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Paolo Ardoino, CTO of Tether, on $USDT Fud and Tether’s Diversification into Energy | Ep. 255

In an exclusive interview with cryptonews.com, Paolo Ardoino, CTO of Bitfinex and Tether, talks about Tether ($USDT) FUD, Tether’s Diversification into Energy, and Tether fostering the use of P2P technology.

About Paolo Ardoino

Paolo Ardoino is the CTO of Bitfinex and Tether, who also recently launched Keet.io, a Peer-to-Peer Chat App, built with the Holepunch platform that allows anyone to create apps that don’t use any servers. Paolo is also a certified meme-lord and has one of the best accounts on crypto Twitter.

Paolo Ardoino gave a wide-ranging exclusive interview which you can see below, and we are happy for you to use it for publication, provided there is a credit to www.cryptonews.com. 

Highlights Of The Interview

  • Tether ($USDT) FUD – Why USDT depegs for a short period of time – USDT to fiat redemptions
  • Tether’s Diversification into Energy
  • Partnership with Government of Georgia
  • Tether fostering the use of P2P technology
  • What’s next for Tether?

 

 

 

Full Transcript Of The Interview

Matt Zahab 
Ladies and gentlemen, welcome back to the Cryptonews Podcast. We are buzzing as always, and I’m super pumped to have the one and only Paolo Ardoino back on the show. He’s coming in hot for round three. The CTO of Tether, CSO of Bitfinex and Co-Founder of Keet.io. This man needs no introduction, so we will jump right into it. Paolo, welcome back for round three, my friend. How you doing? 

Paolo Ardoino 
It’s always a pleasure to be on your show Matt and I’m doing great. Thank you very much. 

Matt Zahab 
Appreciate the kind words, my man. Let’s jump right into it. The talk of the town, the elephant in the room. We are recording early to mid August, and this episode will also air early to mid August. And what do you know, Tether is getting shit on all over Twitter once again for a whole lot of nothing. I am friends with Paolo. I am a diehard Tether fan. I’m rocking the Tether hat that Paolo gave me two years ago. Just a quick little note for the folks and the listeners at home. Guys, do you understand that if Tether went down, we would all be effed. We would be hooped. There would be no more show. The show would not go on. The end of the party would be there. It would not be fun. I don’t get why we’re all rooting against you guys. It makes no sense. But Paolo, I’m going to throw it over to you. What the heck’s going on right now? Why is everyone shitting on you guys? And I’d love if you could just segue into some of the resilience of Tether and how you guys are still the second most important crypto behind the one and only Bitcoin. 

