Episode link:
https://www.citizencosmos.space/tylerschmidt

Episode name:
Discussing Interfacing with nation states, UX as utility for people and Inherent risks of validating with Tyler Schmidt.

In this episode, Tyler Schmidt Co-Founder and business lead at Strangelove is interviewed. The secret's to good decision making and how to achieve true personal freedom are discussed. Tyler gives his philosophy on building and how his values have guided him. He tells us some of the projects that Strangelove is working on. The podcast also touches on the complexities of operating in regulatory frameworks in different nation states.

citizen_cosmos:
Hi everybody and welcome to a new episode of the Citizen Cosmos podcast. Today I have Tyler Schmidt with me today, twice today. I don't know why he's only once today, but he's here with me. And he is the co-founder of Strangelove. Tyler, hi.

tyler_schmidt:
Hey, Serj. Nice to meet you, man. It's wonderful to be here.

citizen_cosmos:
How are you man today? How's your day going so far?

tyler_schmidt:
So dude, I'm doing fantastic. And top line item that I have to discuss with you, there is a new cosmonaut on the way.

citizen_cosmos:
You're not gonna

tyler_schmidt:
I am.

citizen_cosmos:
believe it. You're not gonna believe it before you say it. Let me do it, let me do it. I'm gonna ruin

tyler_schmidt:
Yes,

citizen_cosmos:
it for you

tyler_schmidt:
yes.

citizen_cosmos:
because I had

tyler_schmidt:
Okay.

citizen_cosmos:
it prepared. You have a baby coming on. Congratulations, man. We did our

tyler_schmidt:
Yes.

citizen_cosmos:
homework. Woo! Woo! Yeah, good.

tyler_schmidt:
Hell yeah. You did your homework. Great.

citizen_cosmos:
Of course, of course.

tyler_schmidt:
Yeah. We're getting really excited. This is like the last thing that I'm probably going to do before I go off into paternity leave. The baby's coming on Monday. So. We have it scheduled. It's very orderly here in the United States and it's basically ready to go. So,

citizen_cosmos:
Nice.

tyler_schmidt:
you know, step one, we got to get the kids crypto portfolio in shape. I will, I will probably create my own wallet for him. Oh, it's a boy, by the way. That's also exciting. But yeah, we're going to get him some Atom and get a nice little nest egg for him so he can understand about, you know, the future of finance. All very important things for babies, you know.

citizen_cosmos:
I'm loving this. I'm loving this. Great. And what do you know the name already or not? Or is it a secret? I mean, this is

tyler_schmidt:
We are leaning towards calling the baby Owen,

tyler_schmidt:
which is not a family name. It basically he gets his own lease on life. We don't want to have too many like pre-existing states that are going to mess with them. We'd rather have a blank slate to work with. So.

citizen_cosmos:
long as you don't call him Do, that would be good

tyler_schmidt:
Yeah,

citizen_cosmos:
I think. D-O-Do is not a good name, neither is Kwon.

tyler_schmidt:
we can't

citizen_cosmos:
So,

tyler_schmidt:
name him Do. No. Well, you

citizen_cosmos:
no,

tyler_schmidt:
know, we

citizen_cosmos:
no,

tyler_schmidt:
were

citizen_cosmos:
no,

tyler_schmidt:
thinking

citizen_cosmos:
and Kwon

tyler_schmidt:
Kwon

citizen_cosmos:
also.

tyler_schmidt:
for the middle name. Yeah.

citizen_cosmos:
Well, congratulations. This is always happy to hear that people are feeling, you know, I'll say why I'm saying that because like for me, I know it sounds maybe a bit loud for a start of a podcast, but like, I know I've been in this space for like over 10 years to hope something changes. And I think when people are ready to have like two partners or three or five or whatever, ready to have offspring, right? Let's call it like that. I think that means they are feeling safe to do it, Like, yeah, that means something we're doing in this space, even though it's not to me in this case, but yourself is correct, right? So I don't know, that makes me happy. I don't know if it's probably too heavy i said it but yea

tyler_schmidt:
Yeah.

tyler_schmidt:
Well, you know, you're touching on a really good point here. And this is something that more of like lifestyle and then dealing with this industry that has a high amount of volatility and whipsaws you back and forth, a lot of that. But in order to make wise decisions in this space, you need to have security. One of the things that Jack and I always talked about when starting this business is starting it from a solid foundation and a solid base. And, you know, making sure that the bills are paid, you know, making sure that our tax liabilities are covered, making sure that we have no debt, things along those nature, just so that you can make the right decisions that you need to make, not out of desperation, not out of nervousness, but out of this is the right decision for the business, this is the way that we can bring more utility of the cosmos, like for our business and in a sense that's what we're trying to do. But you gotta be wise about that.

citizen_cosmos:
I'm glad you say that because, you know, I'm not meant to say that the validators and the crypto businesses and whatever, let's call them web three entities of today that are making money on web three. I'm not saying they're all white and fluffy by no means, but sometimes people underestimate the intensity in my opinion. And I know usually I'm on the different side. This is for all the probably listeners to share. Usually I'm kind of like a bit more critical to that. But I think what you're saying, you know, about the business and that you're creating jobs and that those jobs are also people that have lives and they also have responsibilities. And then their turn, they're caring for somebody, you know, and like even a small validator employees, you know, between two to four people somewhere, right? A small like content creator employees, like one to three people, like an average with talking like up to 10, 15 and so on and so forth. Like all together down the line. That's a lot of people that are and I'm glad that you say that because this is what, Oh, why do people hate Do Kwon so much? People don't hate Do Kwon. There's nothing wrong with Do Kwon. But what

tyler_schmidt:
Yeah.

