Building the World’s First On-chain Order-book Exchange to Allow Users Full Control of their Crypto Assets, with Vitali Dervoed @ Spark

[00:00:01] Hello, everybody, and welcome to the Crypto Hipster Podcast. This is your host, Jamil Hasan, the Crypto Hipster, where I interview founders, entrepreneurs, executives, thought leaders, amazing people all around the world of crypto and blockchain. And today I have another amazing guest. He is the CEO and co-founder of Spark. His name is Vitali Dervoed. Vitali, welcome to the show.

[00:00:30] Hey, Jamil. Thanks for inviting me. Great to be here.

[00:00:35] You're very welcome. I'm very happy to have you here. And yes, I'm looking forward to talking to you today. And let's kick things off if you're ready.

[00:00:45] Yeah, sure. Let's do.

[00:00:47] Cool. So first question I ask everybody is, and I get all kinds of amazing answers, is what is your background and is it a logical background for what you're doing now?

[00:01:00] Yeah, absolutely. So I started building software 20 years ago. I had a service company. And somehow very early days it was already fintech.

[00:01:11] So I can easily say that I'm almost 20 years in fintech. Initially, I started building very small applications in .NET and Silverlight, also HTML.

[00:01:23] There were these Microsoft Mobile BOM computers with styluses, and we were building for those. But that was already somehow finance related.

[00:01:33] My first largest customer was Allianz. I think I was 22 at that time. And we were 32 people already.

[00:01:46] And I remember that the entire dev shop was sitting on Allianz. And then Allianz said, Vitaly do one more business.

[00:01:52] And they introduced us to a bunch of other German banks. With Allianz, we were mostly building apps, websites, client server integrations, APIs, mostly on backend.

[00:02:05] And honestly, that knowledge still relates to me today. Because blockchains are distributed databases in its core, plus a lot of plugged infrastructure.

[00:02:15] So in certain sense, my life didn't change much ever since. And we worked with other German banks.

[00:02:27] There were a lot of international integrations, like with Settling Bank, that's the French, with the Chinese, with the Russians, with the Koreans, with the British as well.

[00:02:44] British banks. So that's how I learned how bank industry is even composable.

[00:02:51] I can relate to today's comparison. A lot of people say that blockchain liquidity is fragmented.

[00:02:59] Well, it was for a while fragmented across among the banks as well, until it got composed.

[00:03:06] Systems like Swift totally helped to do that.

[00:03:11] And I got introduced by friends of mine to crypto in, I think, 2016 for the first time ever.

[00:03:20] And I didn't have any interest.

[00:03:23] Okay, that's like some magic internet money, no problem.

[00:03:27] There was a lot of stuff like that all along my career.

[00:03:31] And I didn't pay a lot of attention again to this.

[00:03:34] And then by 2018, we were building a lot of stuff in crypto.

[00:03:43] First, web applications, web2 apps, so to say.

[00:03:48] And then we also started building in Solidity.

[00:03:51] We were building apps for the, well, ICO giants, for the people who raised during ICO era.

[00:04:00] And then also Ethereum scalability solutions.

[00:04:02] Mostly Plasma.

[00:04:04] Everyone was building Plasma at that time.

[00:04:06] Polygon was also Plasma initially.

[00:04:09] One of the ICO giants acquired this company from me in 2018.

[00:04:16] And I had a new team.

[00:04:18] Like I took four people from our original crew.

[00:04:23] And we started building Plasma.

[00:04:25] And then I think in early 2021, I joined Neon EVM team.

[00:04:35] It was Solana EVM composability layer.

[00:04:39] Like Aurora on Nier as well.

[00:04:42] And I was building in Solana for a couple of years.

[00:04:45] My largest gigs in Solana were, well, Neon.

[00:04:48] Then I was working at Rockaway X.

[00:04:50] That's a VC fund.

[00:04:52] And I was doing growth at Mango Markets.

[00:04:55] And I was also working with a bunch of other Solana ecosystem projects.

[00:04:58] But that's kind of normal.

[00:05:00] Especially during the bull runs.

[00:05:03] And Spark is a logical continuation of my previous experience.

[00:05:08] Because I had a lot of knowledge in the infrastructure.

