#447 Islamic Finance Meets Blockchain: Ethical DeFi with Haqq Network’s Alex Malkov & Andrey Kuznetsov

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Mehmet: Hello and welcome back to a new episode of the CTO Show with Mehmet. Today I'm very pleased joining me, the team from Haqq Network, Andrey and Alex. Andrey and Alex, the way I love to do it, I keep it to my guests to introduce themselves, tell us more about, you [00:01:00] know. Your background your journey and what you're currently up to So I gotta start from right to left because you are both in dubai.

Mehmet: I know Andrey usually In hong kong, but as arabic starts from you know, right left. I will start with alex first So alex, if you can tell us about you and then we can get to know more about Andrey

Alex: My name is alex. Malkov I'm the co founder of the Haqq Network, and also I'm managing one of the biggest contributors to the Haqq Network.

Alex: So, um, I don't know. You want me to add something else right from the beginning? But I'm happy to be here.

Mehmet: Thank you. Thank you, Alex. And, uh, Andrey, like, uh, about you a little bit, your background and, uh, your role.

Andrey: Yeah, I, I am also co founder of Haqq Network and I am a CTO, so managing all the technical operations, development, product development, and together with Alex as a co founder, [00:02:00] we are driving Vision, Haqq Network, and IslamicCoin.

Mehmet: Great. So feel free gentlemen who would pick the question, but you know, the first thing first that usually I ask my guests, um, you know, if you can give us a little bit, an overview about the Haqq Network and what was the motive to start it? And, you know, um, some background if you want also as well, and then we can start the deep discussion.

Alex: Sure. I, I can start. Uh, so the idea of the Haqq Network, It's actually pretty simple, yet a little bit complex, especially for those who are not familiar with, uh, Islamic finance in general, but in a nutshell, our idea, and I would say like the premise from which we started. The drafting of the Haqq network and actually its future and the main token of the network, which [00:03:00] is, uh, mostly known, uh, Islamic coin.

Alex: So they're not in a position, but as a standalone, as a standalone thing, the Islamic finances are actually, were always. We're always like, uh, very interested in a peculiar industry, especially when you compare it to the traditional Western finances, because it excludes many, I would say, so like a grid driven practices, you know, the interest of prohibited, all the complex derivatives, which are usually triggering unfair market practices.

Alex: They are also excluded. And in a sense, we wanted to bring this pretty much the same, the same base to the, uh, to the crypto, to the web free. Because if you look around, especially these days, uh, the crypto defy, they are mostly about like a quick profiting and usually they [00:04:00] benefit for those who are like either in the industry for a quite a long time or webinar They are actually front running those, uh, the such called normies, uh, irregular people who are coming into one project or another or purchasing one token or another.

Alex: So it is, there is a big, big disbalance in terms of the risk and actually the benefits, which is also actually one of the problems that Islamic finances addresses. Those are the sharia law addresses by. Nudging by mandate, uh, not even nudging, but making the purchase to balance, uh, the risk and benefits for each other.

Alex: So it dictates that every deal has to be transparent, fair, and with a. As predictable outcome as possible. So we wanted to bring those practices to the web free and also to make it more inclusive, uh, [00:05:00] more, more to make it more the crypto in general, make more accessible by the, uh, by the Muslim community, which is a huge, approximately almost 2 billion, 2 billion Muslims all over the world.

Alex: And half of them are. In one way or another are online. So we decided to create this ecosystem, this layer one ecosystem, you can call it, you can call it as you want, that would actually breach the Islamic finances. From the web two to the web free and actually consequently bridge the Islamic finances to the current defy space.

Alex: So this I would say the idea in a nutshell and we are actually doing it for the last couple of years. Yeah.

Mehmet: Yeah. This is really interesting, Alex. And, um, you know, because. Usually when people think about cryptos, they think about, you know, all what happens to your point [00:06:00] They don't imagine that you can bring islamic finances over there, which is really an interesting point now Before I go like more about the use cases says I want to ask Andrey about you know From from the technology perspective like you're the cto uh so It's it's an area which is kind of also I would say emerging so for you As someone, you know, who has this long experience also as well, uh, in, in the fintech and, you know, in the blockchain.

Mehmet: So what excites you from technology perspective to be working on the Haqq network?

Andrey: Oh, well, uh, I guess when I started working on Haqq network, I kind of stopped focusing just on technology because when you deal with the Sharia compliant financial products, [00:07:00] It's, uh, not just, uh, implementing a smart contract and the front end for it.

