Speaker 1: Hey, folks, we're recording at chain Links Smart Cohn and
Speaker 1: joining me is Jillian Friedman, who is the chief operating
Speaker 1: officer at Symbiotic. Jillian, great to have.
Speaker 2: You, Thank you for having me. Excited.
Speaker 1: Yeah, excited to dive into Symbiotic. I would love to
Speaker 1: start with your background, because you have a very fascinating background.
Speaker 1: You were in TRADFI, you also ran a debt, so
Speaker 1: tell us a bit about yourself there.
Speaker 2: Sure, I actually launched my career as a bitcoin lawyer
Speaker 2: back before there only was bitcoin, got to deal with
Speaker 2: all of those initial legal challenges around icos when Ethereum
Speaker 2: was launched in twenty fourteen. Sure kind of spent the
Speaker 2: first half of my career beating the crypto blockchain drum
Speaker 2: to the traditional finance world with varying degrees of success.
Speaker 2: And then as the I was the head of digital
Speaker 2: asset strategy at one of Canada's big banks. But right
Speaker 2: before Symbiotic, I was the COO and CFO of one
Speaker 2: of the first digital asset treasury companies called ether Capital,
Speaker 2: before they were a thing, and so really got to
Speaker 2: experience firsthand staking, institutional staking and like what that frontier
Speaker 2: looks like.
Speaker 1: That's incredible. You're an OG jillion, I'm old. Yeah, you
Speaker 1: I mean you're around when was just a bitcoin and
Speaker 1: then being early to dats as well is pretty cool.
Speaker 2: Yes, and a lot of the challenges related to dats
Speaker 2: as well. Yeah, it's been really interesting seeing the evolution
Speaker 2: from the institutional perspective, and like, you know, there's that
Speaker 2: expression that people people overestimate how quickly technology will impact things,
Speaker 2: and they underestimate what the impact will be. Sure, kind
Speaker 2: of burgering it, but like I think that's true. Right,
Speaker 2: like ten years ago, we were kind of just using
Speaker 2: different words for the same thing, Like they weren't RWA's,
Speaker 2: they were called something else. They weren't called stable coins,
Speaker 2: they were called something else. But it's really exciting now
Speaker 2: because you're seeing some of that stuff actually manifest So
Speaker 2: it's been really cool to watch.
Speaker 1: Is it validating for you, you know, being an OG
Speaker 1: and seeing all the adoptions happening, I would tradify it
Speaker 1: seems everybody is looking to integrate blockchain in some way
Speaker 1: or some fashion.
Speaker 2: It's definitely validating, And it's also I take things with
Speaker 2: a big grain of salt because I still believe that
Speaker 2: product market fit is a lot further away than people
Speaker 2: think for a lot of these different tech solutions. Sure,
Speaker 2: And what is exciting though, is seeing product market fit
Speaker 2: happen with, for example, stable coins, like we run almost
Speaker 2: our entire business on stable coin rails. Sure, that's really exciting.
Speaker 2: But yeah, so it's validating and it also gives like
Speaker 2: some perspective of like, okay, yeah, like some of this
Speaker 2: stuff is happening with some of this stuff is further
Speaker 2: away than we realize. Not from a tech perspective, Okay,
Speaker 2: it's really from a product market fit.
Speaker 1: And do you think the product market fit lag if
Speaker 1: you want to call it, that is related to lack
Speaker 1: of crypto legislation or clarity in addition to we're still
Speaker 1: in the trial and error phase for some of these things.
Speaker 2: I think it's a mix, regulation being one of them,
Speaker 2: but not the only one. Sure, if you're talking about
Speaker 2: like retail for example, or just mass adoption, the on
Speaker 2: off apps and like the ease of access is critical.
Speaker 2: If you're talking about capital markets, which is more I
Speaker 2: would say institutional adoption, and where I think, you know,
Speaker 2: like we could speak about symbiotic as well, and like
Speaker 2: what we're doing, there's there's missing, there's there's missing pieces
Speaker 2: that need to be built, but there's also like the
Speaker 2: need to and we're talking about this before, like communicate,
Speaker 2: communicate the opportunity and like switch things from very very
Speaker 2: technical to like speaking the language of whether it's capital
Speaker 2: markets people or martial bankers or etc. And like making
Speaker 2: them understand opportunity and vice versa.
Speaker 1: Yeah, it feels like some of that is happening, but
Speaker 1: it's not fully there yet.