[00:05:10] While building Neon, I learned a lot.

[00:05:13] And, well, how to run an order book exchange.

[00:05:19] I thought, why not combine all this knowledge into something that...

[00:05:24] Why not synthesize this into something like Spark?

[00:05:28] So, over the last couple...

[00:05:31] Like fast forward till now.

[00:05:32] We launched in Maine.

[00:05:33] Okay.

[00:05:33] We were building Spark for almost two years.

[00:05:38] I don't want to dive into, well, technicalities for now.

[00:05:41] But I can.

[00:05:43] Yeah.

[00:05:44] Sure.

[00:05:44] If you'd like to.

[00:05:44] Yeah.

[00:05:45] Absolutely.

[00:05:45] The next question is going to be, what is Spark all about?

[00:05:47] If you want to get into technicalities, that would be great.

[00:05:50] Yeah.

[00:05:50] So, why Spark is cool.

[00:05:51] And Spark is an order book-based exchange.

[00:05:55] It's a spot and perp exchange.

[00:05:58] Spot is live.

[00:05:58] Perps will be live shortly.

[00:06:00] We're going to release the first version before the new year.

[00:06:03] Like between Christmas and New Year.

[00:06:05] And we're going to ship the entire product, I guess, throughout January.

[00:06:10] We're shipping one new feature or update every week now.

[00:06:14] Like, for instance, this week we're releasing a dashboard.

[00:06:17] We're improving the liquidity.

[00:06:18] We're adding a couple more markets on Spark.

[00:06:22] And next week we improve, again, the depth of the liquidity.

[00:06:26] And we lift this beta thing that is right now there in the interface.

[00:06:32] We improve the SDKs.

[00:06:34] Right now it has two SDKs, TypeScript and Rust.

[00:06:38] We're also adding Python support in just a little bit.

[00:06:41] So, there's a lot of work going on.

[00:06:48] So, on Solana, for instance, there was a project called Serum.

[00:06:52] And Serum inspired us to create Spark on Fuel.

[00:06:58] I explain why we even decided to build this thing.

[00:07:02] So, the problem that Ethereum was facing two years ago and still faces today is the adoption.

[00:07:10] We've heard a lot about it.

[00:07:11] Like, hey, Solana is an Ethereum killer.

[00:07:13] When you say Ethereum killer or when you say, like, this blockchain is killing this one, it means it's killing in the adoption.

[00:07:21] Okay?

[00:07:21] It's bringing new people.

[00:07:22] It's bringing new users.

[00:07:24] Here is the thing.

[00:07:25] So, Ethereum has built a lot of epic projects like Aave, Uni, Balancer, a bunch of other AMM-based protocols.

[00:07:34] And the customers are mainly LPs.

[00:07:37] Who are the LPs in Ethereum?

[00:07:40] Two types of users.

[00:07:42] Institutions and retail.

[00:07:43] Institutions are the trading firms like Wintermute and others who put their passive liquidity into AMMs, into the pools and get the yield.

[00:07:53] Get the, well, passive income, so to say.

[00:07:58] And retail.

[00:08:00] And when we say retail, we're targeting the largest of them.

[00:08:05] We're targeting the whales, right?

[00:08:06] We aren't targeting the tuna.

[00:08:08] So, Ethereum whales are, well, ETH holders that are the OGs who bought Ethereum early days and were holding it.

[00:08:15] And they have a lot of it and they have just too much liquidity to constantly hold it.

[00:08:21] So, they decided to, well, why don't I use the, like, great Ethereum ecosystem?

[00:08:26] I can stake.

[00:08:27] I can pull this liquidity.

[00:08:29] I can, again, put it into the lending pool.

[00:08:32] So, that's the customers that these protocols are chasing today.

[00:08:35] Ethereum whales.

[00:08:36] And that was it.

[00:08:39] And essentially, nothing happened after that.

[00:08:43] Ethereum started chasing, well, scalability after that.

[00:08:48] And scalability on the technical level.

[00:08:50] So, it started building, like, L1s, L2s, etc.

[00:08:53] Not on the application and not on the user level.

[00:08:57] So, when I say we're bringing adoption to Ethereum, it means we're bringing users.

[00:09:02] Here's the thing.