citizen_cosmos:
was wrong was the promises, the false promises that he did. And.

tyler_schmidt:
Yep. So I want to, I want to zoom in on a piece and a point in time and strange love where we had this really critical decision to make. Um, we were, this is like, uh, late 2019. Um, we had made some really good investments in the, in the Akash network amongst others. Uh, we're running a validator for Akash and we're doing really well with our validator business. And we're basically making venture capital investments at the same time. This is like strange love. 1.0. We're like just a validator. We're just making venture. We had sit there and go we want to do more Jack and I have always wanted to do more and we've wanted to bring core product offerings to the space and make more impact than just venture. We want to build like that's basically the summation of it. If we if we need to build we got to get a team and our portfolio was, you know, vast majority of it is crypto assets. You know, we didn't have a lot that's like sitting in USD in a bank account at the time. So we said to ourselves, like, we got to make a business that can gainfully employ people and do that for a long period of time. And that's a pretty big pivot considering how most of our assets were sitting in crypto. And like with all the volatility, all the drawdowns, we had to sit there and say, we need to manage a company that can operate on 10% of what our war chest of operating budget currently is. So we look at this and we say, cool, can we operate with 10% of that? Good. Okay. Now we can make the decision to move forward with this and de-risk the business in some ways and feel more comfortable operating a business in this tumultuous space. Um, and I gotta give credit to my validators out there. Um, a validator sounds like a stable business, right? It's like, cool, I'm running these machines and I'm getting tokens based on staking percentages and. rewards and commissions and all that. But it's really not because you are entirely at the mercy of the tokenomics or the token price and what happens there. And then of course, if you want to liquidate any of those assets, you have to go through a liquidation event on some Dex. You may move the scales of that Dex in an unfavorable way. I've had to be on the sell side of trades for a number of times that I haven't had wanted to. necessarily move the price in the way I did, but I'm paying operational costs. So there's a lot of these sort of risks inherent in doing something that sounds as stable as operating a validator when in reality, we're starting to look at validator operations more as a venture bet, where people come to us and they say, hey, I want you to come and validate on our chain. You're a reputable validator, we'd really love to have you. And we say, we really gotta look at what you guys are doing. and make sure that we agree with your guys mission. You know, you guys have the opsec in place or you know, whatever the parameters are of this engagement. We need to feel good about it. And that's much more of a venture style decision than it is like a, yeah, let's just use some DevOps and turn a couple of switches and get this thing running. Because a lot of the, yeah, it's not that simple. You know, you gotta, you know, cover your costs. And sometimes a lot of these... When you do the research and you look at these chains, it turns out that there are a small percentage of chains that make most of the money for validators. And there's a larger percentage of chains that don't necessarily turn a profit just based on your rate of return alone. You're going to need to see price action and price action in the token in o rder to gain some kind of, I don't know, just a good gain on your investment there. So, yeah, it's. definitely a business that has lots of inherent risk. And what we've been trying to do is be as defensive as we can and create a stable of a business as we can so that we can employ humans. And we chose to play the game on the absolute hard mode setting by incorporating a business inside the United States. And in the world of crypto, very hard. uh, with the regular regulatory landscape and, uh, the tax landscape very hard. Um, but I'd love to zoom in on another piece of the strange love story that I think was really interesting and that was just cool. We're Genesis validator on the Cosmos blockchain. This is really exciting. Uh, and at that time it was really cool. Uh, I was there with Jack when we stood up the validator, uh, and we, we did it together, we exchanged all the private keys and got our, our op sec in place for that. Um, but really exciting. Um, Oh man. Um, but, uh, at that time, uh, we needed to figure out how we're going to declare all these assets, declare our income and provide books to give to the powers that be the United States government. Cause you know, if I was in Laos or if I was in, um, in. Puerto Rico or Lisbon, you know, I may not have the same regulatory compliance, but in the US, we got to declare all of our tokens, you know, and get cost basis for all of them right when it happens. So one of the first things that we had to do is come up with spreadsheets that were tax reporting. And Jack came up with a really great method for pulling this data directly from the blockchain. So we really just ran queries. on the blockchain and then populated that data into a spreadsheet. And at that moment when Jack was like, I think I know how to do this. And he goes ahead and does it and then gets back to me and he's like, here's the spreadsheet. I got, you know, the exact timestamp for when the tokens landed in our wallet. I got, you know, date, I got everything broken out like by the second, you know, hyper, detail, more detailed than, than the regulators could possibly ask for. I sat there and I said, wow, this is a business. You know, and that was just a really powerful point in strange love's life when it was just, you know, two best friends having a lot of fun. And pretty soon it's like, great. We make enough money that we can declare that to the, to the government, pay it. And we have a real business. So that was another exciting piece of the strange love story. And again, doubling down on security, the business is crazy enough on its own. We need reliability in the space. And that's a lot of what we try to bring.

citizen_cosmos:
And, you know, as listening to this, like to reflect as a validator, just like myself, to say, hey, you even, you haven't even spoken when you were saying that about the road to Fiat. Cause unfortunately, sometimes you need Fiat. Even if you're trying to operate the most Web3 in the world validator, you still will come across it. And, you know, you were talking about this hard route and I was thinking, ah, he hasn't even mentioned Fiat, has he? I was like, whoa, but because

citizen_cosmos:
sometimes you're like, damn. I wanted to go a different question because this is just a comment, but the second thing that I want to reflect on, this is more interesting in my opinion, and I want to know your opinion on this too. The second thing you said was to me very interesting, and you started to talk about the US government and about running the Validator, and I understand where you're coming from, but I want to ask you this, how or what do you think or how do you think should a person decide on which leverages to pull cause in my opinion there is two leverages. There is like the game, the business, right? And then there is the values and the philosophy, right? And like sometimes those two things are just not in gear with each other, right? They just don't run. So like, I mean, here, because you're talking about, you know, we need the business, but then there is, but we want to build this business in the decentralized way and want to prove to people that this can work. But Damn it, here's the US government saying, no, no, no, no, no, no, no, whatever you do, you're going to do it our way. So we have to say values down business up. So at which point, like, how do we do this? How do we level that out? What's the golden answer here?