Andrey: It's always working together with the legal department and with Alex in particular to, to find a common ground between legal constraints and Possibilities of the technology. So at some point, I believe Alex will agree with me. I became a little bit the lawyer and Alex became a little bit of a, of a technician, a technician.

Andrey: So every product, every feature we work on, uh, we always work from, uh, from legal angle and from technical angle. So. That's what excites me. I, I, I've grown from being just a technical guy to be a guy who, uh, who [00:08:00] looks at the, uh, ideas and the products, uh, which build from the ideas holistically.

Mehmet: Yeah, fantastic.

Mehmet: Now let's talk more about. You know the the market right? So According, you know, like some researchers and you know, thank you for your team to you know, sending me all this So I had to you know, read and understand more about it Which is the real world tokenization a hot topic world street saying like it's a 30 trillion dollars opportunity So where exactly do you fit, you know in this growing market?

Mehmet: I don't know who would answer this Alex or Andrey one of you

Alex: Well, I would say, in my opinion, uh, it would be more capable to, like, topple it up, but from my personal perspective, for us, at least for the time being, the technization itself, uh, [00:09:00] is mostly rely on, uh, an actual utility, like real world utility that we perceive. Um, for example, in our particular case, we are looking into the, into the tokenization and RBA in particular, in a way that it would enhance current and existing practices in the Islamic finance, for example.

Alex: So we have in our turn, uh, the regulated gold token, which is essentially tokenized gold, according to the Sharia, I mean. There is always has to be, has to be an underlying asset in excess. So in our case, it means that every token can be, can be redempt into the actual gold at the first, at the first call of the, of the token holder.

Alex: So, and this actually goes even beyond, we are [00:10:00] building some of the products. In a way, by using the technization, by using the technization of the real, uh, of the real world assets and thus solving some legacy issues of the Islamic finances. Uh, in other instance of this, and I would say it's mostly, uh, the most close one to the actual life is that, uh, for example, Islamic banks, they usually limited in the ways how they can finance.

Alex: each other because of the sharia law. And they have something that is called the barook. It is a like a financial instrument, Islamic financial instrument, which essentially allows one bank to, uh, to give out the liquidity. To the other, to to, to loan the liquidity to the other bank. And it's been, uh, done with the actual commodities.

Alex: So I would not dive too much into the details, but essentially it looks like one bank [00:11:00] loans out or loans out the, the commodity to another. The second bank is actually izing with this commodity and the broker. So it gets the liquidity, do something that it has to do and then do it vice versa. So getting back the commodity and handling over the commodity back to the initial initial loan originator.

Alex: So, uh, and we actually enhancing this system by tokenizing those commodities. And then the whole process itself, the whole process, we are currently launching the pilot with one of the biggest brokers for the Tavaruk, I mean, the classical Tavaruk, so, and this, I would say, reflects our perception, our, our take on the actual tokenization of the world.

Alex: So the tokenization is wonderful. I mean, it has enormous, enormous opportunities, inherent opportunities. But we don't actually see it like if you [00:12:00] can tokenize everything you should tokenize everything, right? So it's a little bit of a it's a little bit of a I would say Inefficient approach because people are actually crazy about it.

Alex: Okay, we now can tokenize everything from from shares to the grocery stores Let's do it. So just because there is a way to do it. So I don't think that it's actually makes sense and We should start with some Actual examples, which can enhance the current procedure that we have already. So by these examples, we can set an actual landscape for other projects to see where the, where there is also an opportunities, where is it?

Alex: Because it's like a blue ocean. Yes. But you always should start by proving your concept actually makes the word world better place, if I can say so. So this pretty much, uh, this is pretty much my personal take on the,

Mehmet: on the Absolutely. It's interesting, Alex, because you mentioned gold, right? And, uh, [00:13:00] probably again, there might be some similarities between the concept of, of gold and, you know, saving the gold and, you know, the concept of blockchain and how we, we do it.

Mehmet: And because of course, like governments also, they have reserves of, uh, and, and so on. And the way it's, it's, it's like protected and so on. But if, if, and you just mentioned also like you can take it to anything, right. But if we want to be like kind of a realistic in what could be tokenized, Next, right. So what do you think are the assets that can be brought fast?

Mehmet: Maybe the question is for you both, like from, I would say, regulatory perspective and from technology perspective. Uh, like which one, maybe Andrey, if you can say from technology perspective, do you think like there is Something that we can bring faster than the other, I would just say maybe real estate versus, I don't know, maybe a traditional Sukuk, I don't know, or, uh, any other [00:14:00] financial instrument.