[00:09:03] Solana is sitting on completely different user groups today.

[00:09:07] These are people who are using, who are extracting the revenue through active liquidity.

[00:09:15] And the most-star metric that Ethereum is chasing are, well, TVL, right?

[00:09:20] And, like, annualized yield.

[00:09:23] Solana is sitting on volumes, for example.

[00:09:26] And any other high-throughput chain would be sitting on the volumes.

[00:09:30] If you say, what's your...

[00:09:32] You never ask, what's your, like, meme coin TVL?

[00:09:36] That's impossible.

[00:09:37] This metric is too volatile to even focus on.

[00:09:41] You can ask, how much money did you make on trading the meme coins?

[00:09:44] So, when we ask this, we normally kind of mean order book-based DeFi.

[00:09:49] Because you're trading them on the order book.

[00:09:51] So, order book is this tool that improves price discovery for any asset.

[00:09:57] Order book is a very ancient tool.

[00:09:59] All the exchanges initially used the order book.

[00:10:02] It's like, it's a book of orders.

[00:10:04] It was invented in 1500s in the Netherlands and didn't change a lot in its logic.

[00:10:11] It was just, like, digitalized and we had digital exchanges like Tokyo Stock Exchange or New York or NASDAQ, etc.

[00:10:21] Well, today it all exists on the blockchain.

[00:10:23] Initially, and the first project that has built an on-chain order book was Serum on Solana.

[00:10:30] And Mango, where I was also involved, was using Serum order book.

[00:10:35] Serum had a bunch of problems.

[00:10:37] Serum token wasn't very efficient.

[00:10:39] It was inflational.

[00:10:42] And Solana had this binary search tree entirely sitting, sorry, Serum had entirely on-chain binary search tree.

[00:10:51] It was causing state bloats.

[00:10:55] So, how do I explain it in a simple way?

[00:10:58] So, binary search tree is like a tree of hashes, right?

[00:11:03] Like, people create transactions.

[00:11:04] They create orders.

[00:11:06] And then this tree can, well, it represents a matching engine that matches those transactions.

[00:11:11] For instance, I'm selling one Bitcoin and there are 100 people willing to buy an amount equal to one Bitcoin.

[00:11:17] So, this binary search tree matches these orders because it has all the data about it.

[00:11:23] And it happens entirely on-chain.

[00:11:25] Thing is that you need, as you can guess, a lot of computation to match them.

[00:11:31] So, you need, like, big server, big expensive machine.

[00:11:35] And when you run those servers, your validator economy is, well, you have to think about it quite a lot.

[00:11:42] You need to mine it.

[00:11:43] And that's what is causing Solana to crash sometimes, even today.

[00:11:48] And recently we've seen Sui crashing.

[00:11:50] That's the same kind of thing.

[00:11:51] So, on Spark we decided, why don't we remove this part from, well, the chain and build a more lightweight design.

[00:12:01] And we started thinking, okay, what can we do?

[00:12:04] We can build, like, our super well-optimized virtual machine and then, well, rebuild Serum and bring it there.

[00:12:12] Or we can find a virtual machine that can support different types of stateless design.

[00:12:18] So, Fuel has a very cool feature.

[00:12:23] It's called predicates.

[00:12:25] Every virtual machine today can support, it's called stateless transactions or atomic transactions, depending on the chain.

[00:12:37] So, there's a stateless way to match the orders.

[00:12:41] And then you fetch the state, you fetch the order information from the indexer.

[00:12:47] Thing is that you need a bulletproof indexer in this particular case.

[00:12:52] So, Spark is a very lightweight contract, right?

[00:12:55] That matches the orders.

[00:12:56] We have a deposit function, which, like, when you click create order, you deposit funds into the order book.

[00:13:03] Then it has a match function.

[00:13:05] Again, the matching is happening on chain.

[00:13:07] And you have withdraw and withdraw all.

[00:13:09] And that's about it.

[00:13:11] We are fetching the information about the orders from the indexer.

[00:13:15] Right now, we're using two super strong indexers, Pangea and Envio.

[00:13:23] Our team is based in Lisbon.

[00:13:25] And Pangea team is also based in Lisbon.

[00:13:27] So, we can easily meet sometimes and discuss business-related stuff.

