0 (2s):
Boom, shake the room, Fire Nation, JLD here in welcome to entrepreneurs on fire brought to you by HubSpot today, we'll be focusing on how DeFi is disrupting the financial space to drop these value bonds. I brought at Dr. Julian Hosp on the mic. He is one of the largest crypto influencers in the German speaking world. And as a medical doctor, an ex professional athlete, he's the CEO and founder of Cake and chairman of DeFiChain foundation. His vision is to bring blockchain awareness to a billion, more people by 2025. And today foundation, we'll talk about what is decentralized finance, how is it different from the traditional understanding of centralization? What the advantages are?

0 (42s):
What is blockchain and so much more? When we get back from thinking our sponsors online training is skyrocketing across every industry and thousands of entrepreneurs just like us are using Thinkific to create market and sell online courses, launch your own online course and share your knowledge with the world today. Get started at Thinkific.com/EOF that's THINKIFIC.com/EOF. Hiring can feel like trying to find a needle in a haystack, but when you post a job on ZipRecruiter, their matching technology finds these qualified candidates for you and invites them to apply. So while other companies give you too many options, ZipRecruiter finds you the needle in the haystack. And right now you can try ZipRecruiter for free at ziprecruiter.com/fire.

0 (1m 26s):
Dr. Julian say, what's up to Fire Nation and share something that you believe about becoming successful. That most people disagree with.

1 (1m 36s):
Pleasure to be on. I believe timing is everything, and I think many people don't give proper timing enough credit

0 (1m 45s):
Timing is everything proper timing enough credit. And I can tell you a little bit on our conversation today. If I had just had a little better timing when it came to Bitcoin slash other cryptocurrency, my life might be looking a little different as well. So I'm all about the timing. And as I mentioned today, Fire Nation during the intro, we're talking about how DeFi is disrupting the financial space. So let's just dive right in Julian. What the heck is decentralized finance, break that down for us.

1 (2m 17s):
It's actually something that's quite straightforward. If it's explained simply it's seven functions or seven things that finance or banks normally do, which is create value, transfer value, exchange value, tokenized value, lend value, identifying value in predicting value of the future. So seven very fundamental things normally banks do and decentralize that, which means there's not a central party anymore. That is in charge, but it's actually the entire community that's in charge of those functions sets.

0 (2m 48s):
So Fire Nation. That's why I brought Julian in here because this is kind of an interesting topic. It's a timely topic for multiple reasons, which we're going to be getting more detailed into, but this is the world that we're into. We're not saying that there's not going to be a centralized finance going forward for the next hundred years, but there's definitely going to be a strong, decentralized growth in the financial space. Let's talk about how it is different, actually, Julian, from the traditional understanding of centralization.

1 (3m 16s):
I think the concept that most people are familiar with is actually that of creating decentralized value and transferring that value. And that's because Bitcoin has been starting over 10 years ago and doing this in 2009. So it does actually those first two function sets and Bitcoin is extremely disruptive as probably most people seeing the news, large companies like Tesla, putting it on their balance sheets because they believe in this future. Now I agree with you. I don't think DeFi or decentralized finance is going to be everything, but I think it's going to be an important part. And yeah, with that, you're going to just have a lot of extensions. You're going to see some of these so-called decentralized exchanges where things digital things can be exchanged without a central custodian.

1 (3m 59s):
And that's very, very disruptive, decentralized lending is going to be very disruptive for access to this financial space. And so, especially for those that have followed everything with game stop and the Robin hood stories right now, the so-called decentralized tokenization where stocks and bonds and commodities suddenly get de-centralized at that very highly regulated port gets decentralized. We're moving towards well total financial freedom. And that's sometimes quite scary. I think also for the record

0 (4m 28s):
Now for those people that may not be that familiar with the game stop and the situation that's going on there, maybe just a little confused about it. Can you dive a little bit into that and how that actually plays a role in the conversation we're having right now?