Mehmet: So how do you prioritize this in terms of easiness and also like, uh, putting it into the, into the hands of the market?

Andrey: Well, from technology perspective, the easiest asset to tokenize is, uh, the commodity. Uh, because, uh, like, like, like, like precious metals, not just gold, silver, palladium and others. Uh uh, so when there is a entity which, uh, holds these commodities and can provide, um, uh, trusted source of, uh, uh, this holdings.

Andrey: digital way, like an API. Uh, so, uh, tokenizing this commodity is just a matter of a very simple integration of the smart contract with this API. That's precisely how, uh, we tokenized, uh, gold. Tokenizing real estate is, uh, [00:15:00] very hard, but, uh, not from technological perspective, but, uh, from legal perspective and also Sharia perspective.

Andrey: For example. You own a share of, of an apartment, like, not you, but let's say some person owns a share of this apartment, then this person dies, and the private key gets lost with the death of this person. Who inherits, uh, his share? Because when Uh, it's not, uh, a matter of inheritance of this share. It's a matter of inheritance of the private key.

Andrey: And how do you inherit the private key if the private key is, uh, just, uh, was in the head of this person? Uh, there are some tricks, some legal tricks, uh, but districts, uh, end up with, uh, not recognizing, uh, not [00:16:00] recognizing the real. estate object itself, but, uh, some legal entity which owns this, uh, uh, real estate object.

Andrey: So, that's, in my opinion, that's, uh, two, the easiest and the hardest, uh, assets to, to connect.

Mehmet: Alex, do you want to add something to that?

Alex: From the Camus, uh, yeah, but only from the regulatory perspective. Sure. Because otherwise it will be, yeah, otherwise I will be stepping out, not in my territory. Uh, from the regulatory perspective, the technization vehicles are actually developed significantly for the past, like, I would say, two to three years.

Alex: You have some of the jurisdictions, especially in, uh, like, uh, continental Europe, uh, sorry, outside of the continental Europe. They have, uh, even the special purpose vehicles for that, now that you can create and Basically, whatever assets will be owned by the SSPV can be tokenized, consequently issued as tokens.

Alex: And, uh, they're like a huge, I would say, [00:17:00] variety. of different approaches to the tokenization itself. But still, up to this day, I would say there is, uh, very few examples of, like, the blanket regulations towards the tokenization because there are too many edge cases. Depending on the particular asset that you are trying to talk about.

Alex: And we see many attempts to actually regulate it once and for all through the blanket regulation. For example, like the MECA in Europe are actually addressing a lot of them. But Whenever we are talking about tokenizing, uh, some, uh, some financial instruments, the securities in particular, the MECA specifically draws the red line and say, no, this is not something that we regulate, even though we are regulating the whole crypto, but Not, but not financial, uh, financial instruments, which [00:18:00] are tokenized for this, you have to go to the MIFID.

Alex: So this is a different regulation. And it actually very, I would say, it's a very good example of how the regulators across the globe still struggling to come up with an idea whether there is, on one hand, they're grasping to this opportunity to have, uh, like a unified Unified regulation towards the tokenization,

Alex: please give us the clear regulation and everybody would play, would play the same rules and blah, blah, blah. But in reality, it's pretty much impossible because the, because of the, like the nature of the tokenization, because of the desire of the different groups to tokenize different assets, Uh, which are like very hard to, Shove into the same category and say like, yeah, this is your go to option if you want to tokenize it So I would say there is just several examples which are like got mostly [00:19:00] most close to that so for example the The Dubai regulation, I mean everything that we have under VARA They have a pretty good take on the tokenization itself.

Alex: I would say that there's still Practice will, uh, there's still, we're still lacking the practice for that. So from the practical perspective, there are not too many examples, even attempts to do that. However, on the, uh, on the other side, the central bank of the UAE, uh, also slowly, but steadily approaching this topic and.

Alex: I think that it would take another year or so, maybe two, when we will be at the point where we have enough examples for the tokenization that would help us to outline the current landscape and identify those blind spots, which we have to actually, like, uh, fill out with a practical perception of what we are doing here.

Alex: And [00:20:00] then Uh, the market will decide where the tokenization is mostly needed. Because once again, I don't think that we will end up in a world where you can and should tokenize everything. It's just It just doesn't work.

Mehmet: Doesn't work. Yeah. Um, and this brings, you know, a question, maybe a little bit technical to Andrey.