[00:13:32] Honestly, we have a solid builder community here.

[00:13:34] And we have a data relayer, Spark Middleware, that relays the transactions among those indexers.

[00:13:41] So, if one dies, another one picks up the transaction and sends the reply to the frontend or SDK.

[00:13:52] And this is what we have right now.

[00:13:54] This is what is powering our SpotExchange.

[00:13:57] This is what is powering our order book.

[00:14:00] Perps built like this will also be, again, pretty lightweight.

[00:14:06] I'll give you an example.

[00:14:07] So, there's GMX, for example.

[00:14:09] If you rebuild GMX to sway the programming language that we use, or if you compare a code base of Spark and GMX, even like that.

[00:14:17] GMX has about 10,000 lines of code.

[00:14:20] So, Spark has around 2,000 lines of code.

[00:14:23] So, when you're using Spark, you're deploying less computation.

[00:14:28] And it costs less to trade on Spark.

[00:14:34] We have a cool roadmap that will help us optimize even further.

[00:14:38] But even now, it's a pretty powerful machine.

[00:14:41] It's like 10 times cheaper than Solana.

[00:14:43] It's 100 times cheaper than Arbitrum or any other EVM-based L2.

[00:14:49] And it's all achieved because we're leveraging fuel stack, fuel VM.

[00:14:57] So, again, it might seem exotic as a technology.

[00:15:01] But when DYDX launched their order book on StartNet, which was like 10,000 times less powerful than Spark today,

[00:15:09] it was also surprising to me how they have rebuilt everything from Solidity into Cairo programming language.

[00:15:17] Well, today, I'm not surprised.

[00:15:47] Interesting.

[00:15:49] So, if you can't do that, if Ethereum can't scale, then what happens?

[00:15:53] Does Solana win?

[00:15:54] What's the end result?

[00:15:57] So, here's the thing.

[00:15:59] I spent a couple years thinking about how we scale Ethereum on the technical level.

[00:16:04] But today, I'm mostly focused on the users.

[00:16:07] So, I will tell you this.

[00:16:10] You can imagine scalability very easily.

[00:16:14] People say that growth lies outside the comfort zone, right?

[00:16:18] And I've been to Bangkok to this event called DeFi Renaissance, organized by probably the best event team.

[00:16:28] ABE, like Headsoft, they built great events.

[00:16:30] Thing is that I came there and I see the same people as on any other Ethereum DeFi event.

[00:16:37] If you go to Solana Breakpoint, if you go to Sui or Aptos Hacker Houses, you see a completely different group of people.

[00:16:44] And they are using the blockchains in a different way as well.

[00:16:47] I mentioned before that Ethereum is chasing TBL.

[00:16:50] So, if you start, if you go head-on Uniswap today to compete with them, you're going to lose.

[00:16:58] There's no way you're going to win.

[00:16:59] If you build something that is completely different, that is disrupting Uniswap,

[00:17:03] and if you bring a completely new group of users, you might scale Ethereum and bring another wave to adoption to it.

[00:17:12] I only see three L2s, three VMs that can power the next wave of adoption for Ethereum today.

[00:17:21] That's Eclipse, Fuel, and Movement.

[00:17:24] Why?

[00:17:25] Because, again, they're bringing a completely different group of users to the blockchain industry, to the Ethereum community.

[00:17:33] Here's the thing.

[00:17:35] The existing Ethereum users have to accept the fact that they need to scale.

[00:17:39] And they have to accept that this generation of the users will be very different from them.

[00:17:50] But this new generation of the builders is also playing by the rules that the OGs have created in this space.

[00:17:57] So, it's a generational conflict that is right now being, well, that has grown within the Ethereum ecosystem.

[00:18:07] But I think it takes a little bit of time and the community will accept it.

[00:18:12] So, that's how I see scalability today, bringing new users, bringing fresh blood.

[00:18:17] Spark is doing exactly this.

[00:18:18] Our users are order book-based traders.

[00:18:22] They aren't LPs.

[00:18:24] They're mostly.

[00:18:24] So, order book-based trading today in DeFi is sitting on very basic algorithms.

[00:18:30] You've seen a lot with AI agents recently.