tyler_schmidt:
I love this question. You know, I say that Jack and I are definitely from the early class of crypto people, where I was investing in Bitcoin in like 2012 and 2013, was really interested by all the ideas of an open and transparent global currency. And what and you know, Bitcoin has evolved over time. What the narrative of Bitcoin has shifted. but I'm still really interested in some of those core fundamental ideas. And I think, you know, you have to, you have to at least interface with like the, you know, global currency, global financial instruments, ideas to be passionate about the space and the way that we are. And we really believe that we're building something better, but Jack and I are also pragmatists. And this kind of just goes back to like, we've been playing games together of all sorts for a number of years. And you got to be a you got to be pragmatic. You know, like we really wanted to do something that exists within the United States of America. We love being Americans for better or worse. You know, I don't think that they're at the at the absolute cutting edge on regulatory compliance. I think there's a lot that can be improved upon there. But. We really need to work within where our national and where we work. So, you know, there's, there's a side of me that wants to be like, oh, the federal reserve, how dare you? And like, I philosophically, you know, don't agree with that, but, um, you know, that's the system we're in. And, uh, it works in America, uh, for, for now, and we have to play around with nation states. So I think at a fundamental level, you have to understand that. these global protocols aren't just gonna replace everything. They're still gonna be nation states and we're still gonna need an interface with nation states. So I've wanted to try and pragmatically make sure that interface between these global protocols and nation states is seamless or it works as well as it can. Basically because I've been paying taxes for since I was young, don't. No one likes it. Um, but I think it's also a headache. Um, you know, the way that the U S government has it done. And I think, you know, we have this amazing distributed ledger technology that tracks all of my transactions. Why is this not automated? You know, so one of the problems that I would love to continue working on at strange love is automating some of this process for compliance with nation states. Um, I'm a bit more of a, uh, of that position of I would like to work with nation states. I think nation states are still a good thing. And that may not be everything, everyone in the world, people can disagree with me on this. And I really accept those discussions too. I'd love to see where we can have global protocols that usurp nation states in many ways. IBC, I would love for IBC to become the primary communication protocol for finance. That would be wonderful. We can replace Swift. Good, get rid of it. You know, so but you have to strike a balance Um, it just if you want to Do things at the scale that strange love is doing Um, you need to comply with nation states If you want to employ people and you want to pay them in a local currency that they can use You've got to work with nation states Um, we could go full pirate route, you know, and that that's another valid strategy that we could have done We could have said We are gonna incorporate offshore, we're gonna keep all of our holdings in crypto, we're gonna pay all of our employees in crypto and leave it up to them to convert. But I felt like that wouldn't provide enough security for the employees that we wanna have work with us on a long-term basis. We really wanna hire people and keep them and have them grow with the company. And getting paid in your local currency is one way that I think it benefits from that. And not everyone on our team wants local currency. We pay people in USDC. We pay people in other cryptocurrencies, mainly USDC. So it's more of a mix these days than just inside the US, but also we employ people around the planet now too, which is really exciting. My team actually, a majority of them work out of Indonesia and we have a really dope front end team full of absolute ninjas. And I found them through my man, Griko, who was just in the same coding groups that some of my other colleagues were in. And you just make a global connection like that. You ask for his friends, his friends ask for their friends. And if word gets around that you have a good thing going, people wanna work with you.

citizen_cosmos:
I was just going to say that to me, like the bottom philosophical, like debates always ends in, you know, like I am kind of on the other side, you know, on that pirate side, I guess. But to me, the bottom line here is very simple. The decentralized world, the decentralized philosophy is decentralized. If somebody wants to have a nation state, you cannot call, you cannot think that you are pretending that you want to build decentralization if you say let's kill the nation states because that's

citizen_cosmos:
not the centralized because the decentralization is about the freedom of choice So

tyler_schmidt:
Mm-hmm.

citizen_cosmos:
so is like the whole essence, you know of the word anarchy It's about freedom of choice about having the freedom to do what you want to do So that means whether it is the banking system where it is Bitcoin whether it is atom whether it is I don't know dog or whatever Dodge sorry, but it's up to to to the to the community to decide what they want so i totally agree with you tho. Here is a questions for you more in your direction, I guess,

citizen_cosmos:
with the line of thought. So I know that you love UX. I know that. I

tyler_schmidt:
Mm-hmm.

citizen_cosmos:
know that you've worked for several companies, big names, including Harley-Davidson, for God's sake. That was impressive, PayPal. And I was like, this dude really went through all of them,

citizen_cosmos:
So two questions, and I'm going to go one by one, let you answer why in your opinion is UX so important? That's the first question.