Speaker 2: Like I think some of it's happening, yeah, and it's yeah,
Speaker 2: like the floodgates are open. I think this is the
Speaker 2: most exciting time, yeah, to be in crypto, other than
Speaker 2: like maybe ten plus years ago, when it was like
Speaker 2: everything was like the first time stuff was happening right,
Speaker 2: but it was still so uncertain, like is e theory
Speaker 2: I'm going to be a thing like what's bitcoin? Bitcoin's
Speaker 2: died like twenty times or something. Right to have to
Speaker 2: have the access that you have now and the political
Speaker 2: will that you have now and the regulatory clarity from
Speaker 2: like the world's biggest markets, absolutely can't like no better
Speaker 2: time to be in the space.
Speaker 1: It's exciting. And here in the United States going to
Speaker 1: you're not based in the United States, Here in Canada,
Speaker 1: we're waiting on that Market Structure Clarity Act, and I
Speaker 1: can't wait to see the innovation and the economic boom
Speaker 1: that comes from that once everybody knows what the rules
Speaker 1: of the role are.
Speaker 2: Yes, and I would qualify that with a with a butt,
Speaker 2: and I think this is happening. This is going to
Speaker 2: happen as well in Canada. There's actually a budget coming
Speaker 2: out today and it's very likely that there will be
Speaker 2: insight into how they plan to regulate stable coins and
Speaker 2: just the crypto markets in general. And take for example,
Speaker 2: the issue of yield bearing stable coins and the fact
Speaker 2: that in like the US bills, it seems like it's
Speaker 2: still still like complicated and unclear how an entity could
Speaker 2: issue and launch a yield bearing stable cooin on how
Speaker 2: that could like circulate in the market.
Speaker 1: Sure, and you.
Speaker 2: Know it's clearly like the banks and many financial institutions
Speaker 2: make a lot of money keeping that yield for themselves.
Speaker 2: And so this is another like, yes, clarity is important,
Speaker 2: but also like what type of clarity and what kind
Speaker 2: of like openness it creates for innovation and competitiveness in
Speaker 2: the market.
Speaker 1: Yeah, well, put, I think to your point, like the
Speaker 1: Genius Act was pastor in the United States, but there's
Speaker 1: still some pushback from some of the banks. There's still
Speaker 1: talks of how this will be implemented and executed and
Speaker 1: so forth. So it's still still some work to be done. Sure,
Speaker 1: I want to make sure we are able to talk
Speaker 1: about symbiotic. Yeah, what is symbiotic?
Speaker 2: Okay, So symbiotic is universal staking framework. We built the
Speaker 2: rails to enable assets on chain that are not being utilized,
Speaker 2: to enable them to become productive by securing or underwriting
Speaker 2: risk on chain. And so think of like symbiotic as
Speaker 2: the progression of staking into the establishment of risk transfer
Speaker 2: markets on chain, which, like circling back to what we
Speaker 2: were talking about before, is really a critical piece for
Speaker 2: a capital markets ecosystem to thrive on chain, whether that's
Speaker 2: DeFi or the next like iteration of DeFi. Sure, so
Speaker 2: like kind of v one of like the staking primitive
Speaker 2: was eth staking, like just proof.
Speaker 1: Of steak right.
Speaker 2: Version two restaking, which is what we are involved in,
Speaker 2: which is taking staked capital or even unstaked capital, but
Speaker 2: as it's on chain. Even now with bitcoin, we have
Speaker 2: a number of vaults that have wrapped bitcoin that are
Speaker 2: securing via staking, not just networks, but a whole range
Speaker 2: of on chain activities, whether it's like fast finality, interoperability,
Speaker 2: data availability, and then version three or what we're building
Speaker 2: towards is now additional like financial products.
Speaker 1: And you mentioned wrap bitcoin, you mentioned e theorem. Are
Speaker 1: you supporting a variety of proof of steake blockchains like
Speaker 1: Solana and others.
Speaker 2: So the great thing about our infrastructure is how modular
Speaker 2: it is and composable, like not to drop a bunch
Speaker 2: of buzzwords, but like it actually accurately describes the symbiotic stack.
Speaker 2: So it's really designed for any any chain, network or
Speaker 2: activity that requires some sort of economic security can leverage
Speaker 2: our plumbing to plug into economic security so long as
Speaker 2: there is capital willing to secure that activity.