Mehmet: Uh, so from a technical perspective, um, we're talking about a very high regulated industry, right? But. I know that anyone in your position as a CTO would be eager, you know, to scale and, you know, make sure like, uh, everything is, you know, has the sense of, you know, innovation and moving fast. So what is the balance you do here to ensure, of course, the security that also, you know, regulations are observed?

Mehmet: [00:21:00] While, again, going full fledge on, you know, this innovation, especially you are in a area which is honestly speaking, I never thought about it from a defi slash uh, a blockchain perspective. So how do you do this, uh, this balance?

Andrey: Well, I believe my answer will be boring because, uh, , uh, some of the best, uh, technical.

Andrey: Processes are the most boring ones. So it's always about, um, the alignment again, between the technical, between the visions of the product architecture from the technical angle and the legal angle. So we, uh, we usually. Um, start with the, some high level technical design of the product, data flows, manual, logistic, et cetera, et cetera.

Andrey: We, [00:22:00] uh, uh, outlined it is in, in, in technical, but the, uh, in a technical form, but at the same time, the. easiest possible form, which still reflects the key point, which we then, uh, put through approvals of both legal side and sometimes, uh, Saria side. Uh, when, when it's approved, we, uh, when, when it's approved, we just go straight to the implementation when, uh, if it's not, then we brainstorm, we, we, we, we, we pick an ideas.

Andrey: Um, uh, um, uh, from legal and sorry guys, that, uh, okay, this cannot work like this. And we just, uh, brainstorm how, how, how to adjust this, uh, piece of the architecture in a way that, uh, it complies to the rules, but [00:23:00] uh, still fulfill, fulfills the product or feature purpose. So it's, it's just a matter of, uh, professional communication between departments.

Mehmet: That's right. Yeah. Uh, coming back to you, uh, Alex, because you just mentioned a few minutes ago, the central bank of UE and you've mentioned also like the regulations that we have it here in UE. I know like usually you today you're in Dubai, um, you know, visiting, but you know, usually. Um, you know, like also you, I think, correct me if I'm wrong, you operate the company from, from Hong Kong, right?

Mehmet: Oh from Dubai. From Dubai. Oh, so

Alex: Several companies, uh, one of them who is the technical developer, uh, the developer for the technical part of the Haqq network Like the contributor. Yeah, it's actually in Dubai. Yes

Mehmet: Okay, but do you, do you operate in, in Southeast Asia market also as well?

Alex: [00:24:00] Yes. Yeah.

Mehmet: Yeah, exactly.

Mehmet: So this is, this is the point I wanted to come to. So if I want to look at the different, so Southeast Asia compared to MENA region, and you know, uh, of course both are one of the strongest and, you know, like, uh, currently everyone's eye, uh, on, on these two regions from, you know, adoption perspective, but still, you know.

Mehmet: People call us the emerging markets, right? So what I wanted to understand from you based on, you know, what you're noticing from regulatory perspective and what, uh, you know, these bodies and, uh, you know, institutions, some of them also, they are government institutions. How are you seeing, you know, This making sure that this can be adopted not only by like, let's say government institutions, but also going mainstream to be adopted by everyone.

Mehmet: And, you know, both your view on the South Asia side versus Dubai and uh, You know broader MENA region. I want to understand, you [00:25:00] know, where do you see things are moving faster? Where do you see things are like a little bit slower both from adoption perspective and regulations perspective?

Andrey: Well, maybe I can start um how Well, how the blockchain, uh, the, uh, how, how the traditional GFI ecosystem was built.

Andrey: Uh, for example, the one of the largest, uh, pro uh, protocols on, on Ethereum, which is, uh, Ava, Ava is, uh, lending protocol. They did not even invent. Lending itself, they just looked at, uh, lending, uh, as it is in the traditional finance and they adopted it to blockchain and made it better. Uh, and it's, uh, the same for, uh, AMMs, such as, um, Uniswap, uh, Almost every bank provides, uh, uh, provides, uh, the exchange, uh, the, uh, the exchange service.

Andrey: So Uniswap [00:26:00] just made it better and removed the bank from, from the equation. So, um, how we look at the Sharia, we're also not trying to invent something completely new. Everything exists in, um, first. Everything already exists in Sharia law and it's a very well, uh, uh, uh, well, we're, uh, we're, uh, we're, we're, we're, uh, uh, uh, uh, uh, described, uh, in both the, uh, Quran and, uh, interpretations of Quran.