1 (4m 40s):
The main story there was that a lot of the smaller investors, retail investors, what it's called kind of gathered up, especially on Reddit, which is like an online forum. And they were kind of fed up with large funds and large institutions trying to push down certain companies, which is called short-selling. So you're betting on these companies going down and these people just gang up and said, you know what, if it's a lot of us and we put all this money together, we can actually really push back. And that's actually what happened, especially on companies like Nokia and GameStop and blackberries are companies were objectively saying, they're not worth much, but this retail bunch of group really pushed against.

1 (5m 20s):
And so you would sit there and say, okay, I'll find. And it was a back and forth. And on one hand it looked like the big boys, the, the institutions were winning and then it looked like the Reddit investors were winning, but then that's where it got extremely disruptive. It really looked like retail, Reddit. The average Joe, the small investor were winning and suddenly Robin Hood and many other platforms pulled the plug and didn't let those small investors keep investing, but actually forced them out of the investments. And so that meant the other side was inevitably winning. And so there was this major kind of outcry where, well, as long as the big boys are winning, you kind of play on their side.

1 (6m 2s):
And as soon as we would start winning, you pull the plug and that was because Robin hood or those banks or those platforms are centralized. There is this central party that has the power. And so that wasn't a humongous move towards DeFi, especially since this happened over the past couple of weeks, there was a lot, a lot of people tweeting and commenting on that. And there's not even a hearing in the Senate on it because it was, it was very questionable if what they did was market manipulation or not, then DeFi would completely remove the power from those platforms and would the power actually put the power to the community? And that's something obviously that I'm also very passionate.

0 (6m 38s):
Yeah. There's a lot of crazy like conspiracy theories that are being thrown around. And you know, this is a very interesting and crazy time right now that we're dealing with. I mean, the Robin hood is literally getting death threats and living in a hotel right now because people are so pissed off because of what happens. You know, of course they're claiming that like, Hey, they're not in collusion at all with the wall street, hedge funds, they're just, we're forced to do it because they couldn't cover these quote unquote bets that were happening, you know, from this Reddit forum, this actually called wall street, Betts Fire Nation wall street best, I guess, has now over 8 million and growing. It's probably well over that now users of people that are in there, you know, taking all these crazy quote-unquote wall, street bats, you know, trying to go all in and Yolo.

0 (7m 21s):
You only live once and doing all these different things too. I just had a bet on the house, or I should just say bats, like it's a casino because that's kind of what their, their attitude is right now. And, and it's, there's some really fascinating information out there, but to kind of pull it back to what we're talking about, Julian, what are the specific advantages of decentralized finance? I mean, we've been talking about what that could be in the last situation, you know, with what happened with GameStop, but what are some of the other advantages in decentralized finance that could really make just this world a better fairer place?

1 (7m 53s):
I would love to talk about the advantages, but also the disadvantages. I think both are really important because not everything just has an upside, right? There's always a flip side. The advantages definitely are that there is no one that you have to trust. So you are in control. The community's in control, those know trusted counter party. And that's very disruptive by itself because that also means that if you make a mistake, it's up to you, there's, there's no customer support. So that's obviously a downside. You, you aren't charged, but that means you aren't charged. And it can be very scary. The other thing, because no one is in charge, everything is completely transparent, which is extremely powerful because especially in financial space, you, you hear about this in transparency and you hear about a lot of these kind of things happening behind the scenes that the average person doesn't have access to.

1 (8m 43s):
And suddenly the playing field is leveled because of this full transparency. And, and obviously that's powerful. And then the last aspect is this open access, a blockchain or decentralized system. It doesn't discriminate. It doesn't discriminate against age. It doesn't discriminate against gender against race. Everyone is 100% equal. And so obviously that's what a lot of people appreciate. And that's what I mean, especially the past months, past years, there has been a push towards that. And you can see it as in the, in the upcoming off DeFi and the importance of DeFi beyond what Bitcoin is providing to those additional services.

