have to necessarily like the every aspect of the idea, but the idea of starting a business should get you excited. 

Now, I think in a bull market, that aspect flies out the window a lot of times. I think what get people excited is the possibility of making a lot of money really quickly, and I'm talking about founders, of course, investors, retail investors as well. But I'm sorry, I don't know why I have like a million reminders going off now. So if you talk to a founder, a first contextually important to kind of check which market you're in, because that will say a lot about the intention and the founder as well. But so definitely why they are choosing WIP3, because I think a lot of times it just it seems like it's an easier thing to do because you see a lot of money going into it or you know it just it seems like it's possible to get things done in a way that you won't get them done without these technologies. 

But it's also important to keep in mind that something simply shouldn't be tokenized, like everything shouldn't be tokenized. There's this thinking, line of thinking or school of thinking, even in this industry where if it moves, you know tokenize it. I'm definitely not of that camp. And then second, I think, is why someone is doing this at all, I think being a founder, no matter what industry you're in. But I mean technology, especially because we live in a world where everything is technologically driven. The perception of what loyalty means has shifted dramatically to the point where you know we can hardly recognize it from one generation to the next. 

So if you're a founder, building a product or building a software, or you know building a token and Web3 or whatever the case may be, this is a difficult journey and again, for a lot of people because it's the first time that they are building a company, there's a lot of misconceptions with how easy or how difficult it's going to be, and people bring a lot of you know traditional thinking that perhaps is not based on their own experience, but what they've heard from others, perhaps even in other industries, or what they've experienced in other industries, whereas in Web3 specifically, it's a very, very particular space. 

I always think of it as like a suspended disbelief, almost, where you leave behind the reality that you know and you enter through this portal and now there's this new reality where there are different rules and it's a sandbox, right? It's a sandbox environment in which you can go to the one corner where all the bullies are, or you can go to another corner where, I don't know, there's a baby animal nursery, and you know you can kind of find what you're looking for in different corners of this world. But ultimately, we need to understand that this world is like our world You're going to find great things there, you're going to find horrible things there, and then the twine shall meet, and often in the same person. Even so, yeah, it's an interesting space, but I always love to talk to founders. So if you're watching this, definitely do reach out to me. I'm very happy to have conversations like these. 

0:37:12 - Mehmet
You know, like I think we are having a lot of common points here because, to your point, when someone, sometimes they come to me and they say, hey, I got to start something in AI because you ask why we're free, I said why AI? Right, and now we are seeing actually in AI world the same thing and the first thing, okay, why do we need AI in the first place? Like. The second thing I like is you don't have to tokenize everything. Use the technology, but you don't need necessarily to have a token with it. Now I can understand and again, like fantastic way, how you put it. You know, I like the sequence about loyalty, right, so some people are saying it okay to make these customers, at the end of the day, loyal to us, so we're going to give them tokens. I'm totally fine with this. I can understand that. 

But I believe and you have more experience than me, I believe Nadia is, and this is how I address every single startup what are you trying to do? What are you trying to solve in the first place? Now, technology and I had Artem the current few episodes back and he said you know AI, he was talking about AI, but it can be applied and actually he mentioned it. It's applying to every single technology. The technology becomes like your vehicle, right? So you just need the vehicle to take you from point A to B, which is, from the problem state to the solution state. So I love this approach and definitely I advise, like anyone in the Web3 interested maybe they are, I can understand also as well like they are enthusiasts, right. So there's an enthusiast who loves AI. There's someone else she loves I don't know, maybe still loves Web2. I can understand, or like AR VR, fine, I understand this, but again, go and try to find why you are doing this in the first place. I really love the way you structured and actually destructured Nadia. Now something. 

0:39:18 - Nadja
Yeah, I just want to add there, because I think this is really important to note is you know what you're saying about people don't in Web3,? I mean, I feel like this. I'm seeing the same in AI, but it's not nearly as pervasive in AI, because in AI we're talking to average people. They are not really AI DJs the way that they are Web3 DJs right. So I'm seeing it in AI, but to a much lesser extent, to the point where AI is able to capture those people who don't really know that ChudgeBT exists. If you see a product, you see an ad on Facebook and you haven't heard of ChudgeBT, but now you use this product. That's kind of what I'm the similarities in AI space. 