Andrey: Also there, there are already, um, Sharia compliant products, huge ones in the traditional finance and third there, there are, um. Uh, big players, uh, for example, in Indonesia, there are big players, uh, who get a lot of directions, uh, in the, in fields, uh, such as, uh, micro landing, [00:27:00] for example, in Indonesia, it's growing crazy.

Andrey: And Uh, what we're doing in one, one of the ecosystem players and Huck, they are just typing into this, uh, money flow in Indonesia. Uh, this, uh, player, this, this product is not, uh. It's not even opposing itself, uh, to, uh, to this, uh, web, to web, to products. Uh, we're just, uh, connecting the crypto, the blockchain, global liquidity to the Indonesian market.

Andrey: So we don't even need to crack our heads if, uh, if this product, uh, if this, uh, product will fly because the. Um, it already flies just without the crypto liquidity yet. We're just connecting crypto liquidity to this product. So that's how it is from my perspective.

Mehmet: Alex? Yep.

Alex: [00:28:00] Um, I would say it actually, there's too much of interference currently.

Alex: Uh, and I will elaborate on that in a way that, you see, it is very hard to, it's very hard to respond to the question where are like the market moving more quickly or where it's more developed when I would say if not half, probably some big portion of the current crypto market is just meme tokens and something that is very similar to it.

Alex: Um, I like the idea, I like this, uh, unofficial name of the Southeast Asia, the Southeast Asia in terms of crypto is like a sleeping giant. So previously, uh, it was referred only to Indonesia, but actually it works for, for the whole Southeast Asia because in one sense, the regulation there is a very fragmented, I [00:29:00] mean, besides the Singapore, I wouldn't say that it's.

Alex: Uh, and even in Singa, even, even in, in, uh, in the case of Singapore, it is like, uh, it is very highly elaborated. However, it is not very. Welcoming because it's a very high threshold, uh, it is, it's very complex and you many of the, many of the startups, I mean, they are struggling to enter the Singaporean markets that you decide, decide to go and structure through some other countries.

Alex: Uh, but we see some very good examples of how the countries, especially like the Indonesia, where we are very active and that we have a big community, how they are trying to, uh, how they're trying to catch up with the, with the, with the current. I would say pace of the regulatory efforts. And so they, uh, they propose a new regulations.

Alex: They introduced the new regulations for like a [00:30:00] bleeding edge, bleeding edge technologies in the Web3 and bleeding edge narratives in the Web3. So I would say that if we talk about the Southeast Asia, the exposure is

Andrey: huge

Alex: because in terms of like, uh, In terms of the people, how many there are crypto users and the holders and the active wallets, it's just enormous.

Alex: So when the volumes are, uh, very big, they, they are just ridiculously high. But if you look at the, like, at this particular market, what they're doing, it's mostly like buy and sell the MIM tokens. So not the DeFi, not some high utility dApps. So it's just still very, very early stage of the, uh, of the crypto usage.

Alex: Um, in terms of the MIM region, In its turn, uh, we see many [00:31:00] big players, many big guys, and especially if we're talking about the exchanges or some custodials and service providers in placing their headquarters, or at least their like significant branches here, because one of first and foremost, first and foremost, the regulation is.

Alex: pretty clear for them and they have a like a direct path, clear path, how to achieve, how to get the license, how to get regulated and actually Um, plays their business in this region. So secondly, we see how the big guys from other service, service, service provider industries, I would say they're also doing the same.

Alex: We see how the projects are trying, trying to get here regulated, be more present and working within the MENA region. So unlike in Southeast Asia, I would say that in numbers, it's much, uh, lower head count of [00:32:00] companies and actually. Holders, the population is much, uh, is much more humble rather than, uh, in the Southeast Asia, but they are, uh, they're relatively big.

Alex: So you have a fewer headcount, but much bigger, bigger checks would be bigger size of the companies that have been placed here. And that's actually work is actually reflects the situation with a, with a VEP to, with a VEP to businesses as well. Yeah. I mean, like the actual power of the Southeast Asia is that you have.

Alex: I have a very big, very big population. It's emerging, it's emerging markets. It's a growing economy as they are trying. So there's traveling with a, like to get the liquidity to get an actual funding because they have a, like, uh, The economy is growing and very, very fast, but they are struggling to get, uh, they're struggling to get an access for the liquidity.

Alex: And here's actually big chance for the DeFi space because unlike the traditional banks and the [00:33:00] traditional institutions, they have a much lower threshold to enter, uh, to enter the liquidity market. So pretty

Andrey: much, pretty

Alex: much

Andrey: like this. And these countries are highly digitalized. Every, almost every person has, uh, has at least an Android phone.