Paolo Ardoino 
Well, Tether has kind of a magic aura, if you will. It’s created an obsession around it. I think part of the success of Tether over the years have been everyone was always so curious. Everyone was desperate to look inside Tether. Right? So people were imagining the craziest things. And then in 2021, we started providing attestations. We started providing numbers even more recently we decided to not fight back against this foil act. That is a Freedom of Information Act that allows journalists in the US to access information that we shared with regulators. And guess what? Once again it became public that we didn’t lie, that we provided actually all our information was factually true and that Tether was well capitalized is well capitalized. Today actually is the best moment in the history of Tether. And when it comes to solidity, stability, strength and so on and so forth so for all this reason, people don’t want to be wrong. There is a ton of people on Twitter that like to be right, like to say something that eventually comes true and they would like to see for some reason Tether failing. Just because they say so to their grandmother, to their sister, to their friend and so on, just because they hate that someone could point the finger to them, telling them look, you are full of ads. And actually once again for the last six, seven years you were wrong about Tether. So why you keep talking about why you are keeping spreading FUD and lies around Tether? And so you know, people, every time there is a small signal, there is some coordinated attack, you see all these Tether truthers piling up. We discover all that there years that some were paid. Of course some are actually genuinely obsessed. Either you believe that the government is hiding aliens, that is more probable than Tether having actual issues. They are dividing between okay, there is the Area 51, there are some spaceships that someone is hiding from us and there are the green aliens, the gray aliens and so on. Or the other big obsession is actually Tether. And in a way I find this one of the most exciting things about Tether. It wouldn’t be that fun, that interesting if people were not that obsessed by so I take whatever we get. Because in the end, this type of obsession this type of obsession, also from the media, has represented the success of Tether. Right? All the Financial Times, Bloomberg, everyone has always imagined the worst when the entire banking industry is crumbling, you know in front of their eyes. They have spent three years looking at Tether, doing the spending the craziest amount of time in trying to prove something that actually Tether was not. And in the end the thing that was most dear to them that is the traditional banking system is crumbling. And so that is quite interesting because sometimes it feels like we are pictured as the villain in the industry and maybe the villain is just a matter of perception. Maybe we are actually for the traditional financial system, we are the villains, but actually for the people living in emerging markets in developing countries saying the hero is maybe he’s too cocky, but he’s like a normal guy that want to be helpful. And so once again, in these days, basically what happened is that, it’s not me you should look at around Twitter. Everyone is saying that there are some big parties that are trying to put pressure on tether.to create redemptions and it’s fine. Right? So I’ve been vocal about it because I think people should understand why the price of USDT on secondary markets that is really important on the secondary market is trading slightly below $1. I’m saying slightly because it’s just few basis points below the dollar. Our major competitor three months ago traded 13% below the dollar and here we are talking about few basis points. Nevertheless, I mean, I publicly demonstrated and said what was the cause because I don’t want people to be scared for nothing. Right? So there are some parties are pressuring USDT on the secondary markets. Tether as a company has only and can only deal with the primary markets. That is the main platform tether.to. So when a customer comes from tether.to, they can redeem any amount of USDT and get Fiat back. In fact, yesterday we were able to redeem in one single day, in one go, $325,000,000. So there are a ton of people that can redeem ton of companies. Of course, when we said that some users complained that they could not redeem. And the reality is that yet again, there is a good explanation that some users could say that if you want to redeem USDT, it means that you want to use the banking channels. And if you want to use the banking channels, if you want to receive but why you have to follow the banking standards. Right? 

Matt Zahab 
KYC takes time. It’s not easy. 

Paolo Ardoino 
Exactly. But also if we ask you as a hunter party as proof of funds. That is one of the classic things that the bank would ask, because, again, we need to use our banks to send wires back to you. And if you go like, okay, what is that, a proof of fund, then maybe it’s your problem that you cannot explain how you got the funds. Right? People really need to investigate a bit more before believing everything that is happening is going on Twitter. There are a lot of forces at play. There are many incentives. One of the reasons why this is happening is Tether is making a ton of money, right? Doing a simple work. 

Matt Zahab 
Could we jump into this Paolo? You guys, your tweet storm from I believe it was the end of July. I have it right here. On July 31st, you highlighted Tether’s Q2 for 2023, you guys had operational profits north of a billion dollars in excess reserves at $3.3 billion. I don’t know why there’s this narrative out there, but a lot of people seem to think that you guys are just holding alla FTX a bunch of nonsensical coins, and that makes up your value. But you guys are one of the largest US. Dollar T-Bill holders in the whole friggin world. And I believe someone commented on your Twitter thread and said that you guys hold more bills than, like, Brazil, Spain, the UAE, some world class countries here. It’s absolutely bananas. I’d love if you could talk more about how successful of a quarter you and the team had at Tether. 