tyler_schmidt:
UX, I have a very simple answer for you. UX is the best way to provide utility to people. It's the best way to take something that's a piece of technology and distribute that so that people can get an advantage out of utilizing that technology. And that's what it's all about. When I was in school, I studied economics and philosophy. And I studied economics to figure out how the world worked. And I studied philosophy to figure it out. what I really wanted to do to make an impact in the world. And I came on this combination of, oh, the economic concept of utility. There's actually a metric that you can track that is like the amount of benefit that this good or service provides to people. I thought, that's really interesting. I'd love to do a philosophical essay on what utility is and what its meaning is. I was like, cool, that sounds great. So I started delving into that and then, you know. through logic of reasoning, I've always been interested in technology and tech. I've always wanted to work in tech. So the ability to widely distribute technology to every member of the population through mobile leapfrogging and the amount of digital access that exists in the world today is really phenomenal. So if I want to generate the most amount of utility for the most amount of people in the world with my one life on this planet, UX seems like a good place. You could say stuff like software engineering at large is that, but I didn't really go down the software engineering path. I was a bit more soft skills. I tried my hand at coding, but I just got kind of bored coding. I got a little frustrated with it and I still code. I can publish websites and stuff, but it's just never drawn to me the same way that design or human factors has. And I've gotten a lot of enjoyment out of it over the years. But yeah, it's all about utility, dude. That's what it's all about.

citizen_cosmos:
It's amazing that you say that because the next question related to that is, do you think that adoption can be the result of that? Would you say, let's go higher? Usually adoption for any tech happens on the application level. It's very rare that it happens anywhere else, whether it's AOL, whether it's HTTP, those are all applications. This is not bottom line. Usually the UX, whatever you pronounce, however we pronounce it correctly, it happens on that So does that mean that UX and adoption are directly correlated?

tyler_schmidt:
Oh yeah. Oh yeah.

citizen_cosmos:
Okay.

tyler_schmidt:
Um, I, okay. So a good technology does not necessarily make a good product. And that's something that I believe you can have absolute banger, hot fire, amazing latency, you know, low packet, like, you know, low data packet transfer protocol, whatever you have. Um, but if it's not gaining usage, If it doesn't have all of the affordances in place to make it easy to pick up and use, it may not be a complete product. The usability side of it is what completes that equation and turns a technology into a cohesive product. So for me, UX is absolutely necessary. And I think it's true on all products, including stuff that may be more backend or more... Just a test suite. OK, let's use an example. Interchain test, one of the test suite that Strangelove just built for the Interchain. It's a great product. And if you want to set up an IBC native chain, I would absolutely recommend using it. It has developer experience. We look at how the developer is putting in their tests and making sure that those tests are very good. And that is a form of UX. We call it developer experience, but it is also UX. So making sure that that's easy to use, that the command line tooling has good prompts, you have a good help section, the prompts take you where you need to go, all that's really important. So even stuff that's back in focus still has UX implications that make it a better or worse product. But when it comes to the app adoption level, that you see a lot of times, you know, you can hide, you can hide subpar technology behind a really good and clean user experience and still do okay, I believe is, you know.

citizen_cosmos:
I think we mentioned one at the beginning of this podcast already, one example. I let people fantasize, I'm not going to say, if they want to go back 20 minutes, back to the naming of the baby, that could actually remind them of you. Just

tyler_schmidt:
Yes.

citizen_cosmos:
saying.

tyler_schmidt:
Yeah.

citizen_cosmos:
But, man, I kind of agree, but there is still a part of me that screams, but damn what about all the infrastructure I mean, I'm gonna be my own devil's advocate here and say, well, but then you could apply the same laws to the infrastructure, right? And this is what I'm trying to get at not not

tyler_schmidt:
Yeah.

tyler_schmidt:
well, like could the infrastructure stack be better? Like where can we make it so that, like Ignite is really cool. Like I love Ignite, I got some great demos on building your own blockchain at Ignite. A lot of that experience is the usability and user experience of working with the command line to stand up your own blockchain. And it's a really good product because it has all these good user affordances in place. If you don't have them, the Cosmos SDK is still fire. You know, Cosmos is still really great. And, you know, I think like you look at you look at something like Atom and the hub and you think honestly still pretty good product on its own, you know, and where are the usability pieces there? start with the wallet strings. You start with the fact that the wallet string has Cosmos at the beginning of the string to denominate what chain you're on. That was a user experience choice that the developers made that was really smart. And little things like that are where you improve the quality of a product to support an underlying infrastructure that's super rad.

citizen_cosmos:
Definitely, definitely. And I think you can even take it much further than that, right? To do people design. But what about you mentioned Cosmos yourself? And then you already started to talk about it, because it was obviously obvious, like the next obvious, sorry, logical question. UX in Cosmos. Where are we? In your opinion, of course, what do we need to do to improve it? Do we need to improve it? Let's go. Like, I

tyler_schmidt:
Yeah,

citizen_cosmos:
mean, what are we doing?

tyler_schmidt:
I think we're at the infant stage. So, um, I would love for some of my friends over at Galileo to like debate me on this. Um, I think that we've been focusing on infrastructure for a number of years. Um, what is now coming out is the application boom. So we're starting to see applications come out with real use cases, you know, quasars coming out really excited about quasar Mars protocol. really cool user facing product. So we're starting to see user facing products break through and start to gain adoption. I'm really excited about this phase. I feel like this is just the beginning. There still aren't, I guess, one thing that I think is a value in Strangelove is we take web two practices and bring them into web three, like the good stuff. You know, we leave the bad stuff, but like we pick up some of the good stuff. You know, Golang is really great. Kubernetes is really great. Cloud managed infrastructure is really great. You know, some of those things are really fantastic. But so. Uh, where is that now you're seeing a lot of app chains come in, come in, and it's getting really exciting. And we're going to see a wide amount of competition to see what use cases make the most sense. Um, what I'm very interested in is, is this going to be a website that I go to in a browser that then has a Dex or it has a lending protocol or a yield, a yield farming strategy or an NFT protocol. Like what are the services that I'm going to receive at a website layer? Now, what are the services that I'm gonna receive at a wallet layer? And where is that wallet going to exist? Is that going to exist in the browser as a Chrome extension? Is it going to exist on a phone? Is it going to have a seamless handoff between a browser and a phone? Is it a desktop app? Or is it all of these? I think a lot of these are still questions that we need to find a winner. For some of these so I would say the space is very liquid right now We're still searching for a lot of the best solutions. I'm incredibly interested in brave browser, by the way I feel like user basically we need to figure out where the motes are and where there are users So the motes are mainly around browsers right now They're kind of around wallet extensions and exchanges as well Like a big mode of user acquisition is like Coinbase or Kraken, you know Like those are big places where lots of users interact. And that's gonna change, and we're gonna get more decentralized solutions and things like that down the way. So I think that we are starting to see improvements in UX and user-facing applications, but this is really just the beginning, and we're gonna see a lot more. Yeah.