0 (9m 20s):
So Fire Nation, I hope that you're really understanding what some of the advantages are. I hope you're seeing what some of the disadvantages are. Is there anything you want to add Julianne to either the advantages or the disadvantages, or do you feel like you've covered them fully

1 (9m 33s):
Advantages are clear. It's open, it's democratized, everything is equal. Everyone has access to it. But the problem of this is it's very, very inefficient. It's extremely slow because everyone needs to be on the same level. Sometimes it can be extremely expensive to do that. Inefficiency always comes with all these diversifications many times. And especially as an entrepreneur, as you'd know, that focuses everything, lights bundled into one small beam can light something on fire, anything else? Yeah. And, and not doing that well, just light and, and, and the same thing is here. So there are ups and downsides. And that is why, especially when you mentioned that DeFi is not going to be the only thing going forward, you're 100% correct.

1 (10m 19s):
But I love to see DeFi as this gatekeeper artists, this th th th the check that, that makes sure that the centralized finance system doesn't go haywire. It doesn't go totally overboard. So there's this counter balance. And I think that's what defines so excellent about it.

0 (10m 34s):
So Fire Nation, we've talked a lot about decentralization, the finance, the advantages, the disadvantages, you know, how different, you know, it is from traditional understanding of centralization in the world that we lived in for so long. We have a lot more, we're going to be discussing such as blockchain. We're going to be talking about, you know, the fundamental understanding that we're all going to be having over the next five to 10 years when it comes to blockchain and centralized and decentralized finance. You know, if we want to have our finger on the pulse and so much more, when we get back from thanking our sponsors, if you're a business owner who's hiring, you probably face a lot of challenges when it comes to finding the right person for your role, like not having enough applicants with the right skills or experience.

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1 (13m 23s):
So imagine we would, everything is digital, quite easy to understand right now with all the COVID situation going on, everyone being remote. So there's nothing physical, everything is digital. And let's say we would try to keep check on money that we owe each other. And we are not using traditional dollars, which is using our own money here. You'll fire coins, for example. And, but we don't want anyone to be in charge because then that person could just create those coins out of, out of nothing. So no one should be in charge, but everyone should be in charge. So how would we go about that? And the way we would do it is we would put, let's say a regular excellent sheet, and we put it into blocks. And we say, you know what? Every 10 minutes we hop on a Skype call really quick.

1 (14m 6s):
And we talk to each other, how much did you send to everyone else? And so we hop on this call every 10 minutes, obviously, very inefficient as a human being. But as a computer, it would be super fast. And we discussed this and John says, Hey, you know what? I send a couple of your fire coins to you, Julian and ice, and a couple of Kate and Kate maybe gave you some. And so we just record that in that block. And afterwards we synchronize that block among each other until at least the majority. And that's always a key thing that the majority, at least 51% say, you know what? Yes, that's exactly what happened in the last time block. And now it's, and this is a cryptographic thing. There's going to be a final little key and that key connects or chains that one time block to the next one.

1 (14m 51s):
And we need to include that key in the next block. And the reason this is important is because now when we fill out the next block, it's automatically chained to the block before if we were to change anything in this block, the other blocks would become invalid and everyone could verify that. And so if we keep doing this, what's going to happen is we're going to have blocks of information change together. That is unchangeable, unless, and that's the key part, unless you change at least the majority. So 51% of all the participants. And so the power here is of course, if it's just the three of us, it's not that exciting. But if you have hundreds of thousands of people, it suddenly becomes this point where trying to manipulate the blockchain, the database in a malicious way is actually way more expensive than an economic gain that you would get out of it because there are so many people involved that you would have to change or manipulate, and it just wouldn't work out anymore.