Paolo Ardoino 
Yeah. Thank you. So, the last of several successful quarters, it all started with a simple idea, Right? Tether and over time, I think we have been quite transparent and open about our serves recently, especially at the beginning end of 2021, beginning 2022. We announced that we would put all the commercial papers and the majority of the assets in USD bills and we would go until we had only USD bills. And we are well in the process in achieving that now. So at this point, we hold around $72.5 billion of USD bills. That puts us in the top 20. If we were a country, of course, would put us in the top 20 countries. Look, we are living in a moment where due to inflation and many other reasons, the interest rates on these T-Bills are super high, up to 5.5%. So the way, the reason Tether makes money is because you have seventy two billion dollars, seventy two point five billion dollars that are generating 5.5% per year. And so the US T-Bills are considered the least risky asset. We hold the short maturity one, so less than 30 days. We also have a great program to use the overnight reverse repos to have liquidity at hand in the order of the tens of billions of dollars. So if we get the redemption of $5, $10 billion dollars in day prone, let’s go and all our assets are completely liquid, right? We can process redemptions of any size in a matter of a blink of an eye. And I and so I think it’s one of the most exciting things about Tether. Right? So if we are demonstrating to the banking industry how you can be profitable, extremely profitable, without taking in under risks, remember that what happened with Silicon Valley Bank, what happened with Signature Silvergate. All those banks were shut down because they were holding 10 to 30 years Municipality Bonds. Right? So we hold three months US. Treasury bills. And we are the ones bashed by Acti or Bloomberg and so on. Those guys were holding like, I don’t know, it’s like if Tether was holding like ten years Municipality Bond of, I don’t know, Portofino, a small town, beautiful town but small town in Italy or like, I don’t know, Santa Marguerite, like all these small towns, I mean, come on. So these banks were used by everyone in the crypto industry, almost everyone in the crypto industry and they were almost dragging with them our main competitor. And so I think people really are, in a way, a little bit jealous of Tether success and also are trying to use their power to at least try to get a piece of it. Because if they can get a little bit of market cap from Tether, they could get a portion of those yields and it’s fine. Right? It’s not a problem. But as long as it’s clear what is happening and it’s clear that it’s organic, it’s clear that Tether doesn’t have any problems, that’s fine, right? That’s the beauty of competition. People attack you, you have to be ready. The only job of stablecoin is to be solid and so on. 

Matt Zahab 
It’s very healthy. There definitely are a lot of incentives to go after you guys again if you are short crypto as a whole in any capacity, your easiest way to win is to try to take down Tether. Obviously we all know that’s the elephant in the room. And then just like you said, the jealousy aspect. I’m looking at the balance sheet right now. You guys are a money printer which is everyone’s dream. I wish I had a money printer, but I don’t. So ces’t la vie. I want to talk about one other thing in regards to the FUD and then we’ll get into some more fun stuff. You guys against, not against, but Binance, Justin Sun and TRON. These guys are always up to some spooky stuff. Them two are realistically, the mayors of spooky town. They have a lot of power and control over the crypto market as a whole. And just like we just talked about, they have incentives to try to depeg Tether and to try to bump up BUSD, which know Binance’s version of Tether. What’s going on in this whole situation? Do your teams ever communicate? I’d love if you could give us a behind the scenes look on what happens here, because again, they’re continuously going at you. Sometimes they’ll maybe depeg you guys by a couple cents. Not cents, excuse me, tenths of cents at most. But what’s going on with the whole Tether slash Binance or Justin Sun, TRON relationship? What can we learn about in regards to what goes on behind the scenes there? 

Paolo Ardoino 
Well, look, it’s quite interesting because in crypto, even if you are deep in crypto, it’s really hard to know what’s going on behind the scenes. As I said, everyone has his own agenda, has its own incentives. Maybe we are seeing other jurisdictions like Hong Kong becoming pro crypto. So there are indefinite incentives to move some capital there. It’s really hard to predict what will happen and which attacks Tether will get and from whom. Right? So we try to have a healthy and open discussion and conversation with everyone because in the end, Tether is central to all these platforms, right? To Binance, to all the projects that Justin Sun is developing. And I think Tether is being used by and today I just tweeted before kind in on the show that Tether has 80% of all the crypto and foreign currency market in Brazil. Right? So I think again, I’m going again on the sorry if I repeat myself on the jealousy part, on the I want a piece of that part. And I think it’s normal. Look, everyone is trying to become more resilient and making money in a moment where the entire crypto market is down is crucial. Right? So the volumes, look at the volumes on exchanges. They are down 70%, 80% from last year. And so it means there are exchanges that have been, you know, making money only with revenues, with trading fees. They are probably scrambling to pay the bills. And so especially if they have some of our competitors, if they have 2, 3, 4, or 5000 employees, that is enormous cost per month. You scratch your head every day and say, well, what I can do? What is the most profitable thing I could do in this market? Because who knows how long this market will continue because maybe Bitcoin next year will have the halving. But even if Bitcoin thrives, doesn’t mean that all the altcoins will thrive. Right? So then again, if you’re an exchange, that is going to be really problematic if you have thousands and thousands of employees. So in the end, we are expecting the competition and we remain friendly with everyone. Nevertheless, we think is in the end, we proved so many times that we are central and to this industry that we are more solid than everyone else. We have sustained tax that all our competitors cannot ever imagine, even. And so every time we see something like this, we as a team learn something. We improve our CNC. We grow as a team, as people. I myself, I’m a simple person, Right? I’m a developer. I’m excited about technology. I’m a nerd. And I like finance a lot. And I would never have guessed. To find myself in this situation. Every single day that I wake up, I’m so energized because even if they are punching my nose, I’m going there and happy because I’m learning things that someone else would take for someone else would take maybe ten lives. Because we are seeing trace of things. And not just myself, but for many people in the industry, it doesn’t matter if they’re attacking us, Right? So we are getting stronger by the day. 