Mehmet: Right.

Andrey: Absolutely. The people, citizens there are, uh, not stuck in some legacy systems, uh, such as, uh, Checkbooks or even Visa MasterCard. Right. Even in Dubai, we use checkbooks, right? Sounds like from 20th century, right? And these people, they haven't even heard about them. They don't have Visa MasterCard.

Andrey: They just use phone for everything. And for crypto, you also just need phones.

Mehmet: And I think this is part of your mission also to do the what we call it in financial inclusion, [00:34:00] right? So more people who would be able to access these things that previously it wasn't possible, which is great. Now feel free, both of you to answer this, but I cannot.

Mehmet: Nowadays passed, uh, over an episode without asking about AI and I want to understand, you know, what AI plays a role with, you know, maybe with what you do at Haqqnetwork and, you know, of course, in the overall, uh, intersection between AI and, uh, you know, Web3 slash blockchain slash DeFi.

Andrey: In fact, we do have an AI division for almost a year now.

Andrey: And the pretty big division, we have a, uh, head of AI, uh, bright, uh, Muslim girl, uh, and the two AI engineers under her command, uh, [00:35:00] so she built a model. Which is capable of answering questions regarding the, uh, Sharia finance and some, uh, um, some questions about Sharia in general, uh, when you bring AI to Sharia.

Andrey: There are interesting challenges, uh, uh, uh, uh, uh, uh, uh, stand in our way. For example, the LLM models, even trade, even if trade trained by ourselves, they will always be biased or, uh, there will be a high chance to be terribly wrong because what models do, uh, what LLMs do, they generate the most probable, uh, answer, right?

Andrey: And, uh, When, uh, you touch religion. You don't want to be, uh, like [00:36:00] 95 percent right. You want to be 100 percent right. Um, so, uh, that's why you can't not just, uh, get chat GPT or open AI, uh, model trained on Quran or, and Quran interpretation and, uh, Built an UI around it and, uh, uh, presented a, a, uh, as a product, you need to build a lot of, uh, safety mechanism in the, uh, so building of the AI product for MAs, uh, becomes, uh, more than just, uh, machine learning, uh, task.

Andrey: It's, uh, a huge engineering task of building and

Andrey: a system. Um, with, uh, some, uh, new elements, um, also one more thing is, uh, you always have to provide references. Uh, to Quran [00:37:00] or, uh, tafsirs, which are, uh, interpretations of Quran, just in case if the response, uh, is still wrong, uh, user, uh, can always refer to the original source and check the response. So, um, we've already built the model and the chatbot, which is, which works in.

Andrey: Uh, one of our ecosystem products, it's called mm chat. It's like chat for Muslim people. And there is, there is a chatbot which answers this kind of questions. And another way we use AI is, um. Uh, to build, uh, a very simple user interface to our DeFi ecosystem. It's not live yet, uh, but it will be live, uh, throughout the, uh, spring.

Andrey: Um, it's very important for us, uh, [00:38:00] because we, uh, we don't appeal to crypto natives. I mean, uh, it's not our prime focus. Our prime focus is, uh, like normal people. On porting to, uh, Web3, and we don't want them to bother with the normal crypto stuff. Um, and we try hard to Eliminates, uh, hard parts of the crypto in our products, such as a mnemonic phrase, but while still keeping our products non custodial or, uh, uh, hard, complicated user interfaces, which, uh, ask, uh, user to sign some scary trans, uh, transactions.

Andrey: So here we are utilizing AI, which, uh, guides, uh, guides a person. Uh, through the, uh, DeFi landscape and helps the person to, uh, invest their money in a Sharia [00:39:00] compliant, uh, products, um, wisely and safely.

Mehmet: Just because you said this, uh, Andrey, like, and maybe you touched on this before, but do you think still, still people, when they hear the word Web3 DeFi, their mind, because Alex was talking about the, the meme coins and all what we saw, you know, couple even of days ago with this.

Mehmet: So do you think? You know, there's some education that I mean, not only for you, maybe anyone, any entrepreneur who is into into this field that they need to spend some time educating people about, you know, Guys, it's not about what you see. It's not about the meme coins that they, you know, they just drop and then they bust.

Mehmet: So How difficult is that for you? Like maybe Alex you can you can tap into this?