But in Web3, I wonder how many founders ask themselves the question what problem am I solving Because of the amount of Web3 DJs? So a DJ in someone who is kind of all in on the technology and like they're a true believer. So, as I said earlier, if you have to stand fiercely behind your own beliefs, it's almost like you can't entertain criticism at the same time. You can't practice healthy critical thinking of what you're believing in so much. And I think that's the danger in Web3, is because this is allowed, or even encouraged, to perpetuate this habit that we don't question ourselves. Who watches the watcher? Who questions the man with the ideas? Who critiques the ideas? 

So, because this is not being done and because funding is given within this, so even VCs are not questioning and saying, look, this is great, but who is it for and what problem is it solving? Because actually, if there are no users, so if you're creating this incredible solution to this problem, that's theoretical. Because there are no users, so there's no one experiencing the problem. Why should I be giving you so many millions right now? But those are the questions we are not asking. We are just saying, oh yeah, sign me up, where's your account? I can send you all these millions. And unfortunately, this is a big part of the issue from an institutional perspective. 

0:41:47 - Mehmet
And this is actually we bring me to the next question Thank you for getting this here how the if we can call it, the realm of the investing is different from other industries than Web3. Is there institutional entities that are acting like VCs, private equities, that actually they do it in the maybe cryptos that we know, like Bitcoin, ethereum and so on, or is it like real money that goes there and then they tokenize this? So this is maybe first part of the question and this when you do the fundraising in a proper way, like in normal startups and I'm wondering and I'm asking this also to enlighten the audience in the normal startup world, like we have the angel round, we have the pre-seed series A and ultimately, ultimately, you know you have an IPO Like do we follow the same step, you know? Have you seen like companies follow the same route in the Web3? 

0:42:53 - Nadja
So in Web3, typically it would I mean for a startup obviously to get running, to get up and running in any way, there needs to be some sort of capital. So typically, you know, if someone has access to friends or family or they have some of their money that they're able to put in, then there would be an angel round in the same way that we have in the normal startup space, but there's no set rules that are followed. Typically, again, it would be the angel round, and then it would be or pre-seed, and then it would be seed, and then you'd have private, then there might be what's called a strategic round and then you ultimately have the public sale. Now, the public sale. As I said earlier, I'll work backwards the public sale is similar to an IPO, but again, it's not regulated. So it doesn't function in the same way. It does. The same rules don't apply. So public sale essentially, how that happens is because everything is based on tokens. So the price that you buy in will be the most expensive at the public round. So I'll just give some generic numbers just so we can anchor this. So let's say the public sale you buy each token at 20 cents. Now in the private sale. Or let's say, in the strategic round, you might have bought the same token for, let's say, 18 cents. In the private round, you would have bought it for, let's say, 12. And then the seed may be for eight. That's a huge bargain. So from this example, you can then see that obviously it's much more beneficial to participate in at least the private sale as opposed to the public sale. 

So, typically, the majority of funds and this is something that has changed a lot, because in the ICR days, the majority of funds were actually raised from the public, from the public sale. So the ICR, the initial coin offering this was something that happened on the website of the project raising funds, which is one of the reasons it was so easy to scam people and run away with their money, because, I mean, you were literally putting your trust into a company you don't know, a website you don't know, founders who you don't know and are anonymous or has no track record. So now, today, it's a little bit different. We don't really do ICOs anymore as an industry. Whenever you see a project doing an ICO now, it's a red flag more than anything else. It's more you know, you get the sense that they are trying to capture people who don't know that ICOs are not safe, because it's also a very outdated way of fundraising. So that also means they, you know, don't really talk to people in the industry, which is also concerning, of course. 

So today we do what's called IDOs, so an initial DEX offering. Definitely don't have to get into the technicalities of that. That's something that, if you were interested, you'd read about it and then, even after reading about it, you might not still understand it until you actually participated in one and then understood okay, this is how it works, which is why I said earlier, this stuff is really complex and it needs to be made a lot easier. However, if you now look at an IDO today, it's generally the smallest portion of the fundraise amount. So the public sale has gone from being the biggest portion during these ICO days to now typically being the smallest portion. So the majority of money to be made to be raised, but also to be made as an investor is then in the private round or strategic round, if you couldn't get into the private round, but ideally the seed round. 