Matt Zahab 
Just such a wild journey, like having $72 billion of exposure in US T-Bills. Did you ever think you’d be the CTO at a company that has $72 billion in US T-Bills? That’s just bananas. That’s beyond wild. 

Paolo Ardoino 
Yeah, I mean, of course not. I would never have imagined it’s exciting because now we are at a stage where in the past years, also they’re part of our relationship with the US. But also it’s quite interesting because right now we are living in a world where you have the BRICS trying to launch their own currency, big powerful countries selling their T-Bills. I think Tether in every single TBL option is one of the top layers in this moment. And so we are the guys that are buying the T-Bills and renewing our purchase of T-Bills while countries are actually sending them. And so I’m really humbled by the entire situation because it’s beyond, I think, my imagination and everyone’s imagination. 

Matt Zahab 
Folks, we’re going to take a quick break. We’re going to keep buzzing on Tether when we get back and talk about tether’s diversification into energy and some recent investments into energy as well, including a partnership with the government of Georgia. But until then, huge shout out to PrimeXBT long of cryptonews.com and sponsors of the Cryptonews Podcast. PrimeXBT offers a robust trading system for both beginners and professional traders. It doesn’t matter if you’re a rookie or a vet, you can easily design, customize your layouts and widgets to best fit your trading style. PrimeXBT is also running an exclusive promotion for listeners of the Cryptonews Podcast. You can use the promo code CRYPTONEWS50 to receive 50% of your first deposit credited to your trading account. Again, that is CRYPTONEWS50, CRYPTONEWS50, all in word to take advantage of this offer and receive 50% of your deposit credited to your trading account. Now back to show with Paolo. Mate a couple of big things that are not, per se, traditional Tether esque, really just non USDT kind of things. We have tether’s diversification into energy. You guys are geared at fostering sustainable and responsible mining practices. Renewable energy sources, solar, wind, hydroelectric, you name it. And of course, last time we were on the show, you guys discussed your big raise to not raise, but how you guys are aiming to donate billions of dollars to help the Bitcoin mining facility in El Salvador as well. These are two massive things I’d love if you could talk about Tether’s diversification into energy and what you and the team have planned over the next couple of months and years moving forward. 

