Web3 operates on the Decentralized Autonomous Organization principle, which enables the investors of the platform to make rules without any interference from a central governing authority. Diving into Crypto is back with another episode, with AdLunam co-founder and CTO Lawrence Hutson, who speaks on the evolution of the Internet, all the way from the beginning of Web1 into the Web2 and Web3 transition, that we're going through today.

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WEB2 TO WEB3 MADE EASY - LAWRENCE HUTSON

Participants:

JP ( Host)

Lawrence Hudson ( Co-founder and CTO of AdLunam Inc)

Nadja Bester ( Co-founder of AdLunam Inc)

00:22

JP

Ladies and gentlemen, welcome welcome welcome to our latest episode of Diving Into Crypto. This is JP from AdLunam, Inc. Speaking to you about Web3. And our guest today is the CTO of AdLunam, Mr. Lawrence Hudson. He's a software visionary and has worked on technology from longer than most of us can remember, but has always been at the forefront of the cutting edge tech that has shaped the industry from Web1, Web2, and now Web3. So, Lawrence, welcome. Thank you for joining us today.

00:59

Lawrence

Hey, great to be here. And what a privilege to get to talk about on a subject like this. It's fantastic.

01:08

JP

And we'll be glad to have you on this program today, Lawrence. So without further ado, let's get started. Ladies and gentlemen, please remember that ideas shared on this particular program belong to that of the speaker, and any information that you have is meant for education purposes only. Right? Okay, Lawrence, before we begin to get into the meat of this, tell me a little about what drew you into the Web3 space. I know you've been at the forefront of it right from the start, but what drew you to technology as a whole? I think that may be a better question to ask.

01:47

Lawrence

Yeah, that's a really good question. Jervis as you mentioned, I worked on some of the early protocols for the Internet. Actually was a contractor and developer on the first global Internet based on TCP/IP, and did several major projects in that area. One was probably the most notable one that you would recognize as Travelocity, which ended up getting purchased by Expedia, all that in the Web2.0 world. But at some point, it became like the same old same old. After Travelocity and after Amazon, then came the social media space, people being able to operate in the social media space. And to me, it became very boring and disinteresting because the cutting edge stuff was gone. And then just basically serendipitously, I went to a conference in Slovenia, up in the middle of nowhere, at a ski resort in Marlborough, Slovenia, on the border of Austria and the middle of nowhere, basically, and walked in.

03:05

Lawrence

I didn't even know it was a blockchain conference. And went in and went to this conference, and it turns out it wasn't even advertised as a blockchain conference. People from all over the world were there, and I'm like, what is going on here? Had no idea. I basically was the guy telling my friends, as a technical guy, that Bitcoin was a Ponzi scheme. Why are they even into it without even bothering to look at it? So I find myself in this situation with all these people, and I'm like, Something's going on here. Having been in these kinds of conferences for 20 years. And, yeah, that was the beginning. That was the eye opener. I drilled down in the technology, realized that, wow, this is as great an invention as TCP/IP, which runs the Internet today, fundamentally an equivalent of the invention of electricity. That kind of fundamental, with all the possibilities in front of it.

04:09

Lawrence

So that's how I got into it. It's so exciting, that I've just never looked back at Jervis.

04:16

JP

Well, that's awesome. I'm curious to find out, was there a particular speaker or something that happened at that conference that really was an eye opener for you? Was there anything like that?

04:31

Lawrence

I don't think so. I think it was just seeing the caliber of people and the quality of people that had made journeys around the world to get to this remote location, to go to this conference. It wasn't even advertised as a blockchain conference. I'm like, hey, something's up here. I need to pay attention. So it wasn't any particular. That was in the early days when we did the ICOs. And that was a possibility. I mean, I got with my friends, the other developers, and were talking after this conference. They had more knowledge than I did, but just the possibility of two school age kids not having a wallet, and one kid wants to buy the other kid's sandwich, and he just pulls up his phone and buys the other kid's sandwich right there, instantly. And then the cross border aspect of it, because there's no borders, right?