Alex: I don't know that it would be a very successful business model if you create AI which will consistently tell people don't buy meme coins [00:40:00] Why? Uh, well, first of all, I, I don't believe that AI can, uh, can feel any emotions, but I think in this particular case, even AI at some point will just give up until that, uh, there is nothing that I can do with these people.

Alex: They're still buying meme tokens. They still will be buying Vim tokens, no matter how, how elaborate, how patiently it will educate them to not do that. Uh, so, but actually in reality, uh, I mean, I adopted this, uh, idea, this perception that In not so distant future, the whole crypto market and maybe actually traditional finances as well will be just a bunch of AI agents communicating and working with each other.

Alex: So probably. When I think about the [00:41:00] current state of the AI and like the best way, the best approach for this is the AI most likely is the missing, this missing, missing puzzle for actual mass adoption, because let's be honest, if the crypto, the usage of the crypto was not like inherently connected with such many complex actions for such very Simple tasks, the adoption will be much, much higher.

Alex: We would be actually, probably somewhere, uh, somewhere around How many active Bitcoin wallets currently? It's like, uh, approximately 40, 40 million or something. So it would be Two times, three times bigger. So, the AI has a wonderful, wonderful, [00:42:00] um, opportunity, this, uh, magical opportunity to give an access for those who don't want or scared of learning the basics of the crypto to actually enter the market to benefit out of it.

Alex: So because we have all this different, uh, now it's booming, like all the AI agents, everybody is building an agent for everything. Like, uh, it's, it's, it's, it's kind of, it's kind of neat idea that you can just. Sub all those, uh, complex actions into just, uh, an AI and people will just order it, whatever they want to do.

Alex: So this is a, this is very lucrative, uh, and interesting, interesting topic of what is actually the best usage for the AI. But in my opinion, once again, it is. It actually erases this relatively high threshold of entering the market itself. So, but then again, [00:43:00] we are running the problem of like the trust. So because the AI agents have to be built by someone.

Alex: So in order for, for general audience, general market, general retail to actually trust the agent, they have to trust to the, to those who are doing that, uh, who actually publishes it or. Uh, deploys it is when we are talking about just like a informative, uh, function of the I like, yeah, the basic, the basic usage of the, for example, of the chat GPT is just to ask questions, gives you answer your, you ask him to compose some table or whatever.

Alex: So you're not actually instructing him. Hey, take my hundred dollars and go. Invest them into, I don't know, into Nasdaq. Yeah, because as soon as we would talk about these topics, when you're actually handing over your, uh, your money or your assets, whatever, [00:44:00] it would be absolutely another level of the discussion.

Alex: So there's still, it's still a distant future, but I don't think that it's. such distant. Most likely, we are actually relatively close to the state where the AI agent would be the, the first, I would say, like the market faced, the first frontier for newcomers into the crypto. So they would actually interact with whatever, whatever Web3 project through the AI agents, mostly without learning even the basics of the crypto.

Alex: But maybe If we're lucky, uh, they will be interested enough in learning those basics themselves. So, I think the future, the future in this sense is bright, but yet to be

Mehmet: determined. I agree. I, I, I, you know, I can, I can sense that, um, you know, of course it's bright, you know, always. I'm optimistic by, by nature, I would say, but, [00:45:00] uh, you know, the points that you mentioned that I think I agree with you.

Mehmet: We are not very far because the. The speed that these, uh, AI agents are in all aspects, not, not necessarily for crypto and Web3 applications, but, uh, the way they are developing, you know, and the speed they are coming up with definitely. Yeah, so I don't, of course, we don't have a crystal ball to say, yeah, exactly in this day, this will happen.

Mehmet: But yeah, the, the data and the numbers shows us, uh, that probably we are so close now. Before we close, um, and the question, which is an open question, I like to ask all my guests and again, Andrey and Alex, you know, feel free. So last thing you want to tell maybe entrepreneurs in, in, in this field, maybe final words of wisdom, maybe something that you want to highlight.

Mehmet: I didn't ask about. And then at the end. You know, how people can get engaged with [00:46:00] Haqq networks. So, each one of you, Andrey and Alex, like, you want to go and then we will close.

Andrey: Well, I would invite everyone to, uh, to, to, to, to learn, uh, at least a little bit about Sharia finance. Not just, not Sharia in general, Sharia finance. It's a huge opportunity and yet untapped, almost untapped, untapped. We tapped it a little bit, uh, I mean, in the, uh, uh, blockchain space. Um, in my opinion, Sharia finance is one of the, if not the most sustainable financial framework.