citizen_cosmos:
Do you think there is anything in particular apart from, I mean, you mentioned already, hashes the strings, sorry, the strings of the wallets. And you mentioned already the beginning of the string begins with the chain ID, right? What other examples of something fascinating in your opinion that is different actually from the way the interchange does it to the way, let's say, I was gonna say web two, but it was a Freudian slip because I wasn't

tyler_schmidt:
Mm-hmm.

citizen_cosmos:
referring to that I was referring to crypto 2.0. And to kind

tyler_schmidt:
less.

citizen_cosmos:
But yeah, do you think that the Cosmos ecosystem has got something in particular unique in terms of UX design that attracts people apart? Well, I'm not going to say anything, so

tyler_schmidt:
Yeah,

citizen_cosmos:
I would let you.

tyler_schmidt:
I've got two. I've got two for you. So one's a simple one and one's a bit more nuanced. Simple one is IBC transfer. IBC transfers are fucking great. They're low cost, then it's moving something from one address to another chain. I use IBC transfer all the time when I'm just like. Moving money to you know, I want to check out this yield farming protocol cool. I'll transfer some tokens from here to there And that's a really cool piece of ux and that allows for All kinds of things to be built on top of that um, I think um, I forgot the quick term for it, but basically when you Lose money on a chain when you have no money in a wallet and you need gas fees to pay to pay To transact to move all the all the money out of that location You know, that's something that I would love to see an improvement on where, oh no, I'm out of gas. Here we can do an IBC transfer to get you the gas that you need to finalize this transaction and clear out your wallet and move it with zero dust. That's the kind of UX improvement that I'd like to see happen in the Cosmos ecosystem and we can potentially build that here at Strange Love.

citizen_cosmos:
I don't think it's very difficult. I mean, I'm not sure about atom, sorry to cut

tyler_schmidt:
Yeah.

citizen_cosmos:
in there, but if we're talking Cosmwasm, you could technically go to any pool or any multi-sig, loan it from there and then put it back within the next block already, right? I mean, it's like a flash loan to pay the gas kind of thing.

tyler_schmidt:
Yeah, yeah, that seems very reasonable. So that's just some stuff that I would love to see more of. I think the other thing that's interesting is just how decentralized this ecosystem is, the fact that you don't necessarily need to use the entire Cosmos SDK in order to be a Cosmos ecosystem chain. I mean, you can look at chains like Penumbra. that don't use very much of the Cosmos SDK, but use IBC. And the fact that it's basically, it's very decentralized and allows for people to build what they truly want to build, be it a sovereign app chain or what have you. But that amount of composability is something that I really respect in the Cosmos ecosystem.

citizen_cosmos:
Pardon me, the unmute button. I was always saying that my wish, as of, I always say that, I keep repeating that, but I will say it again, my

tyler_schmidt:
Mm-hmm.

citizen_cosmos:
wish as partially podcaster is to have a new design for the unmute button because the way it's designed now, people forget about it all the time, including myself. Just complaining.

tyler_schmidt:
Yeah.

citizen_cosmos:
But to move on to a slightly different topic, yet still in my opinion, incorporating a lot of UX in it And I think you will understand why I'm saying that, I mean, crypto asset management. And this is something that, I mean, you already touched on about the baby, right? And you touched on it about the business. Some of it was a bit humorous, but it's not. It's got both sides to it, right? Every joke has only part joke.

tyler_schmidt:
Mm-hmm. Yeah.

citizen_cosmos:
So what do people, what should I'm going to ask, like the most obvious question, but feel free to like kind of dig it in a little bit. And I will try to follow up with something more interesting. But the most obvious question here that arises is considering the state of Web3 today, and I'm not talking about specifically where the market is. I'm talking about the uncertainty, the instability, and at all, not just the Web3 market, even like Elon Mem, that was a good one. Elon Musk posted a meme recently.

tyler_schmidt:
Yeah.

citizen_cosmos:
You know about like put your money in the banks now banks are scams put in crypto put money in cryptos crypto is scam So we're coming like to the crypto asset management question What on earth do people do like where do we go do they go left do they go right? What's what's what's what's to choose? What's the what's the 101?

tyler_schmidt:
You know, we are reaching the point where crypto has a beta that is correlated to macroeconomic markets. You can't deny that any longer. It used to be that was a weaker correlation and they kind of moved a little bit differently. As this market has been maturing, I'm seeing closer and closer correlation between macro and crypto. It's not always there. And in interesting times like the recent Silicon Valley Bank collapse, we're seeing that crypto didn't really dip too drastically with that. And in fact, you know, rallied a bit. I think Bitcoin rallied a bit off of that. You know, but when you have a beta that is more closely tied to the major macroeconomic conditions, you realize that there is no safe harbor. I don't think that there currently is a safe harbor. But I will say that cryptocurrency assets are revalidating themselves when it comes to, oh, I would love a bank that just held my assets and did nothing with them and didn't try and do some form of hedging or front running or, you know, do some yield management strategy on top of the assets that they take in. I think people are finding that to be more compelling than they have in a long time because of what these banks are doing. And like, you know, you can say, is it the bank's fault? Is it not the bank's fault? I don't really need to debate that. I mean, I think that, you know, SVB made some poor choices on some long-term bond purchases, but you know, they probably had imperfect information at the time. So I don't think it's entirely their fault. But it also shows that like a bank. used to be a place where you've assumed you would get your money back. But what we know from Bitcoin and the 2008 recession and the reason why Bitcoin was built in the first place is like, we don't fully trust these institutions. They can fail. And they do weird stuff with our money. So the, the thesis for crypto is as strong as it's ever, it ever has been in my mind. And just validates the fact that we need to have multiple places to store our money. Now. To answer your question, I'm a big fan of diversification. I love index funds. I love diversified risk. So the smartest thing that I do is we break our money up and distribute it amongst as many different places as possible. And we wanna have an even balance of fiat cash to crypto. And so far that's been working out for us pretty well.