05:28

Lawrence

So all of a sudden, the largest market in the world, which is foreign exchange, I don't know, it's like $600 million a second or something. Probably more like a billion dollars a second, all that. Wow. The possibilities just started going crazy. So, yeah, it wasn't any particular thing, but it was just the whole concept. And I feel very blessed and fortunate that I was able to be there and see what was going on. And what's interesting, I will make an interesting note, is that I had a lot of my friends telling me about this that were not technical people, and that's what's so different between Web3 and Web2, because Web2, you had to have technical expertise to get into it, develop it. But here I have friends that have no technical background that are buying Bitcoin and stuff like that. So that was a major difference between the two, between Web2 and Web3.

06:30

JP

Okay, since you've had this experience, could you elaborate for us, then, in that case, some of the broader points that distinguish it from Web2 going to Web3. Let's let's start there to give our audience, yeah.

06:44

Lawrence

Absolutely. So there's really one fundamental difference, and it's the ability to actually own something on the Internet that cannot be copied. So it's the ability or the functionality to create an asset that I can't copy, I can't send it to you. Unless you can't take it from me, I can't make a copy and send it to you and avoid the double spend problem, which is what financial intermediaries do today. They avoid the double spend problem by sitting in between and guiding that transaction or that asset from one party to the other. Now, on the internet, you can create this asset that cannot be copied, cannot be duplicated, and only you, and you alone can authorize the transfer of that asset.

07:53

JP

Fantastic. So you're talking about us having the ability to own something on the Internet in a digital space as a digital asset that is unique in itself, and that's the distinguishing fundamental where Web3 is concerned, is that right?

08:08

Lawrence

Absolutely. That is the first principle of blockchain, is that very concept. Without that concept, none of it would exist, and that's why none of this existed before Web3. So this invention that enables you to own an asset that's not copyable.

08:31

JP

Okay, so I want to dive a little further into the aspects that shifted from Web2 to Web3. Right. And in terms of the technologies that you've worked on before, how cutting edge is Web3 as we know it? Is it right at the forefront of everything that it should be? Have we already spent a decade into it and we don't know it yet? What are your thoughts?

09:02

Lawrence

10:25

Lawrence

11:37

Lawrence

12:41

Lawrence

So that's what they did. And so now we've come through these stages, which was basically kind of they were defying the regulations. Now we've moved to this thing where we've got a really good regulatory system behind us where that makes crowdfunding possible, that makes IDO platforms possible, like AdLunam. So before this was not in any way possible, but now the regulators can't keep up with it. They're totally marginalized from an economic perspective in countries, Africa, Indonesia. They can actually participate and invest their money in a project. And some are good, some are bad. And AdLunam, they're all good. No, really? Kidding. That's one of the most amazing things that have come out of the space, and that's why I'm involved with AdLunam, basically.

13:42

JP

Okay, Lawrence, thank you for that. Because for that, the analogy that you've given when it comes to development and you're saying that we are the advent of what steel is doing to the construction industry is what Web3 is going to do to the blockchain is going to do to the industry as a whole is phenomenal because the potential is endless.

14:06

Lawrence

Yeah, look at the skyscrapers now and see what's going on.

14:12

JP

All right, okay. So given that we're waiting to see these skyscrapers, right, you've also worked with Travelocity. You've sold Travel on the Internet, and then, of course, you've had Amazon that's done books and stuff like that. When it comes to Web3 for businesses, those that are going to transition out of Web2 as it stands. Lawrence, how do you see that transition? I know there are some use cases, and if you could dwell on that as well, but how do you see the transition really booming?

14:49

Lawrence

15:43

Lawrence

So they were software that you downloaded onto your computer, and one button looked one way one, and one button looked the other way. There was a million different ways the software could actually work with a browser. There was only one way click on a link. Okay, so that's where we're headed. We're not even close to being there, where when I say ubiquitous, meaning everyone understands it, everyone can use it on a browser. It's the same link, it's the same button. It just basically works the same way. So right now, with wallets and all of this stuff, we're just at the very Stone Age of the beginning of this, when it becomes ubiquitous to have a wallet, okay? When everybody has a wallet, everybody will understand a wallet. My grandkids will have a wallet. They'll understand it, they'll know how to use it. It'll be their identity, right?