So you see a lot of VCs. Especially, again, it depends on the market. So in the bull market, vcs are like gorillas in the mist. A lot of them just disappear and they are laying low and they are licking their wounds and having lost a lot when the market turned and now just really kind of lying low and waiting for whatever the new market is going to bring. So that's on the side of being a VC and then, of course, being a founder, depending again on when you're raising funds, which market you are raising funds in. 

If it's the bull market, you are not chasing investors, they are chasing you. You are not saying you know, you are not asking them to invest, they are begging you to invest. I mean, we we experienced this personally. Even at it, lunam, we raised a million and a million dollars in 24 hours. We raised two and a half million in five days. It was a whirlwind and we turned down a tremendous amount of money and it was almost shocking to me to see how easy it is. But that's in the, in the bull market. And then you get to the bear market and suddenly everyone again becomes conscious and aware of the fact that it's real money that they are parting with, because if they're investing in you, yes, you know they might make a 10x gain, but that's in a bull market. What happens in a bear market? Now they remember oh, but this is real money and I am giving you this money because I want to return on it, so are you actually gonna give me a return? So the rules get rewritten every time that there is bear market, and so what? What worked in the previous market is not gonna work in this market, and I think what's happening at the moment, because it now seems like the market is picking back up. 

You have the Bitcoin ETF from BlackRock. The application is either gonna come in during the next few days there's this 12-day window of opportunity or it's gonna happen, I think, on the 10th of January. So that's gonna bring in a lot of new interests and a lot of new faces. They're also looking at an Ethereum ETF, so that's happening sort of on the macro level, where I think a lot of new institutional investors are going to enter crypto Specifically. You know these, let's say, granddaddy Currencies that we are talking about, but the the opportunity Risk because I don't think you can separate the two is that a lot of those new people might then turn their attention to the altcoin industry, which is the art, the other coins that are not these that you know, let's say the top ones. 

And again, if there's a lack of education, you know you're gonna see a lot of people putting money into things without understanding what actually is happening with this project, what actually is happening with the technology. Because it's important and it's actually super important to understand that if you're investing, let's say, into a metaverse company today, they are great possibilities for the future. But what, what? What time frame are we talking about? Are they going to be the amount of users on this particular platform within the next six months, within the next year, two years, five years? Is that actually going to happen? Or are we only investing in a dream? And I think it's fine to invest in dreams, but especially in this industry, dreams have to be followed by execution, because we've been investing into dreams for a really long time, but we're not seeing them being materialized, and so I Fingers crossed that now, as things change, the industry is maturing to the point where enough people will ask critical questions rather than just part with their money. 

We know that saying about you know, be it being easy to be parted with your money, you know it makes you a fool. I don't want to say that the technology is so superior that people that don't understand that are fools, because I think something needs to be easy enough to be understood, but certainly, I think, internalizing the the truth of the matter, which is, if it's too good to be true, it's probably not real. And if you don't understand enough about something either, you know, don't invest money that you can't lose, which is always a good idea. But I would almost go as far as to say, if you don't understand something, really second guess and question yourself on whether it's then a good idea to invest at all. Would it be a time investment better spent to understand, to study more and to learn more before you invest, as opposed to seeing something being promised here and there? 

I mean I personally I will invest in the, in the, in the private rounds, but for me, I mean I don't invest just because there's a great company or there's a great idea. I really need to believe that what I'm investing in is going to see the light of day in future. And in other areas of tech it's not easy to get away with promising and ever delivering, but in web three, that seems to have become institutional and so, again, super important that everyone starts asking well, if I'm going to invest. I don't want to invest in what you're going to give me tomorrow. I want to invest in what you did yesterday. So, yeah, we are hopefully positive changes coming up in the in the next market. 