citizen_cosmos:
That's good, man, because it seems that sometimes the only opportunity, like you say, to put your money in a bank that isn't going to go and find extra yield on top of it today in crypto seems the only, and I don't want to like advertise here, but I'm going to say the name, of course, because I don't know any other examples. We're going to liquidity, LUSD, Ethereum, right? Because the only thing, but the reason for it is because they remove the people.

tyler_schmidt:
Mm-hmm.

citizen_cosmos:
So it seems whenever there is money and people involved, unless you remove the people, always somebody is gonna look for something else, right? So this is kind of, I guess, a problem.

tyler_schmidt:
Yeah, yeah. Yeah, it's a bit of a problem, but people are going to try and find innovative ways to manage money. So I think it's sort of a blessing and a curse. I may find a bank that I really like down the road that does yield farming strategies and fiat for me that may resemble what we have on Osmosis or Mars Protocol. Maybe the traditional banking sector starts to emulate some of the things that crypto does. And I wouldn't be surprised if that happens more and more assuming that the regulations allow for that to happen. The regs are pretty strict, but I would love to see more crypto influencing traditional banking.

citizen_cosmos:
I think this is the perfect point to say this because usually, you know, I make notes of the speaker and as we go, I go, I look at them and I'm like, it's not always an order. And I think this is the perfect place to ask you about that. So here is what's on the top of your Twitter, right? Your knowledge is your freedom. So is that what you mean by that sentence? Your knowledge is your freedom by being able to, if you know that your money is your bank, sorry, isn't lending out your money, then you know you can get it back. Is that what you mean by that sentence or my overreacting here?

tyler_schmidt:
Um, uh, I don't think it's like as detailed to, uh, the banking sector. Uh, it's much more around when you're a kid and you're looking at the world and you have school and you know, school is can be fun, school can also suck. Um, but you need to learn stuff and then you need to learn the building blocks of stuff so that you can learn more advanced things that will then impact the world. What you want to do is very indicative of what you know. So the options and opportunities that present themselves to you are very much based on what your knowledge is. And if you don't know the way the banking sector manages your money, you may make a bad decision with the bank, you know, I mean, as one example, but it's more around like, you know, what do I want to do with my time? You know, I want to create the most utility for average people that I possibly can. So how do I do that? I learn how the Cosmos SDK works. I learn how front-end works. I learn what the authorization mechanisms are and who the best providers are for authorization and private seed storage. That's currently Wallet Connect, for example. But the knowledge that you have equates to the choices that you can make. So it truly is about personal freedom. I'd say more so even than like what's in your bank account. If you know how to write a website that's a whole other type of freedom.

citizen_cosmos:
definitely, definitely. It's about what I'm just to say about wallet connect. I mean, this podcast obviously isn't gonna come out like soon soon in terms of the way we do production. But I think one that will definitely come out before it because it's already close to the coming up is actually wallet connect and Pedro and the guys if you listen to this, just from what follow Tyler and listen to also fascinating. So sorry for the second of advertisement there. But

tyler_schmidt:
Oh no, go ahead.

citizen_cosmos:
Tyler, there is something interesting on your website that I found that I want to ask you about that is related to freedom, I guess, and to UX. And I was opening up before just to see it. And you're talking here about, well, in my opinion, it's probably one of the main topics that we kind of try to touch on in our podcast. I'm going to read this here. I believe design is a method of human improvement true happiness is achieved through excellence and virtue. a balanced life propogates freedom and emotional calm, creativity equals past experience plus new information. This is interesting. I want to talk a little bit about that. So basically balanced lives equals freedom or is that what you're trying to say? Am I

tyler_schmidt:
Yeah,

citizen_cosmos:
getting you correct

tyler_schmidt:
yeah.

citizen_cosmos:
here?

tyler_schmidt:
So when you cover all your bases, when you have a life that has enough work in it to feel like it's sustaining you and enough recovery time to recover for the pieces that you have and work, to me, that is a form of freedom. Things like creating habits and then setting an intention with your day. They're all really important building blocks of doing anything in the world. So if you want freedom, discipline is a way to provide freedom is another way to say that. And I'm not super disciplined, but I have a very regular cadence of what I do, like when I go to bed, when I get up, the types of stuff that I like to eat during the day, all very consistent. And that's so that I can put the work in where I need to work on a day-to-day basis. So balance is super essential and this kind of goes to everything we've been talking about like crypto is crazy It's fast-paced a lot of stuff happens hacks happen all the time. It doesn't feel like there's ever a slow news day So for me if I want to work in the sector, I need to make sure that my personal life is like almost that of a monk where you know, I have very little things that go on and You know, this is probably I'm probably different than some of your guests. I actually sleep a lot. And that's something that I programmed into my life. So this idea of balance, it's key. I sleep well so I can make better decisions without sleep deprivation. And also, this may change very soon as young Owen enters the picture. So sleep may be a very different, differing piece of my equation soon. But all of these things are building blocks to make the right decisions. And that comes down to like, what does Strangelove wanna build? Are we making the right choices to build things that can impact the Cosmos community and thus the greater ecosystem and users for the better? I sleep a lot so I can make good decisions. Simple as that.