16:41

Lawrence

A NFT will be their identity. You won't have to have 256 unique passwords that nobody can ever guess, and neither can you. All of that's changing, right?

16:53

JP

17:31

Lawrence

Yes.

17:33

JP

For businesses. Where do you see this trend going? Who else is going to join in?

17:38

Lawrence

Yeah. So this will be all the major global brands, right? Like you said, Nike, Puma right now, airBaltic. Check airBaltics NFTs, City NFTs. That is probably one of the greatest impacts that is going to have on the major companies that want to introduce their brands. So Qatar Airways right now has a metaverse where you can go in and you can book your flight, you can check your seat, you can navigate around. Banking will no longer be physical. The banking brands, you'll go into the branches on sandbox, Decentraland, wherever. And you'll go up to there and you'll open your bank account, there'll be an immediate hook up with a centralized exchange or a decentralized exchange for crypto. And I'm glad you touched on that because I would have forgot it. But that is such a huge impact and it's hard to take in, right? Because it's just like people buying profile pictures.

18:48

Lawrence

Right. So Bored Apes or why do they do it? Right? It's an emotional it's an emotional thing. Right. It doesn't make sense. It's like back in the old days, collecting baseball cards, physical baseball cards. Like, I own this guy. I own his little pose that he gave up for holding the bat. Or you guys, the cricket thing. So I own that. It's an emotional thing. And if you're not a collector or somebody naturally in that business, it's hard to understand. But once you buy an NFT, which you can see my NFT right there, it's called Nice Skunks. Once you do it becomes an emotional thing. And now I'm looking for more NFTs to collect. So that's a huge part of the business. I'd keep my eye on it.

19:40

JP

Right. That aspect of not just emotional. I mean, I'd rather focus it. It is first the emotional connection that you have with that digital asset, if you want to call it the NFT that you do. And then further, the use cases of whatever you feel emotionally connected to, like Nike shoes being used in the metaverse, for example.

20:02

Lawrence

Yes, exactly. And there's more to that than I even understand. But I'm excited about learning more about it. A lot of these major global brands, Gucci, they're all going to be in it. I think they maybe Gucci already is. I'm sure they are. Or that Birkin handbag and these things that's just going to explode. Jervis I think.

20:28

JP

Yeah, well, that is certainly something to look forward to from a personal point of view, from a generational point of view. Like you're saying that your grandkids are going to be having wallets and then NFTs for the 256 passwords that they never have to remember ever again. Right?

20:48

Lawrence

Yeah. I call it the username password hairball. Right. I might remember my password, but I can't remember my username. Or vice versa.

21:01

JP

Yeah, it is certainly one of the benefits that is going to be there. For sure. Okay. Lawrence, tell me something. With every new technology comes this fundamental of having the right kind of infrastructure. Right? How much more would it take for mass adoption of Web3 to occur in the entire scope that it should? Right. Do you see some limitations there? Are there some things that are already accelerating that putting it on?

21:39

Lawrence

No, I think the only thing is time. It's going to be faster than we think. You guys, you're younger, all of you. You probably use banking applications on your Internet. When I was in graduate school and all those you couldn't even dream to do that. I remember I'm a computer scientist, and it's very interesting. When I was working on my PhD in computer science, we got reports back that Japan actually had streaming video on their phones.

22:20

JP

Wow.

22:20

Lawrence

And our reaction, or my reaction as a computer scientist was that's not possible because there's not enough bandwidth.

22:28

JP

Right.

22:28

Lawrence

And basically didn't I mean, I did not believe it, but I'm giving all the reasons why they can't do that. But actually they were doing it. So that's what's going to happen here. It's just going to grow and open up, and it'll be just like you guys using the banking apps on your phone or buying travel. It'll be just that ubiquitous. But I think the element and remember that a lot of people jump ahead, and that's good. There's going to be 95% of the companies jumping into the Internet. When TCP/IP was there, they failed, okay? But they were probably jumping ahead. They were working on something that was going to come, but it just wasn't quite ready. But that's just the pain you have to go through to move forward in technology. So, listen, the future is bright for this, and it's where we all need to be.