[00:18:33] There was a lot of talks about the AI agents powering the markets.

[00:18:40] That's because this stack is so simple.

[00:18:44] So, Hyperliquid last week, I think, marked the beginning of the order book DeFi era in, well, in the industry overall.

[00:18:53] It showed many cool practices like launching a token on-chain, launching a protocol token on your own order book.

[00:19:03] Again, it's a fair launch, completely community-driven.

[00:19:06] It allowed to set the fair price again.

[00:19:12] It's a perfect launch.

[00:19:13] It's disrupting the industry in many ways.

[00:19:17] It's disrupting the centralized exchange business because now you don't have to overpay them for listing your token.

[00:19:24] You can list it on-chain, essentially.

[00:19:29] You don't need to overpay the market makers and you don't need to engage in these crazy talks about the KPIs.

[00:19:39] You don't have to watch if they fulfill those KPIs.

[00:19:41] You can launch it on the order book, run your strategies, like run your algorithms that are open source.

[00:19:49] And it's going to do the job just fine.

[00:19:54] And lastly, I think, entire meme coin season was leading to exactly this.

[00:20:00] Because Hypercentral used all the best practices of the meme coin launches by, well, giving the token to the...

[00:20:07] You don't have to be afraid that the VCs will come and dump on you, right?

[00:20:12] So why would I increase the volumes on this asset?

[00:20:15] Anyone would think.

[00:20:17] If I know that there are insiders holding massive amounts of that token and they will be...

[00:20:24] It's the game of who dumps first, essentially.

[00:20:26] While if the token is entirely community-owned, I don't have this fear.

[00:20:31] I can trade more.

[00:20:32] I can increase the volumes and I can increase the revenue for everyone else.

[00:20:36] So hype also disrupts the VC industry.

[00:20:39] And all of this wouldn't be possible without the tools like on-chain order books.

[00:20:46] Now it's just improvement of this stack of, well, building the community, etc.

[00:20:53] Now we can build your business on-chain.

[00:20:57] Spark, I think, is scaling exactly this model.

[00:21:02] So now it's all about why would I list on many centralized exchanges if I can list on many venues like Spark instead.

[00:21:09] Right.

[00:21:09] And again, if my goal, if the goal of the majority of the developers is to power the runway, then that's the perfect way to launch a token.

[00:21:22] Yeah, that makes sense.

[00:21:24] That makes a lot of sense.

[00:21:25] You know, it's interesting you said that, you know, the new users and builders and there's a generational conflict.

[00:21:31] I mean, this whole industry is built on generational conflict, right?

[00:21:35] Right.

[00:21:36] You know, you came in 2016, I came in 2017, and we both said the same thing.

[00:21:41] You said the same thing I said years ago, and that's a blockchain is a decentralized database.

[00:21:46] And I thought Bitcoin was a decentralized database, but I stepped into this world of generational conflict.

[00:21:52] Right.

[00:21:53] So that's what it is, you know.

[00:21:56] But it is important for retail to have, you know, access to better infrastructure too, right?

[00:22:02] Right.

[00:22:03] So why, like, most retail I know care about price and price go up and meme coins and meme coin price go up.

[00:22:11] But why is it important for retail to have better access to better infrastructure?

[00:22:18] Infrastructure like on ramping or trading or like price articles?

[00:22:25] What exactly do you mean?

[00:22:27] Any of that.

[00:22:28] What's your take?

[00:22:34] Well, I think it's a never ending story of innovating, I guess.

[00:22:48] And retail.

[00:22:50] Well, there will never be a perfect wallet.

[00:22:53] There will never be enough decentralization.

[00:22:55] There will never be.

[00:22:56] Also, when you work with the traders, like, for instance, our customers, they are, I would say, greedy people.

[00:23:05] Or like, I can just call them perfectionists.

[00:23:08] But greed is definitely what is powering this industry.

[00:23:11] Thing is, if you minimize the latency, it's never too good.

[00:23:16] You give them like one nanosecond finality and they will still tell you, no, that's too slow.

[00:23:24] So latency became this meme, I would say.

[00:23:27] It's never too fast.

[00:23:29] And then you say, okay, we subsidize gas fees entirely.

[00:23:32] So it's free forever.