Andrey: Uh, there are a lot of cases, uh, or evidences of this. Uh, not a single, uh, Sharia, uh, bank, uh, went bankrupt in Africa, very unstable region. Uh, and, um, even in the U. S., um, uh, Sharia banking products, uh, are popular amongst non Muslims because of [00:47:00] the fact that they follow the Sharia rules. Uh, if, when you put your money Uh, in this, uh, for example, Islamic bank bank account, you can be sure that your money will not be lent out to, uh, someone else.

Andrey: So your money, uh, still there, um, and a lot of, uh, big startups and, uh, of unicorns are already, um, uh, competing to each other in Web2. Or even offline Sharia finance, but blockchain space is, uh, just a blue ocean. Even we, uh, in Haqq, uh, working on it, uh, for like almost three years already, we just stepped to very little, uh, part of it.

Andrey: So, uh, even if you're not a Muslim, but just an entrepreneur looking for ideas or, uh, markets without [00:48:00] competition. Consider Sharia finance and consider Sharia finance on blockchain.

Mehmet: Great. Uh, Alex, final words from your side.

Alex: My final words is that I don't know how to encourage people to, uh, web free people to drop, like, uh, the idea of squeezing out whatever you can squeeze out from, uh, from Meme Tokens. Once again, I feel like this podcast was very, was very, uh, hard on the meme tokens. But, uh, uh, in reality, I'm just very strongly advocating for long and sustainable.

Alex: products, which can actually make a change. So we should actually bring the benefit not only to the community, but to the industry in general, [00:49:00] by showing off that it's actually getting more mature and useful and purposeful. So Haqq is one of those. Haqq is one of those examples. We are not chasing and running for the, for the quick, uh, the quick returns or the quick buck.

Alex: Yes, we are trying to show that crypto is not necessarily about the quick profits.

Alex: Various communities, especially emerging markets to solve their everyday problems by not going bold and like saying that, okay. This, this network will be like the single, single, uh, stop shop for every need of every person. And yeah, the other, other layer ones, they are useless. Don't, don't even go there.

Alex: Don't do that. We are more of a, like a purposeful, uh, purposeful, like a system for specific, for specific industry, for specific market, for specific demographic, even, and people with a. Uh, with a unique approach to [00:50:00] the finances, uh, such as the Sharia, Sharia finances are, and I'm encouraging everybody to, to just go check it, check it themself.

Alex: As Andrey said here, we are very much aligned and actually to see that in the long run, it is much better to come up with a solution that will be self sustainable, the self sustainable economy, self sustainable development, because it would. Always bring in answers to the future questions that will arise as we go, as we develop, uh, as we develop the industry and moving it forward.

Alex: So, like, build. For people once again, not just for the sake of current narratives.

Mehmet: That's fantastic. And I think the website is Haqq. network. H A W Q. network. I will put that in the show notes. And by the way, Alex, don't feel sorry. I, [00:51:00] I had like previous episode talking about, uh, cryptos and. You know, like we were more harsh on meme coins.

Mehmet: Don't, don't worry about it. But yeah, of course. And you know, like part of it, and I'm happy with what you mentioned at the end, like being purposeful, it's about, you know, showing people the, the power of such technology and how you can apply it in something that, uh, you might not even think that it's possible.

Mehmet: And you guys, I think you did fantastic job, you know, getting it to the, uh, Islamic financing. Which is, you know, I think it adds also the confidence to a lot of people, to Andrey's point, you know, about like how people, even non Muslims, they trust, you know, investing their money over there. So thank you, both of you, for, you know, bringing this and talking about what you're doing and encouraging everyone.

Mehmet: As a startups as entrepreneurs and even as you know consumers of this technology to be involved So again, thank you very much. And this is for the [00:52:00] audience. This is how usually I end my podcast Episodes so guys if you just discovered us by luck. Thank you for passing by. I hope you enjoyed it if you did so Please subscribe and share to your friends and colleagues.

Mehmet: And if you are one of the people who keeps coming again, thank you for all your support because of what you are doing. And thank you for that. We managed to get for the first time since two years, we were getting in the top 200 charts every now and then, but for the first time, This year, Jan and Feb, uh, and even I think this will be aired in March now.

Mehmet: So we are getting in the top 200 chart in multiple countries simultaneously. So thank you for the support and thank you for making the CTO show the number. I would, I think it's 14 or 15 now, top 40 must listen podcast in Dubai. So thank you for your support as usual. And as I say, stay tuned for a new episode very soon.

Mehmet: Thank you. Bye bye. [00:53:00]