23:32

JP

Well, certainly it's interesting you mentioned that I was reading a report quite recently saying that Second Life from Linden Labs, when it came out, it was one of the first experiences of people getting into the metaverse. Right. And in some way, though it had a million users at some point and dropped down to about 900,000, it was still a great gateway into what the potential could be and may also have paved in some way the building blocks to where we are today.

24:06

Lawrence

I totally agree with that. I mean, they were built in users already for the metaverse there for sure. And it kind of was a metaverse. It's just here's the difference between Web2.0 metaverse and Web3.0, that you can actually own an asset in Web3.0. So that's the difference. And I'll give you just an interesting story that I kind of learned along the way dealing with gaming, Play to Earn gaming. But one of the experiences I have with traditional gaming companies, like just the traditional gaming companies before Web3.0, Zynga, all these guys, okay, when they wanted to, guys would go in there and play these games for 10-12 years, and all of a sudden, actually, this is what happened to Vitalik Buterin with Ethereum, he was a big Dungeon & Dragons, I think, something like that. And all of a sudden, one day, they changed his asset.

25:06

Lawrence

They took his avatar and did something to his avatar, and he's like, whoa, I think there's a better way to do this. Right? And that was kind of the birthplace of Ethereum, okay. Because of course he knew about Bitcoin. But yeah. So the difference is you can't take that asset. Once I own that avatar right now. They're working on standards where my avatar can be used in different metaverses. And in fact, I wrote a paper on that. You can't take that asset away, so no company can take that away from you. So super interesting. Jervis on that front.

25:44

JP

Well, that certainly is. I mean, especially this transition from Dungeons & Dragons.

25:53

JP

That is, of course, a classic and a classic example. Lawrence, I want to pick your brain a little more for more cases that you may have come across that you'd like to share with us, please.

26:04

Lawrence

Sure. Oh you mean on what Jervis.

26:11

JP

So on interesting trends that you're seeing, interesting cases in Web3 that you're seeing. I mean, either from a transition point of view or a use case point of view in Web3 at this point.

26:21

Lawrence

Use case. Well, so we talked about crowdfunding that all of this basically is possible because of Web3 or blockchain. It just wouldn't be possible before then. Yeah. Also, the metaverse owning assets that can't be transferred, the fact that for the last years, all I've ever been paid in is crypto. So if somebody wants to pay me fiat money, I really don't even know how to do it anymore. So I mean, payments. Like, I'll give you an example. One of my former buddies is on this call right now, Valter from Slovenia. And we paid our developers. We have teams in Slovenia and Serbia. I ended up using, making them get one of these freelancer platforms so that I could pay with a credit card into that company, who then dispersed the money to them. I was paying like tens of thousands of dollars a month for that privilege just to get them paid.

27:40

Lawrence

Now we don't do that anymore. So that's just another use case. It's just like, listen, there's probably many more that I have no idea about, but I'm just keep your ear to the ... we're going to see them come through AdLunam. This is how you find out about these. Like this new one, what is it? STEPN? Yeah, where you basically move to earn all of these things. This is why AdLunam, you pay attention to the platform. We're going to bring in vetted projects and get good investors is the idea. And you'll see many new things coming along. Keep your mind open to them. Like I said, a large percentage will fail, but that percentage will go down and down as we move on into the evolution of the actual technology itself where everybody can use it.

28:37

JP

Certainly, Lawrence, I'm certain that's exactly what we're going to be seeing, because with launch pads like at Lunum, you're for certain going to be able to have access to interesting projects as they start from the idea and their evolution going forward.

28:55

Lawrence

Yes, exactly.

28:57

JP

Excellent. Okay, Lawrence, here's the last question that I have today, and then maybe we'll take a question from the audience as well. Now, if you had a chance to tell people who are not in the Web3 space yet, what would your message to them be?