0:52:50 - Mehmet
I would call this a masterclass in investment in general at Web three investment and you know, like we know, it's common sense. You know I told you like I am living Dubai and I see people coming and going. You know, sometimes I used to go to some gatherings and I mean, typically, you know they are okay. What do you do? I explain, I have background in tech, I do business and, hey, what do you think about, like cryptocurrency and this? And then I have the conversation and they figure out that these guys, you know they invested without even knowing what they are doing, just following a hype. You know, not understanding and, by the way, for people, you know, because they think that I don't like the technology is not like the case, yeah, I have you have me on, so obviously, obviously you don't hate it. 

No, no, no, of course, and you've been nice to me. 

No, no, I did a lot of episode when I used to do solo, so I used to even explain how blockchain can be combined with other technologies, and not only I can be many things, because at the end of the day, it's a proven technology. It's not like something which is, you know, we still think we can use it. Actually, we are using it today. But, you know, the point is understanding and this is again because I work with startups and you know I talk to investors about, you know, understand what you are investing in. So if I don't know, let's say anything about agriculture, right? So I will not go and put my money in land and someone will tell me, hey, we're going to grow some trees there and plants, and I don't know, you know I don't know. 

I would go and invest in something. Either I would study and I find it's easy to absorb, and then I can do it, or I would not do it. So and I think this applies to Web 3 as well so either you understand and I think you know. But the point that I think you explained very well here, nadia, is about, you know, the macro and micro part, and it's like any other market. It has its bullish moment, it has its bearish moment, right. So this is very and, by the way, nowadays we are seeing the same thing in the traditional fundraising, you know, and VCs, you know there's a drain in money in some areas, like in North America. You know, in some areas here in the Middle East, we are lucky that we are seeing the money pouring, so it's like a very bullish market here. Where it's like bearish in the US and even in Europe, it's still. I think they are facing some issues, but things might turn around anytime. 

So this is something you know. It was a masterclass. Now, I know, like you know, we could cover a lot and a lot, a lot, but you know one. Maybe one final question, if you can, and you know I get excited when I get to know and you mentioned also in your intro about the documentary. I know you might not be able to reveal everything, but on a high level, like what's the future is hiding for us, nadia, like if you can tell us, like just hints. 

0:55:53 - Nadja
Yeah, I mean I again a question that I would love to have an answer to. We definitely creating the future as we speak, but I think what's most fascinating to me about the future is this idea that the concept of our personal identities are shifting so much. I don't know about you, maybe it's an indication of how big a problem I have, but I mean, I have my phone in my hand every moment of the day, and when I don't, I feel like something really really precious is missing. And this is not because I particularly love holding my phone. I particularly love using my phone. It's that my identity, not because I necessarily chose. I don't know, if I had the 2020 hindsight that I do now, if I would have made the same choice, as perhaps I would have used technology in a more mindful way, if I knew kind of how much it would change my perception, my habits. But, on the other hand, I think it's almost inevitable because most people in the world that use technology are experiencing the same thing, which means that, as a species, we are evolving to the point where we cannot exist really without technology. I mean, if there's an apocalypse, we can all exist without anything, but if things go as they are, you know, in a non-apocalyptic way, although maybe it's already going in an apocalyptic way. That's debatable. But so we are so intricately tied to technology that we can't imagine our lives without it. However, it's not the phone that I'm concerned with. It's that my identity has been augmented in some way, that my identity is not only my being but also, in a sense, how I am interconnected to others and how I express myself. Now, I mean, these are very, almost spiritual concepts, if we choose to take it in that way. So I find it very interesting that technology is almost like a tangible expression of what some you know, like in Buddhism, for example. We can philosophize about these things, but in technology we show the practical application of it, for better or worse. So I think for me the most fascinating thing about the future and how technology plays a role in this is it's no longer me plus technology, because it's almost impossible to separate it too. I mean I certainly cannot imagine having a future without technology. I mean I don't want one. 

Technology is not a great force for good at all times. I mean it makes me lose sleep, it makes me lose focus, it makes me more unproductive. Sometimes it distracts me. It evokes all sorts of emotions in me. There's all of that. There's power hierarchies that need to be looked at in society in terms of technology, so there's a lot of not great things, but at the same time, my life is one that we are used technology, and so, if I look to the future, what does it mean? 