Paolo Ardoino 
Yeah, so what the question is, if you have this profitable business, what is the right thing to do? Right? So we are in this situation thanks to Bitcoin. So the entire Tether success story is about trying to improve Bitcoin trading through providing the same or leveraging the same technology that Bitcoin created, aka the blockchain, and just move dollars on top of it. And we as a team, Bitcoiners at heart. So I think we clearly have seen in the last two years how energy and how Bitcoin mining are becoming central for future sovereign countries. And so of course, one of the attacks against Bitcoin mining from many sides is the potential consumption of nonrenewable energy or even potentially stealing energy from the poor people in the country. So what we thought was, first of all, let’s start with energy production. Because if we create our own energy production facilities that are full renewable, then we are contributing to the country itself. And then we can use the excess of that energy to mine Bitcoin. And so to help Bitcoin to become Bitcoin mining, to become more decentralized, I think it’s really important. Before, in 2017, 2018, we had China that was heavily concentrating the Bitcoin mining hash rate, and now it’s the US. But we want to have multiple countries being co-equally participating to Bitcoin mining. And so we think that is strategically is the best thing for Bitcoin to try to diversify its sources for mining. And that’s exactly what we are doing. Right? so this additional $3.3 billion that you were mentioning in excess reserves that are now in the Tether balance sheet, maybe a Silicon Valley company would have distributed those as dividends to their shareholders. And yet we decided to keep the vast majority inside the company. First of all, to strengthen the stablecoin, and second, to make strategic investments still small compared to the three pointer billion dollars in this moment. But eventually they could grow the more these additional excess reserves would grow, so that we could remain true to the Bitcoin philosophy and we could give back to the Bitcoin community and to the countries that are supporting us. 

Matt Zahab 
I love that I mean, it seems like the right thing to do at the end of the day, but again, I mean, you guys could know padded your pockets with a crazy amount. Paolo, you also have your hands in two other cookie jars. And that is of course, Bitfinex, where you are also CTO, and the one and only Keet.io, which we discussed last time on the show. Funny yesterday, I don’t know if you saw, Zoom came out with new terms and conditions where all users do not have a choice. I believe you don’t have a choice, but you have to accept the opt in which allows Zoom to use all of your data, your facial expressions, your voice, everything to help grow their LLM AI. And come on, are you kidding me? Zoom you guys have done enough shady shit. Now you’re pulling this off? It’s so par for the course. You totally expect that. Before we get into Bitfinex, let’s start with Keet.io. And just for the listeners who did not catch the last one, Paolo, can you please give our listeners a quick TLDR elevator pitch on what Keet.io is and what you and the team are building over there? 

Paolo Ardoino 
Sure. So I’m a developer since all my life, and I’ve always been excited about privacy and peer to peer communications and actually distributed applications. And one of the main issues that I’ve seen and one of the biggest lies that I’ve seen recently when it comes to tech is that all the communication systems that we are using in our day to day life you know Zoom, WhatsApp, WeChat, Twitter, everything. They are running and they are using centralized infrastructures that are huge, infrastructures that are holding hostage all our data at every time. So imagine that we are on Telegram. Let’s say that you and I are in the same city and we chat on Telegram every time you write something on Telegram. That message is and let’s say that we are in Italy, Right? So I send a message to you man. And so that message will go to Frankfurt, that is nearby data center that is usually nearby city. Well, not nearby, it’s like thousands of miles but is most nearby data center that is being used by or most nearby location that is being used by big tech companies to host their data centers for communication systems. And so it means that my message to you will travel to 30 thousand miles to Frankfurt and then get back 1 km just from my desk, just to arrive on your desk, on your phone. Right? So 6000 miles or kilometers just to send you a message. And now we are also imagine that we are not sending a message but we are doing a Zoom call like much more data than a single message. Right? So high quality Zoom calls now they take again every single packet, every single bit of information that we see and all the audio, all the visual, everything of that Zoom call will travel thousands of miles. That is bad for multiple reasons. First of all is polluting the global internet infrastructure. So if you could keep the data local, that might be much better. You could avoid that switches because all this traffic is not magic. There are hardware pieces that are actually letting this traffic pass and cables that are passing this traffic. We keep spending ton of money so that our data can make travel thousands of miles and is completely useless because in many years ago. And still today, there is a technology called BitTorrent that proved that for five sharing, you can use peer to peer technology and share terabytes of data, finding the shortest path possible, Right? So with a technique that allows two devices, two computers, two smartphones, one computer, one smartphone to connect with each other without the need of a central server. So the beauty of it is that if we are in the same city, same country, I send a message to you or we do a video call, and the data will travel only to the nearby cell tower and will just be relate to you finding the shortest path possible. And so imagine how much the truth is that the majority of the people of this earth are talking to people that are in the same area. So imagine how much saving so why no one is doing that or no one was doing that. Because of course, if there is no incentive from the big tech companies to do so, because otherwise they will not be able to monetize your data. They leave. The only reason why these big data centers are alive and are sustainable because I think Telegram is spending $800 million per year in maintaining their infrastructure. But it’s just one example. It’s wild, but it’s too wild. Think about it. So Telegram has 800 million users and each user can upload whatever they want, well, up to a limit of 100 megabytes and so on. But you can send hundreds or thousands and thousands of messages per year, and your persona will cost only $1 per year to Telegram. So they are kind of under the weight of their own success. So 800 million users, $800 million. But eventually that will become problematic. So, of course, you can always argue that space will come cheaper so they can cut their cost and the technology will improve. But the problem is that they will still rely on technology that will force every single of these messages running thousands of miles. And then you are in UAE, for example, and it’s not that easy to connect or talk through on Telegram because they ban IP addresses that are belonging to Telegram. So the big lie is that we need a central server to talk and write to each other. And the reality is that the man has gone on the moon, has landed on the moon in 1969, and yet we think that so many are after the technology doesn’t allow us or doesn’t allow our devices to talk to each other directly. So with Keet, but bottom line, Keet is a peer to peer video chat. So it’s a chat that doesn’t ask you your email, doesn’t ask your phone number, use the same concept of BitTorrent, but not just for file transfers, but also for real time chatting and video chatting. 