[00:23:34] You don't have to worry about the gas anymore.

[00:23:36] And they will still tell you that's too expensive.

[00:23:40] Well, what can I do?

[00:23:41] Well, you can incentivize us to stay on your venue.

[00:23:46] Essentially pay us to trade more.

[00:23:48] Okay, how much do you want to be paid?

[00:23:50] Like, all your money.

[00:23:52] That's like, it's never enough, you know?

[00:23:54] How much do you have?

[00:23:57] For the meme coins, again, I think the majority of the people came to this industry to get rich fast.

[00:24:06] They didn't come to improve your product, for God's sake.

[00:24:12] And if you ask like anyone, what do you want?

[00:24:15] Well, I want more money.

[00:24:16] I want more assets.

[00:24:19] And then you think, all right, if you want more assets, then how do I provide you the best safe, still like secure experience to trade those meme coins, which we will also mint on the blockchain, on the DEXs.

[00:24:34] And give all of you, well, I need powerful oracles that fetch the price super fast and update it on like across all the venues.

[00:24:42] And they need to be secure at the same time.

[00:24:44] So they better fetch the price from several exchanges, right?

[00:24:50] And they need to list so fast that this price discovery is happening across many venues and is updating the feeds among those venues as well.

[00:25:02] And then you think, okay, if it's done in a permissionless way, if people list in a permissionless way, then how can it be secure enough?

[00:25:15] All these questions are like daily routine that you're asking yourself and you need to constantly move fast to not even reply them, but to, well, make it happen.

[00:25:26] Indexing and trading is huge.

[00:25:27] Like Solana has 17 indexers today.

[00:25:31] It's, again, it's so important.

[00:25:34] And we spend so much time building solid indexers that it's a meme by now.

[00:25:40] Like indexers are the APIs between a database and your product.

[00:25:45] They have been existing also in the TreadFi exchanges for a while.

[00:25:52] So, person who builds a blockchain comes to a conference and tells, okay, I'm building the future.

[00:25:58] This is the future.

[00:26:00] Like, I'm so good.

[00:26:02] You can't deny it.

[00:26:03] Whoever it is.

[00:26:05] And yeah, I kind of agree with you.

[00:26:07] Your blockchain is perfect.

[00:26:08] It's great in every way.

[00:26:10] Now, how do I fetch the data and put it into my exchange?

[00:26:13] How do I give it to like show, you know, the volumes or Ethereum price in my interface?

[00:26:20] Well, you need an indexer for that.

[00:26:22] And then all the blockchain builders are committing this mistake all the time.

[00:26:28] I cannot understand why, but I see it like happening every year.

[00:26:32] They start building their own indexers.

[00:26:35] Like, this is why.

[00:26:37] Because, oh, well, I've raised 100 million.

[00:26:39] I can afford it.

[00:26:40] Why would I pay 500k to an indexing team to bring their solution to my perfect chain?

[00:26:46] My chain is even too good for your indexer.

[00:26:48] And I know how to improve it.

[00:26:50] And they start improving and they are indeed for two years and spend a couple million.

[00:26:55] And then they bring a third party indexing team.

[00:26:58] And I see it happening like over and over and over again.

[00:27:04] The answer is blockchain builders are building distributed databases and indexing teams are

[00:27:10] building exactly the services that are fetching that data and giving it to the users.

[00:27:17] So these are different people.

[00:27:19] And to improve the infrastructure, you need to constantly bring new people, new builders,

[00:27:26] new teams engaging with your blockchain, building all sorts of stuff.

[00:27:32] And it's like a layer cake where the first layer is the infrastructure your blockchain runs on.

[00:27:38] So you need like hardware shops.

[00:27:43] And you better not work with AWS from Google data centers because they're damn expensive.

[00:27:48] So you need teams that are running these boutique data centers.

[00:27:54] They have assembled their own machines from like bare metal.

[00:27:59] And they put those servers next to the centralized exchanges.

[00:28:02] So your users in the future can easily arbitrage against those centralized exchanges.

[00:28:09] Then you run your blockchain.

[00:28:10] Then you build a infralabel on top.

[00:28:13] I mentioned price oracles and indexers.

[00:28:16] There's more.