Maybe I don't have a phone at all. There's this humane AI pin that just came out. Yeah, I was so excited because I'm on the waiting list and I got my email yesterday saying I can order, and then I saw it's only orders within the US and I'm like, oh my God, ok. So I guess I have to live with my phone a little bit longer, and that really is for me. Something that I'm going to find very interesting is to see if I have this device. Do I need my phone as much? Is it more about interacting with this external I almost want to say being and I think that illustrates how our relationship to technology has changed, because it does feel like it's alive somehow, and maybe Siri is alive or I don't know what's. 

Alexa is alive. Ok, google that she really needs a name, but maybe they're alive. Or maybe different apps come alive, or now. We have different relationships with different types of technology, but I think for me that's the most interesting is to see, ok, what's that future going to hold. It's not necessarily going to be fantastic. I mean, if you've watched Black Mirror, you can see kind of a lot of these things are things we don't want to happen and, again, we need to be guardians. All of us, every single person that engages with technology, needs to be a guardian and go. Ok, I need to think about what's happening here and so, in a very roundabout way, I think that's kind of what the documentary focuses on. 

1:00:40 - Mehmet
I'm looking forward for that and a lot of things. Yeah, the questions you ask I ask always myself the same thing. And to add to what you said about the assistance and all this and now we have for me, I can't imagine myself without chat GPT anymore. And now what I have done when they released last week the GPTs OK, maybe you are seeing this in like two weeks later than that, that's fine. So I've now six, seven GPTs, each one for something, and I know, if I get the time I got, to let them talk to each other at some stage and I will give some more to them. 

1:01:18 - Nadja
I didn't know they could do that. That's amazing. 

1:01:23 - Mehmet
It's not like on the normal UI. It's something that you can do from the API perspective, so you can have a lot of things. I tried something similar before. It's not like mine. There was something called auto GPT and baby AGI. 

1:01:40 - Nadja
I remember I tried the auto GPT yeah. 

1:01:43 - Mehmet
So, but think about it in more, like it can automate that, so they can integrate with Zapierre, or like, for example, something like makecom. Yeah, so OK, so it's exciting times like it's really exciting times. 

1:01:58 - Nadja
No, maybe, maybe in closing, because this is something I thought of earlier. So maybe in closing I can say this doesn't only count for Web 3. I think it counts for anything in life, but most certainly technology and anything that relates to the future. Like we are in a very exciting time, a scary time too, but we're an exciting time where there's an open ended invitation for anyone to come and play. So it's like if you think about going to a nursery school and there's a big sandpit and there are lots of different kids and there's a playground and the kids are playing side by side they're not necessarily all playing together, you know at that age they just want to do their own thing. 

Think of it as something similar, like there's really nothing stopping you playing around with it. And I think that's exactly what we all should be doing, because it might be something that interests us or it might be something that we are not interested in whatsoever, but in order to understand what's out there, in order to understand what is shaping the future, that's the only way that you can prepare for the future. No degree, no training, no, anything can do that other than observe in real time what is happening and understand it to at least some degree 100%, like as you said, it can apply to anything. 

1:03:22 - Mehmet
Nadia, like I know, you know like we wish we could have like more time, but I think there will be a part two and part three of this conversation. I'm pretty sure about that. 

1:03:32 - Nadja
That would be amazing. 

1:03:33 - Mehmet
Yeah, I would be having the pleasure again to talk to you. So thank you very much, really appreciate. I know that you have a very busy schedule, so thank you very much for sharing your knowledge on the show today and this is usually how I am. Of course I should have asked you, you know, but I can put the in the show. Knows the link to Adronam and your link in the profile, if you don't mind. So, people, if you want to connect with you, yeah, absolutely. 

Because usually I should ask you this. So, but I'm going to make this as a preventive action from my side, and yeah, so, as usual, thank you for everyone. If you are a first time listener or viewer here, thank you very much for tuning in and I hope you become a loyal fan. And for the ones who keep you know, sending me their message, thank you very much. I really appreciate it. I'm trying to mix, I'm trying to do some things, so thank you for all your feedbacks and, as usual, if you're interested also to be on the show, let me know. I can arrange for this time zone. Geographies doesn't matter. So thank you very much for tuning in and we'll meet again very soon, thank you. 

Transcribed by https://podium.page