Speaker 1: Got it. So you're very much interoperable with many different
Speaker 1: block chains. You're kind of infrastructure for staking essentially and
Speaker 1: giving a broader reach for ye.
Speaker 2: It's basically like proof of steak as a service in
Speaker 2: a way that's actually interoperable. Because we see the way
Speaker 2: that the space is evolving. Interoperability is super important. Projects
Speaker 2: are being built in an interoperable way. Sure you know
Speaker 2: you can stake once secure many chains. We're also we've
Speaker 2: announced I think last week or maybe it was this week,
Speaker 2: a new endeavor with chain Link and Solve. A couple
Speaker 2: of weeks earlier was with chain Link and Lombard. And
Speaker 2: so are users that are utilizing like the c c
Speaker 2: IP interoperability can plug into symbiotics shared security two secure
Speaker 2: like the data that's being executed and moved around there.
Speaker 1: Oh sure, and your your infrastructure that can be used
Speaker 1: by institutions globally if whether it be in a crypto
Speaker 1: exchange or a black rock or things like that.
Speaker 2: Of course can be used by It can be used
Speaker 2: by anyone. And I think what's really interesting about having
Speaker 2: institutions be getting to the point that they can operate
Speaker 2: in the restaking or universe staking world is that they
Speaker 2: bring a certain flavor of expertise that will be very
Speaker 2: useful for the next generation of activities that are being
Speaker 2: secured or underwritten via staking. So imagine collateral guarantees of
Speaker 2: credit facilities. That there's a credit facility, if there's a
Speaker 2: default on the credit, there's a guarantee or like some
Speaker 2: people call it insurance, but really a guarantee that is
Speaker 2: represented via a vault that has assets in it. And
Speaker 2: so those assets get paid out a yield as part
Speaker 2: of like the interest payments. But then if there's a
Speaker 2: default on the credit facility, then those assets would get
Speaker 2: like slashed or they wouldn't be burned, but they would
Speaker 2: be like redistributed back to the original lender. This is
Speaker 2: the type of thing that traditional commercial lending markets have
Speaker 2: been engaging in for centuries, like having the concept of
Speaker 2: like guarantees on loans.
Speaker 1: Sure, we're just.
Speaker 2: Like optimizing it for DeFi and a permissionless market.
Speaker 1: That's great. I know institutions and even look the average
Speaker 1: show all us in hunt for yield and had to
Speaker 1: get the most interest because banks they're not giving as
Speaker 1: much interests anymore. And I personally steak and I earn
Speaker 1: more interest than I do from my savings account. So
Speaker 1: that's really great. And are you able to say what
Speaker 1: type of institutions are using your service? Any names that
Speaker 1: you can drop, It's okay.
Speaker 2: If not, so it's like yes and no. The reality
Speaker 2: is our service is permissionless. Okay, so we know through
Speaker 2: for example, one of our newer would I would to
Speaker 2: say products, but newer types of services that are infrastructure
Speaker 2: securing is called CAP and that's really we're underwriting stable
Speaker 2: coin yield strategies and a number of their partners are
Speaker 2: like traditional financial institutions. I think Franklin Templeton is one
Speaker 2: of them, and so like we welcome any partner or
Speaker 2: whether it's traditional finance, a partner of traditional finance to
Speaker 2: come and build on Symbiotic. You know, right now most
Speaker 2: of the interactions are with more DeFi native, but we're
Speaker 2: starting to see that change, and like hopefully we'll have
Speaker 2: some announcements soon, but I can't really share.
Speaker 1: Yeah, well, on a note, what are some of the
Speaker 1: things that are on your roadmap that we could potentially
Speaker 1: expect in twenty twenty six.
Speaker 2: Yeah, so definitely some things to be excited about is
Speaker 2: the transition towards additional yield. A lot of a lot
Speaker 2: of projects that will be generating fees or like having tgs,
Speaker 2: which means that if you're staking or restaking to secure
Speaker 2: these networks, like the yield that you generate will become
Speaker 2: more interesting. Sure, we're also really excited about this expansion
Speaker 2: of the use cases with our tech infrastructure. So like
Speaker 2: we started with restaking to secured networks and various like
Speaker 2: blockchain activity, now it's transitioning first with cap but soon
Speaker 2: with others to be announced to underwrite or secure financial activity.