Matt Zahab 
Yeah, video calls. 

Paolo Ardoino 
Yeah, we proved that is possible. And we are investing a ton of resources in the next two months, there will be a new big release that will completely improve the user experience of Keet will make it comparable to all our most used apps in our day to day lives. 

Matt Zahab 
And Keets all you got to do, just download it. I’m a MacBook guy. Paolo, I recall in his first episode. You told me you’re not a MacBook guy. I believe you’re a PC guy. You you were telling me how know make my own computer kind of thing. And I was like, Paolo, this is way above my pay grade. I cannot do this kind of stuff. But folks, listeners at home, Keet.io literally download it. It’s awesome. And I’ll be honest with you, Paolo, the one issue I have with it, and again, I know you guys are still so new. People don’t trust things when it comes to video chat and downloading, when it’s still so new and it doesn’t have a brand name yet. So when I have a meeting with someone and I’ll suggest Keet over Zoom or Google meet, they’re like why don’t we just use one of the two and then you have to pitch them on it. But again, that will happen soon. But again, this is not a free ads. Paolo does not pay to have his companies on the show. The quality on Keet is literally phenomenal. It’s world class. So I will give that to you and the team. 100%. And last but not least, Bitfinex, the third head of the three headed behemoth that you are currently working on. I still don’t know how you managed to have the time to do cool stuff like ski on beautiful mountains in Europe and also run three massive companies. I candidly have no clue how you do it. It’s rather Elon Musk like. But give us the TLDR. What’s going on at Bitfinex right now? I know you guys are shipping new stuff all the time, 24/7 365. What’s going on right now at Bitfinex? 

Paolo Ardoino 
Funny that you mentioned the skiing in the Alps, because there is a backstage photo to that. Right? So I had to manage a situation. So I was at 30,000 meters in the snow and with the laptop on my feet and I was solving a small issue. The beauty of Switzerland is that is everywhere even at 30,000 meters. In the Alps you have 5G. 

Matt Zahab 
How does that work? 

Paolo Ardoino 
It’s 100 megabits per second in the Alps at 30,000 meters? 

Matt Zahab 
My goodness. Is there a tech reason behind that? Do they have satellites at every where? What’s the reason? 

Paolo Ardoino 
It’s a small country. They have a ton of money and so they have great infrastructure. The beautiful thing of Switzerland is that everything works. 

Matt Zahab 
Bloody expensive though. 

Paolo Ardoino 
Yes, it is expensive. 

Matt Zahab 
So what’s going on at Bitfinex? Besides you being 30,000 meters in the sky making shit happen, what else is going on? 