[00:28:16] And then there are apps.

[00:28:18] And then on top of those apps, there are algorithms.

[00:28:20] And then there are users.

[00:28:21] And then there are social apps.

[00:28:23] And you need to constantly work with all that.

[00:28:27] And then improve it again and again.

[00:28:33] Interesting.

[00:28:35] So get rich quick using the right infrastructure.

[00:28:39] Let's say you've got a whole bunch of people who, I mean, there are some coins in the past week.

[00:28:44] You haven't gone up 5x.

[00:28:45] I'm not going to name names, you know.

[00:28:48] But and everybody goes crazy and wow that the price goes up.

[00:28:51] And say it does so fast.

[00:28:55] Like what are the dangers in that?

[00:28:58] You know, of people being rich really quickly.

[00:29:00] Like do they hold on to their money?

[00:29:02] Like how do you like how have you changed the person so that you're more patient going forward?

[00:29:07] Or is that a problem that will affect DeFi's positive growth trajectory going forward?

[00:29:16] Are we talking about the heavy burden of being enormously rich right now?

[00:29:22] Or are we talking about the risks that of centralization again?

[00:29:27] Yeah.

[00:29:28] I would say I would say both.

[00:29:32] Like, you know, having the patience, have the ability to manage wealth once you once you have it overnight.

[00:29:38] Like what are the dangers of that?

[00:29:40] And shouldn't DeFi's growth trajectory be more stable?

[00:29:45] And not so chaotic?

[00:29:47] Like what's the what's the balance there?

[00:29:50] Yeah.

[00:29:51] So the first like having having whales, having like people who got rich very quickly, it actually represents a bunch of risks.

[00:30:06] It depends on, of course, I mean, all the people are very different.

[00:30:13] So here is the thing.

[00:30:14] There was this movie recently called The Bike Riders, completely unrelated.

[00:30:21] And I watched it.

[00:30:23] And then in the end, so there was a guy who was running this motorcycle club and he got killed by a young kid that took over the motorcycle club and turned it into like a drug cartel into a business.

[00:30:39] And this old guy, he couldn't cope with that.

[00:30:43] So I think if you got rich quickly, you need to invest in different projects.

[00:30:49] I think you need to give back to the community just a little bit like a cut of your income.

[00:30:55] Just, you know, go to chat GPT and tell, OK, I have a lot of tokens of this chain.

[00:30:59] How can I improve the efficiency of these funds?

[00:31:04] One of the points will be invest across the ecosystem.

[00:31:07] Even chat GPT will tell you, you will improve the efficiency of your assets by investing into more projects.

[00:31:17] So that's, I guess, a quick answer.

[00:31:19] And then you can, again, chat GPT in the exact thread will tell you other 17 points of how you can allocate the assets among different venues.

[00:31:30] And you will see, OK, so I actually need like to expand the ecosystem.

[00:31:34] In this particular case, so it's like a chicken and egg problem.

[00:31:39] Money works, money powers an ecosystem and it needs to be like active, right?

[00:31:46] For instance, you have a lot of fuel tokens and you have an ecosystem and you better have a large ecosystem.

[00:31:55] And you expand that until the profitability for the investors across that ecosystem.

[00:32:07] Well, I don't know if there are limits for it to grow at all.

[00:32:11] Like you can trade on Spark, you can go to Swayland and you can stake those assets.

[00:32:16] You can delegate again.

[00:32:17] So you need governance.

[00:32:18] You need many things.

[00:32:21] And the successful ecosystem will, well, again, that's a chicken and egg.

[00:32:28] It will be defined by the activity of your whales, of your retail, of your community.

[00:32:34] And it will be defined by what they do with those assets as well.

[00:32:40] I guess it answers the question, right?

[00:32:43] Yeah, yeah.

[00:32:45] My concern is that as we head into 2025, I see DeFi being able to grow.

[00:32:54] But I also think there needs to be some kind of steady growth, right?

[00:32:58] So what do you see for DeFi as we head into 2025?

[00:33:02] What's in your crystal ball for this coming year?

[00:33:05] You know, what are your thoughts?

[00:33:09] OK, that's something I'm thinking a lot about.

[00:33:11] So here's the thing.