Speaker 2: And so so we have the tech, we have the
Speaker 2: infrastructure to do that. We have like proof of proof
Speaker 2: of concepts or like a great very successful product market
Speaker 2: fit there with underwriting these stable coins and so that's
Speaker 2: you know, an area that we're actively building building into.
Speaker 1: This may seem like a silly question, but I'm very
Speaker 1: curious about it. So you mentioned like wrap bitcoin, stable
Speaker 1: coins and so forth, and outside of just regular proof
Speaker 1: of steak blockchains like Ethan Solona that where you can
Speaker 1: earn off the network. Is does this infrastructure allow to
Speaker 1: pretty much wrap anything like even tokenized assets and put
Speaker 1: it to work.
Speaker 2: Yeah, I mean, like in short, the answer is yes.
Speaker 2: You know, we say, like you can stake almost any
Speaker 2: asset to secure almost any network without getting into like
Speaker 2: the technical components, which I can't I'm not the best
Speaker 2: person to speak to about that. But really the the
Speaker 2: the answer is more about demand and interest, like is
Speaker 2: there appetite or an interest to secure a network with
Speaker 2: like an RWA that represents ownership in a condo association?
Speaker 2: Is there? Like it's it's really more about like the tech,
Speaker 2: the tech can do almost anything. Like that's that's not
Speaker 2: the the obstacle or the thing that we need to
Speaker 2: stop and think about. It's really about PMF and about
Speaker 2: finding the right like commercial sweet spot for for how
Speaker 2: to best utilize these assets. Like an easier example with
Speaker 2: that is even stable coins, stable coins proxy for the
Speaker 2: US dollar. It's it's sort of it's a question of
Speaker 2: like cost of capital, like can you if you can
Speaker 2: generate whatever like money market yield is in an account
Speaker 2: through a money market account, or even like chain, what's
Speaker 2: the how does that compete with like the yield that
Speaker 2: you would get by restaking a stable coin. And up
Speaker 2: until recently, like that analysis has resulted in like stable
Speaker 2: there's not like a ton of stable coins and restaking
Speaker 2: to get yield. Okay, I think that will change, sure,
Speaker 2: but you know, it's it's a question of economics as well.
Speaker 1: Yeah, yeah, that makes sense. I'm excited for the future
Speaker 1: of staking. You know, at one point here in the
Speaker 1: United States that got shut off.
Speaker 2: I know, it's crazy.
Speaker 1: Yeah, it's been turned back on. Yeah, but what do
Speaker 1: you think the future of staking looks like? I know
Speaker 1: that's a very open ending question and very macro, but
Speaker 1: you know, what let's say twenty thirty twenty thirty five,
Speaker 1: with more people are coming on chain, how do you
Speaker 1: think they interact with steaking?
Speaker 2: Okay, like this is one take, could you know, finger
Speaker 2: to the wind, crystal ball. I don't hold me to it,
Speaker 2: but I think like the definition of what staking means
Speaker 2: is evolving to like really just reference the concept of
Speaker 2: allocating something of value to a certain activity or to
Speaker 2: ensure underwrite a certain activity, and then in return for
Speaker 2: yield with the and the risk exposure is slashing. Like
Speaker 2: I find staking, the concept of staking, the concept of slashing.
Speaker 2: The concepts of like rewards or like they have all
Speaker 2: versions in traditional markets and in like financial structures that
Speaker 2: have been around for a long time. So I think
Speaker 2: the future of staking is to absorb more of that
Speaker 2: that type of activity, and so could mean more than
Speaker 2: just securing a network and curing transactions and validating transactions.
Speaker 2: It could mean underwriting as I mentioned, like credit markets,
Speaker 2: it could mean ensuring a whole range of different types
Speaker 2: of activities, whether it's on chain or off chain. Sure,
Speaker 2: and so that's how I see staking evolving. And then
Speaker 2: and of course with restaking to also secure networks and
Speaker 2: like the backbone of blockchain is economic security, so staking
Speaker 2: will always be there. It's like a question of like
Speaker 2: how much can we optimize it, Like vanilla steaking is
Speaker 2: like step one, right.
Speaker 1: Yeah, yeah, I'm curious to see how it evolves, especially
Speaker 1: when institutions coming in and then having a more global
Speaker 1: or having more participants globally in the crypto asset class.
Speaker 1: So it's exciting, yeah, bullish, Yeah for sure, Jillian, Thank
Speaker 1: you so much, looking forward to the future updates around Symbiotic.
Speaker 1: Thank you so much for taking the time. Thank you
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