Paolo Ardoino 
So we have launched a great application. Great feature to Bitfinex platform is the peer to peer trading that tries to provide a safe and trusted platform for whom is well to do peer to peer changes with neighbors, friends, family or people that they don’t know. So to provide a great UI, great platform with all the features that you expect like dispute system and chatting and photos and everything. So we launched that platform as a premiere in South America in four countries because we want to battle test it. We should be ready to do a big push in October that is one of the most awaited features because I think is going to lead as a next step to work on a fully fledged platform that covers all the needs of trade finance. I think trade finance is going to be the next stage of crypto and stablecoins. And so with Bitfinex having these roots in technology as well. Right? so building great platforms that can really resist to the Wrath of God. 

Matt Zahab 
1 second, Paolo. Sorry, I got to interrupt you there, mate. You said trade finance. 

Paolo Ardoino 
Yes. 

Matt Zahab 
What exactly do you mean by that and why will that be the next armored leg of crypto. 

Paolo Ardoino 
So, trade finance is basically international shipping and purchases. Imagine that you are like in Turkey and you want to purchase a big order of cotton from China or from some place in India and so on. You are like a manufacturer, like you are producing t-shirts and you want to have a big order of cotton or you are assembling PCs and you want to order chips from Taiwan. You place an order and then you have to send a payment internationally and so on. That is trade finance. It’s basically that part of finance that is just about trading goods, like physical trading. Right? So trading good physical goods and in just Taiwan is $1 trillion in volume per year. Trade finance, international settlement of purchases. And so the issue there is that Renault of course runs mainly on the banking system but it’s completely inefficient and it takes ages and the fees are enormous. But with something like Tether and paired with a platform, Bitfinex platform that can offer an escrow service for know, imagine that you want to buy an order from a cotton order and you want of course to pay or to release the payment. You can pay in advance but you want to know that the payment will be released on when you receive your order and you check the good quality of the cotton that is matching what you got. Right? So that is classic. You do it on ebay if you buy like a pair of jeans and you do it only if you imagine if you are buying a ton of chips, you want to make sure that you didn’t get a bad pallet of stuff. Right? So this is the perfect use case for crypto in general, I think for stable coins and with Bitfinex, the beauty of peer to peer training, the platform was described before is that has an escrow inside and so we are working to expand that escrow to become one of the most important escrow system. With APIs, fully automated or like manual depending on the use cases. So it’s completely versatile platform to serve the needs of trade finance. 

Matt Zahab 
Interesting. That’s a big area to get into right there. I mean, I used to work in currency and just the settlements, using the swift international system, everything, it’s all a shit show. It makes no sense. It’s completely outdated. I mean, imagine if you’re getting some of these Fortune 500 companies to switch from US dollars or Chinese Yuan over to Tether to do their settlements and purchasing and escrow and everything. I mean, that’s a big game changer right now. I like that hot take. Any other hot takes Paolo, in regards well, that wasn’t really a hot take, but I know you always have a bunch. Any hot takes for me in regards to crypto tech, anything? You and I haven’t talked since the whole AI boom happened. We got some crazy stuff going on with ZK 99. I mean, there’s tons of talk about not enough time. What hot takes you got for me before we let you go? 

Paolo Ardoino 
I think the next phase of evolution of AI, if we want to touch base on that topic, is going to be the personalized AI. I think one of the most concerning things is, of course, privacy. People are providing to ChatGPT or similar, even more personal information than they provide to Facebook. Let’s put it this way. Right? So on Facebook, you will never put your medical results. 

Matt Zahab 
Yeah. Hey guys. Hey friends. Summarize this for me. That would never happen. 