citizen_cosmos:
I love that because I sleep a lot as well. Just to say that, you know, so guys, I sleep a lot.

tyler_schmidt:
Good,

citizen_cosmos:
Thank you

tyler_schmidt:
good,

citizen_cosmos:
very much. I love

tyler_schmidt:
good.

citizen_cosmos:
sleeping. In fact, lately I've been kicking myself because I told myself to sleep too much. And because I had this long period and now I've been like, I need to get out. I need to stop sleeping. But like you touched on it as well. Just a second ago about Strangelove building outside of Cosmos. I like that. This was my kind of like next point that I wanted to get at. If we were to zoom out from the philosophy, right, but to kind of like, I don't know, just to zoom out from the talk about motivation and stuff and talk about the reality of what Strangelove has already built. What I want to ask, and what I try to ask and what I try to ask all founders Co-Founderst rarely other people because its more related to that. Are you internally currently like satisfied with what you guys have already built in Strangelove? And do you think that that what you are doing in Strangelove, in Strangelove, sorry, actually helps people, we kind of talked about the money and the wages, but outside of that helps people to get to a world which you yourself want to see, like you came to this industry for a reason. And it's obviously not because you want to get rich right, because you have been here since 2011 and you've stuck through a lot of, so I think you understand the question, like are you, do you think that that Strangelove is contributing to that future that you have saw some time ago to come to this industry?

tyler_schmidt:
This is a great question. I'm incredibly proud of where Strangelove's at. I think the biggest thing that I saw that was a proof of the impact we're making is the Cosmos forum post where I believe Litbit recommended that Strangelove be the core maintainer of the IBC Go Relayer on the Cosmos Hub. We were like, whoa. And that was a little bit of a surprise for us. That didn't come from us. We had no say or influence in that post. But I was very honored to be brought up in that way. And because we're doing a lot of really good work on the Go Relayer, we're constantly maintaining it. And it's just a really cool piece of tech. I'm very proud of that. I'm very proud of the Horcrux tool that Jack designed. uh, you know, for sharding validator keys. I think that's another good piece of work. Um, and. We, uh, I'm proud of what we built and I think we can build a lot more. I really think that there's a lot more that we can continue to build. Um, we have a lot of API style data availability services on the backend that, uh, that we're bringing into market right now. And that's just like, do you want any, um, any transaction data for any blockchain inside the inner chain. We can pull it for you with very low latency. But another piece of this that I'm very focused on is Strangelove's internal wallet project. We're currently building a wallet. It's in the process of moving forward right now. And for us, that's a way for us to make a greater impact to end users who I'm very passionate about reaching. So Strangelove has a goal of providing whole product offerings, meaning something that touches the backend and has a front end component of it that allows users to interact with it and play with it. So we have been working for more than a year now, but over the course of this last year was very impactful for us to get the staff in place to be able to launch whole product suites and release them. And that's really what we're in the business of now. That's what strange love wants to evolve into. And that's just what me and Jack are passionate about. We think that's where we're gonna make the biggest impact.

citizen_cosmos:
I didn't know this because last time I spoke to Jack and Jack has been one of the most common guests on the podcast. I think he was on at least twice for sure. I mean, I think Dan overdid him with three times from Sui now, but I don't think I mentioned this. This is interesting because I've noticed the last time I was, where was I? Because I usually don't do conferences, crypto conferences in person. I really don't understand the value of that like above me. Everything is online, sorry.

tyler_schmidt:
Yeah.

citizen_cosmos:
Man, even interviews. And the last time I did go to Lisbon because I live in Madeira, so I traveled to Lisbon only because of Atom, of course, but of course I went to see the others and I know a lot of people. And I noticed I was talking to like Constantine from P2P, or Lido, I was talking to JK from XTechFish. Now talking to you, and this is interesting, a lot of people are building wallets and a lot of people are understanding that this is an application time like you said to the users are going to be over there. Is that the reason you are trying to go to the point of the mass concentration of users? Or what is the reason that so many people now build wallets?

tyler_schmidt:
I think that a lot of people looked out at the space and said there's room for improvement. Um, and what we're seeing now is this massive creativity event that I'm very excited about. And I think the wallet space is both exploding, but also not like there's a lot of wallets in the space, but Kepler still seems to be the leader inside of the cosmos ecosystem, you know? Um, and. You know, I think Kepler is good. I use Kepler, but interacting with it on a day to day basis for, for asset management, the way that I have. I've seen areas where I'd want to have it improved too. So I said, great, this is exactly the type of impact that strange love can make. This is a true contribution to the cosmos ecosystem. And we really said, this is the problem that we see. That's the most pressing. So I think that many people have identified that. The wallet and asset management issue is one of the most pressing issues in the Cosmos eco right now. And a lot of people are just attacking it simultaneously. And we're going to see what happens. And this could be entirely Greenfield space where all of these wallets end up having a large enough user base that they can support themselves. I don't know how these other teams are operating, but strange love has. the validator business and the software consulting business and these ARR products that sort of support our balance sheet so that we can create something that's consumer facing that we hope to also make money off of as well. But really we just care about providing this value to users because if we do that, we gain more user adoption. We gain more net new users into the Cosmos ecosystem and we win the greater battles which are winning adoption over from. EVM chains and things like that where the where the big competition is So everything is happening internally in the cosmos. I think it's great I think there's a lot of healthy room for people to operate and build Their own specific wallets that may have their own specific use cases and that's going to be great I'll say that what we're building is going to go after a general user who has little to know pre-existing Cosmos knowledge and we're starting there with someone that may not be a Cosmos expert. And hey, that could leave room for a power user while it come out. So we'll see.