29:23

Lawrence

Yeah, it's kind of like a normal user. I would get involved with the metaverses, like Sandbox, Decentraland know what's going on there because when you buy an asset there, it actually belongs to you. Look at the space as a whole. There's meme coins, we call them part of my language, shit coins. But there's ones with tremendous value there that do different things. Enjoy the space, watch the space. I'm not a degen myself, but there's a lot of people that just sit there and watch the prices go up and down and buy and sell and have fun with that. I think from investment perspective, one of the greatest things that you can actually invest for the first time, you don't have to go through a Merrill Lynch or an investment bank. You can actually look at projects and decide for yourself. You don't have to spend a lot of money and just enjoy the space and the evolution of the space.

30:37

Lawrence

31:45

Lawrence

This what Bitcoin is going down for a certain period of time, but I think eventually that's going to change.

31:56

JP

Exactly the more assets that you have a correlation to, especially when it comes to institutional investing. They, of course, would like to hedge their portfolios across various assets, digital commodities and so on and so forth. So certainly, Lawrence, that's a great insight for people who are introducing themselves to Web3 is like, you check out what exists, try to interact with it a little more, and then let it become a part of things that you do every day. And that's one of the ways that you can experience mass adoption, right?

32:33

Lawrence

Absolutely. And it's coming whether you're involved in it or not, right, unless you want to go live on a farm and cut off all telecommunication service. But it's coming and you can enjoy it. It's so funny. And this is the big difference, I think, between Web2, Web1.0 and Web3 that I see people in this space that know more, that they're not computer scientists, they're not technical people, that they know more than a lot of computer scientists about it because they get in there and they use it and they have wallets. So really super interesting, that's one of the major differences that I see is that non technical people can use this technology. And if you don't use it I'll tell you this, if you don't use it, you don't understand it. To me, it's impossible to understand unless you actually use it because it doesn't fit into any of the scientific scenarios.

33:43

Lawrence

Right, it doesn't. That's exciting as well.

33:49

JP

Well, certainly, I mean, that's the best way to experience something, the best way to get a hold of it, to understand what Web3 is and the impact it can have on your life, right? Okay, great. So, Lawrence, let's look at this. I wanted to get your friend on today, Walter, to maybe ask a question if he has something or a comment he'd like to share. Walter, if you may have a connection speaker request that's already come to you. In the meantime, though, I'm going to ask Nadja, who is the co-founder of AdLunam as well, if she has a question to ask you. Lawrence, Nadja, if you do, go for it.

34:31

Nadja

Awesome. Lawrence, thank you so much. This was joy. I absolutely love listening to you, and I could definitely listen to you all day. But so the question that I want to ask is, in light of the current market that we are facing, I mean, this is a prolonged bear market, and for those of us who have been in the industry for a while, we know that these cycles come and go. Some of them are definitely more difficult and prolonged than others, but we know that there's always sort of a rainbow at the end of the cloud. But for people new to the industry, what are your thoughts on how to navigate this? I guess emotional roller coaster of seeing markets go up and then also again, come crashing down. Because, of course, from your experience, having gotten into emerging tech so early in the 80s, in the 90s, when again, I can imagine, most people were saying, oh, this is never going to go anywhere.

35:28

Nadja

This is all a pipe dream. So you've been seeing this for decades. But of course, for people new to all of this, for them it's, oh, it's going to save the world, it's going to change the world, and the next second it all comes crashing down. So what would your advice be for people who are really just getting into crypto now?

35:47

Lawrence

Okay, so if you look at the technicals behind trading and pricing and all of that, because that's kind of what we're referring to here, you'll see that we're not out of whack with Bitcoin in terms of. All the bear markets and the bull markets. If you look back at the highs and lows and the periods in between, we're a little bit out of hack. Not out of hack but out of whack, so to speak. That's an American kind of colloquial expression, but we're a little bit out of that. But please keep in mind that we just are in the middle of a perfect storm, right, economically. So you've got all of this money that was run off during the pandemic, trillions and trillions, and not just the United States, every country in the world, which at the end of the day everybody knows that creates inflation.