1 (15m 48s):
And so the power of a blockchain generally is that you could store any information. For example, I got into blockchain seven years ago because I'm a medical doctor and I wanted to store medical data in there. And I just realized it was extremely difficult to do that. And that's how I ended up in the financial space and cryptocurrencies where it's very easy. So if someone asks, what is a blockchain, it's nothing else than a database where information is stored in blocks that get chained together, where the majority of the community agrees on and terabytes unchanged,

0 (2s):
Fire Nation, Annette changeable, and just listen to what Julian is talking about when it comes to blockchain in general, and how I really want to take this conversation.

0 (16m 23s):
Julian is why, like, why is blockchain specifically going to be a fundamental part of our day to day in the next five to 10 years? I mean, this is not a long timeframe from now, like this is the near-term future. Like this is literally in 2025, 20, 27, 2030 is going to be part of our day to day. Why is that the case

1 (16m 44s):
Just like decentralized finance is an application of blockchain. So uses blockchain uses the same advantages and disadvantages. And so these adventures apply to anything. Anything that uses a blockchain is slow. It's inefficient, it's expensive, but there was no central party that can overrule someone else. Everyone can join that community. There is no discrimination. It's completely transparent. You see exactly what's happening so you can trust what's happening. And we live in a world undeniably where we always look for more equality. We look for easier access. We, we, we want to have equality.

1 (17m 25s):
And we look obviously for this transparency because we believe, Hmm, not sure how, how fair and how transparent everything is going on in order to build that trust. And that's why, again, blockchain is not going to solve that everything over the next 10 years, but it's, it can solve a few problems. And I think solving those problems can make society a better place.

0 (17m 44s):
So how do you want to end our conversation today? Wrap it up with the key takeaway you want to make sure Fire Nation really gets from everything that we've been talking about. Then share a way that we can connect with you specifically to learn more about this conversation, this topic, and then we'll say goodbye,

1 (17m 60s):
Blockchain, DeFi de-centralization is not solving everything, but it's going to provide options. And it's going to provide options in an area many times where people without the system do not have any options. They are forced into one option. And that means no option. And that's why it's so powerful to learn about that. And that's why I'm so passionate about all that. Yeah. If I'm mostly active on Twitter, if you want to follow me on there, my handle is @JulianHosp. I talk a lot about DeFi about my companies, my investments in Bitcoin and, and how I see the entire cryptocurrency world. So obviously it would love to get in touch.

0 (18m 39s):
So let's get real specific. What is the best way for Fire Nation to get in touch with you to learn more from you about this topic?

1 (18m 46s):
Tommy me on Twitter, the handle is at Julian Hosp,

0 (18m 49s):
JULIAN HOSP Julian Hosp on Twitter and Fire Nation. You know, this, you're the average of the five people you spend the most time with. And you've been hanging out with JH and JLD today. So keep up that heat and head over to eofire.com and type Julian in the search bar. And his show notes page will pop up with everything that we've been talking about today. Best show notes in the biz in Julian. Thank you for sharing your truth, your knowledge, your value with Fire Nation today, for that we salute you and we'll catch you on the flip side. Hey, Fire Nation today's value bomb content was brought to you by Julian ENS. I've created a treasure trove of free courses for you and teach you how to podcast run a mastermind, create funnels that convert and more.

0 (19m 34s):
All you need to do is visit EOFire.com/resources to start learning today. I'll catch you there, or I'll catch you on the flip side. Online training is skyrocketing across every industry and thousands of entrepreneurs just like us are using Thinkific to create market and sell online courses, launch your own online course and share your knowledge with the world today. Get started at Thinkific.com/EOF that's THINKIFIC.com/EOF. Hiring can feel like trying to find a needle in a haystack, but when you post a job on ZipRecruiter, their matching technology finds these qualified candidates for you and invites them to apply. So while other companies give you too many options, ZipRecruiter finds you the needle in the haystack.

0 (20m 17s):
And right now you can try ZipRecruiter for free at ZipRecruiter.com/fire.