citizen_cosmos:
Here is a last spicy question before the Blitz from what you said. Is Cosmos in competition with EVM chains?

tyler_schmidt:
I think it is. You know, or if you're looking at what infrastructure are we building and versus the infrastructure they're building, it has to be. It's just that there's rollups on one chain and then there's sovereign app chains on the other chain that also happen to have rollups and data availability and all these other great things. I used to hardware mine Ethereum and I invested in Ethereum when it was worth $10 and I lost that wallet. So yeah, so lesson learned. But I've been bearish in Ethereum more times than I can count and all those times were a mistake because network effects are really the king when it comes to adoption. I mean JavaScript isn't exactly the best language out there, but it's the most widely adopted language by devs for web production. You know, some things just win via network effect. I think Ethereum with Solidity is very much an example of that. And now it has the momentum and network effects and traction to continue iterating and improving upon its experience where it had shortcomings. It may overcome those just through raw force of will. So we got to compete with those guys. And I think that's healthy. And we also have a technology advantage over them already. It's really more about these network effects, getting devs on, and then, you know, more, more things like D Y D X happening where D Y D X is moving over to the cosmos, you know, the more we see events like that, um, the more we're going to see greater adoption for the cosmos. Um, but I think that's going to happen naturally.

citizen_cosmos:
I definitely agree with the competition is part of the open market and part of nature and part of you can see that this way the trees grows, right? Even right. So competing for light, I mean, and if you're looking at the way that nature does things and it's just in my opinion, like my and our goal here as citizen cosmos, we always say that is to is to bridge the communities to bridge the L zeroes. We believe that regardless of whether these protocols compete with each other, we want the communities to understand that they still have to interact and that interaction whether in born in competition or outside of competition I believe that will create a bigger synergy at the end of the day but that is not to say that they don't have to compete

tyler_schmidt:
Yeah, I mean, I'd say interoperate is my keyword there. And like, let's just create more avenues for interoperation.

citizen_cosmos:
Tyler Blitz, three questions, they're gonna go down three to one. You don't have to be super quick. We don't have to, there's no call for that. Three projects outside of the obvious ones that you could name that technologically, that technologically arouse some interest in yourself, in your opinion lately. And please don't start saying the obvious like cosmos or ethereum projects that something interesting. There doesn't have to be three, but something interesting that you're like, this is cool, this is interesting. I have never seen this solution to this problem or this implementation.

tyler_schmidt:
Mm-hmm.

tyler_schmidt:
I'm really interested in Capacitor.js right now. Capacitor.js is a new JavaScript framework for cross-platform web production. You can basically build an app that's on Android or iOS and multi-factor, so you can do desktop and mobile with it. It's kind of a replacement for React and React Native. I'm really curious to delve into this technology more deeply. I think it's really interesting. That's one. Cosmove is another one, which is a Move VM instance for the Cosmos. Move VM seems to be the hot new thing that all the guys are talking about. So I'm really interested in learning more about that and getting a handle on that VM. I'm excited by that. And I just got to say. You know, I'd be remiss to not mention chat GPT-4. It's just so good. It's really good.

citizen_cosmos:
For the listeners out there, whatever you listen in this to this, it came out like 24 hours ago. So, so Tyler knows his shit. Okay, second one. When you kind of already answered that in many, many ways throughout the podcast, but I'm going to be more direct with it, two things in your daily life that, that motivates you to keep on building. Well not just Strange Love but contributing to this whole movement and do everything we do.

tyler_schmidt:
People that I work with at Strange Love are phenomenal. And it's a really special team. And I can't emphasize that enough. We have a high level of psychological safety and emotional trust amongst everyone on the team. And we're at a really special place at a 30 person organization that has this level of trust. So I would say the people at this point motivate me more than anything. I love working with everyone that I interact with on a day to day basis. And I feel very lucky, very lucky about that.

citizen_cosmos:
And the second one.

tyler_schmidt:
I'd say that the technology itself keeps me interested. There's always.

citizen_cosmos:
the baby, man. The baby, man, the baby. You have to say the baby. Im gonna help you out here hahaha

tyler_schmidt:
Yeah, yeah, Yes. No, the baby overrides that 1000%. Yeah.

citizen_cosmos:
Last one. Last one. One person doesn't matter dead or alive. It doesn't matter real or made up, doesn't matter developer, writer, cartoon character that inspires you.

tyler_schmidt:
Alan Turing.

citizen_cosmos:
Ooh, okay, that was interesting. Good.

tyler_schmidt:
I would really love to meet him and figure out how he cracked the Nazi submarine communication protocols. Yeah.

citizen_cosmos:
enigma, right? Would be interesting. It would be cool to...

tyler_schmidt:
Yeah, Enigma. would really love to hear more about that. But he, him and Claude Shannon are two true inspirations.

citizen_cosmos:
That is very good answers.

tyler_schmidt:
yeah. Yeah, man.

citizen_cosmos:
Tyler, man, it has been a pleasure. I loved hearing your side of Strangelove story. I don't think it's very common that we have several co-founders on the podcast throughout, the podcast even though throughout the years from the same project. So it's cool to put the pieces of puzzle together. And I hope that everybody else who listens to this enjoys that as much as I did. So thank you very much for all your time and for your awnsers Tyler.

tyler_schmidt:
Yeah, Serge. Thank you, man. It's been an honor. Come on really happy to share my thoughts. I really appreciate it

citizen_cosmos:
Thanks.

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