36:46

Lawrence

Then you have the pandemic, which created a supply chain issue. So now you've got parts that don't arrive on time. So you got things that don't actually get there. So it's a supply side inflation. And then we've got a war that nobody anticipated. I didn't, I think other people did better than me. So you've got this perfect storm. You got three systems coming together to create this incredible perfect storm. I think you need to take that into account because that has overall impact on the crypto market has grown to be part of the institutional space, which is good and sometimes kind of bad, but nevertheless it is part of the institutional space now. And so all of that perfect storm creates cell pressure, et cetera. I'm believing that everybody's going to recognize that these blockchain, crypto. That's going to be the hedge against inflation. The problem is there's other things going on right now and it's going to be bad.

38:02

Lawrence

But it's our savior, basically. Blockchain is the savior of this situation that was coming and we're in it and so we're going to have to ride it out. Nadja.

38:18

JP

Awesome, thank you. Okay, well, yeah, go ahead, Lawrence, go ahead.

38:28

Lawrence

39:32

Lawrence

But he goes, what does that say? What says 64,000? So I'm like, oh so a Bitcoin. So what is that? Okay, I guess what I'm trying to illustrate here is it's the time frame that you look at, so always Bitcoin is going to go up in the end, it's going to go up. It's a scientific fact. It's a scientific invention that will continue to rise because now we have a digital gold and other digital assets. So there's nothing that's going to change that. From a technical perspective. We got to go through some hard times and some good times. Pretty much.

40:15

JP

Awesome. Thank you. Thank you, Lawrence, for that. I think that you also do kind of a correlation with Nadja's question to what essentially started out as the .com bust when that bubble exploded, but then that also gave rise to the real stronger players in the market for them to have some real value coming out of the IT industry at the time.

40:39

Lawrence

Absolutely. It's like Jeff Bezos, I mean amazon didn't make a profit till a couple of years ago. Fortunately, they were able to do their IPO, which we can do now with anything. They did their IPO pre .com bust. Right. So they basically banked billions and kept it in their treasury, didn't go out and spend it on a bunch of dumb stuff. And they started off selling books, which were kind of laughing about at the time, like, we're selling travel, you're selling books. And of course, now we're not laughing anymore. But here, he was able to ride all the storms because of the treasury. He could give your money back, keep giving you a good product, keep creating a good customer service effect, and the rest is history. Right. So that's it. And if you look at the .com bust, what we're experiencing right now is pretty much not even close to that.

41:47

Lawrence

These companies were spending millions on Super Bowl advertisements and things like this, having no idea all this was going to collapse. But then again, of course, after collapse, it started rebuilding itself. It's kind of like a phoenix burying the ashes, and the next one comes up gets better.

42:14

JP

Awesome. So that's exactly what we can expect from blockchain from the markets as it stands. And this is just the time in which the phoenix is preparing itself for its next flight.

42:25

Lawrence

Absolutely, Jervis. Absolutely.

42:29

JP

Okay. All right, Lawrence, thank you so much for getting on the show today and sharing your insights. I'm certain that everybody in the room, as well, has learned so much. Ladies and gentlemen, give us a reaction for Lawrence. Send us a heart, a clap, a peace sign. You have all those options available. So. Lawrence, thank you. Thank you so much for being here on the show. It was an absolute pleasure speaking with you today, and there was just so much to learn from your journey and the thoughts that you shared. So thank you once again, Lawrence.

43:00

Lawrence

I feel very privileged to get to talk on this subject at this point in time because it's an incredible time in history and it's going to democratize and give access to the unbanked peoples of the world their own and be able for them to be able to participate in the financial system and be able to invest. So I feel very privileged. Thank you guys for having me. Appreciate it.

43:25

JP

It was a pleasure. As all ours, Lawrence. Thank you so much. Ladies and gentlemen, thank you. This brings us to the end of our show for this week. Join us next week at the same time, same place on Diving Into Crypto. This is your host JP from AdLunam, Inc. Speaking to you about Web3 cheers.

43:43

Lawrence

Cheers. Bye bye.

43:45

JP

Bye bye.