[00:33:14] Initially, we've seen the adoption of many trading firms, many institutions, many hedge funds in crypto, in DeFi especially.

[00:33:29] They started migrating from TreadFi venues to centralized exchanges.

[00:33:36] Now, projects like Hyperliquid can easily adopt those people.

[00:33:41] Now, I can still see a shift in, again, on the technical and on the user level.

[00:33:51] Thing is that the strategies those people are using, they haven't been changing.

[00:33:55] So far, DeFi has been adapting to accommodating those users and their tech, their strategies.

[00:34:04] There's a lot of things involved here.

[00:34:06] And it's been a lot, again, of capital invested into growing exactly this user base.

[00:34:14] Now, if you take the guys who started from another end, who started building their strategies on-chain, on the venues like Uniswap,

[00:34:22] or, well, for instance, today we're onboarding the majority of our users from Solana.

[00:34:27] Also move-based chains like Aptos and Sui.

[00:34:31] They have been, so SDKs that the DEXs were using since the beginning are completely different from the tech that centralized exchanges had.

[00:34:41] And you see smaller trading firms that were like Solana homegrown, or they were grown on-chain, essentially.

[00:34:54] And they start, I honestly am very proud to see how their business started to scale.

[00:35:00] Now, if you collide these two user groups, like if you put them next to each other,

[00:35:06] you can see that on-chain traders are easily disrupting the institutional layers that have been huge in this space for a while.

[00:35:16] I'm not surprised, and that's actually, it actually has a name.

[00:35:19] It's called Innovator's Dilemma.

[00:35:20] It's been invented by Clay Christensen.

[00:35:24] It has many books.

[00:35:26] And the thing is that if you take a big business like one of the centralized exchange traders,

[00:35:35] they don't see any interest in DeFi today, in on-chain trading.

[00:35:40] Why? Because these markets are not as liquid as centralized exchanges.

[00:35:44] There's just less opportunity for them there.

[00:35:49] What happens if this segment of the market grows?

[00:35:54] What happens if it scales?

[00:35:55] There's no way these institutions will be able to adapt quickly.

[00:36:00] They work nine to five, five days a week.

[00:36:02] While the kids that have been trading on-chain, it's like a culture for them.

[00:36:07] They don't call it work even.

[00:36:09] They work seven days a week, 10 hours a day.

[00:36:11] And they are easily disrupting the institutions in on-chain trading.

[00:36:15] And their tech is many times more efficient than, well, than that.

[00:36:23] And I see this shift as soon as, well, it's just, you know, as soon as DeFi markets become a little bit more liquid,

[00:36:32] this thing scales easily.

[00:36:36] I see on-chain trading firms growing way faster than they were over the last couple of years.

[00:36:43] The disruption will be happening in this model, I guess.

[00:36:48] There will be some big institutional players adapting to on-chain trading.

[00:36:53] And again, if you go to hyperliquid leaderboard, if you run the wallet analysis among the top traders there,

[00:37:00] you will quickly see that, okay, some of them actually trade on-chain.

[00:37:04] Others mostly stay on the centralized venues.

[00:37:07] Others.

[00:37:10] Interesting.

[00:37:11] I think we're headed to very interesting times.

[00:37:16] Absolutely.

[00:37:18] Awesome.

[00:37:18] So I want to thank you very much for your time today, for speaking with you.

[00:37:22] I love talking to you.

[00:37:23] I learned a lot today.

[00:37:25] I enjoyed it.

[00:37:25] And I have one last question for you.

[00:37:28] It's probably the easiest one I asked you.

[00:37:30] It's how can people find out more information about you, about Spark?

[00:37:34] How can they start to use it?

[00:37:36] How can they do that?

[00:37:40] Well, about me, you can track my Twitter.

[00:37:43] I'm having an active life there.

[00:37:45] And regarding Spark, sprk.fi is the domain name.

[00:37:51] You can go there and study more about the product.

[00:37:53] However, through my Twitter, you can also find all the information about the product I'm publishing quite a lot.

[00:37:59] Awesome.

[00:38:00] Awesome.

[00:38:00] Thank you very much for your time today.

[00:38:02] Thanks, Jamil.

[00:38:04] Enjoy your week.

[00:38:05] Cheers.