Paolo Ardoino 
Exactly. Or explain that for me. Right? But with ChatGPT, people are doing that and there is a company behind it that, by the way, he has the CO that also wants to scan your eyeballs. Yeah. I would be a little bit careful with that. Anyway, so you see, the problem is that the incentives, as I was saying around Keet, the incentives are always towards trying to create centralized things so that as a big tech company, you can keep control and you can milk the data of your users. So the next stage of, I think, the evolution of our group of companies, Tether, Bitfinex, Holepunch, so on, will be creating a system that you will use the Holepunch technology to share generalized AI models, like in a peer to peer like Victorian Style Fashion. But then the fine tuning of these models can happen locally. I think has to be the future of you need to be able to run these models locally with low energy. And usually you can you can see Llama, for example, is a good example. It can run on a Mac easily or an iPhone and still process good results. The tricky part of AI is that training the generalized models is extremely expensive. But once you do that, then you can share the models and then people can use them to fine tune them and run them on their own Mac or computer or smartphone. So that is where I think is going to be important is trying to have or give to the users, as we are doing with Keet, the opportunity to create their own personal Jarvis or Assistant. But that learns potentially even everything from you but is fully encrypted on your hard drive and no one can ever take it from you. 

Matt Zahab 
That’s so powerful. One of the thing that’s really scaring me Paolo well, there’s many things that scare me about AI, but there was a tweet I want to say a couple of days ago, this gentleman fine tuned a LLM and also utilized video animation and video creation software and AI. He now has an AI girl like for AI Simps, and he made $60,000 in one month where this literally computer generated, beautiful female is interacting with dudes. And I think that’s a one way ticket. 

Paolo Ardoino 
With an OnlyFans account?

Matt Zahab 
Yeah, exactly. It’s like a variation of OnlyFans. I just think that’s so spooky. There’s so many good ways. Imagine having your own Jarvis, your own personal assistant, that’s all world can move the needle like crazy and then we’re doing spooky shit like this. It just baffles me. But on the same side of things, you just talked about privacy. That’s a big trend. Another big trend is being lonely. The numbers of loneliness are skyrocketing. The numbers of young males not having sex is also skyrocketing. So I can see why this is a semi not good one, mind you, but it is a bit of a solution to this problem. So many ways we can take this combo. But the future of AI is going to be crazy, man. One last thing, Paolo. You always have your finger on the pulse when it comes to anything tech related. Any new cool Paolo recommendations out there? Computers, cameras, anything tech related that the general pop should be wary of. 

Paolo Ardoino 
So I can give a couple of advices. When it comes to devices, I would try the PINE64. That is an open source company is building Linux based phones. The building quality is not amazing, but also they are fairly cheap. You can get one for 1 for 199 and you have an entire Linux computer at your fingertips that can make phone calls and take photos. So it’s pretty cool. I use that a lot. Otherwise, Pixel 7 with Graphene is also a good choice. On the laptop side if you didn’t try it yet. I suggest to use try Lenovo X1 Carbon or a Dell X13 with XPS 13 with Qubes OS. That is one of the operating systems that we funded recently. Between Bitfinex and Tether, we provided funding for $100,000. To provide funding for the development. Again, it’s the most secure operating system you can ever have, so go and check it out. 

Matt Zahab 
Good to know. Amazing and as always, Paolo’s biggest recommendation for all of your banking and crypto apps, make sure that you have your Face ID ready. I’m joking. Never do that. That’s another thing I saw a month ago on Twitter. Some guy got taken advantage of and he had all of his logins for Face ID. So the people who did bad things to him literally grabbed his phone, put it up to his face and sent everything away. Folks, always check your shit always. Paolo, another incredible episode. You always bring the noise. We love you, we appreciate you. Thank you for coming on. As always, I would ask you where the plugs are, but I will do all the plugs. As always you can find Paolo on Twitter @paoloardoino. And that is with the pair beside his name as well. And I will include the links to Tether, to Bitfinex, to Holepunch and to Keet as always. But paolo appreciate it. Thanks again. Can’t wait for round four my man. 

Paolo Ardoino 
Thank you very much Matt. Was a really nice episode. Thank you. 

Matt Zahab 
Always a pleasure with Paolo. Folks, this guy brings the noise every single time. One of the true leaders in the blockchain and crypto space. If you guys enjoyed this one, I hope you did. Please do subscribe. It would mean the world to my team and I. Speaking to the team love you guys so much. Thank you for everything. Justas, my amazing sound editor, appreciate you, as always, and back to the listeners. Love you guys. Keep on growing those bags and keep on staying healthy, wealthy and happy. Bye for now and we’ll talk soon.