Fintech 3.0: Now Is The Best Time To Build In Crypto

**Jesse Pollak** (0:00)
We've entered the golden age of crypto building, where we finally have the tools, and now it's about entrepreneurs coming in and saying, how do we use these tools to make 10x impact for businesses, or to build new consumer experiences that were previously completely impossible? And the moment is now to break through, because we've done the infrastructure work. The tools are in place, the stable coin is the chain, and now it's about putting it together into that magical experience that grows like wildfire across the world.

**Harj Taggar** (0:34)
I'm really excited to be joined here today by Jesse Pollak. Jesse is the founder of Base, which started life as Coinbase's blockchain, but has since expanded into essentially the everything app for crypto, right? You can use Base to trade crypto, store your own crypto, and build community with other people in crypto. Thanks so much for being here, Jesse.

**Jesse Pollak** (0:52)
Thanks for having me.

**Harj Taggar** (0:52)
The reason Jesse's here is that Y Combinator and Coinbase are together putting out a joint request for startups building in crypto. We both believe that there's never been a more exciting time than right now to build in the crypto world. And we're going to talk about some of the reasons we feel that way. And what are some of the specific ideas and areas that we think founders should be paying particular attention to as they go out and build really awesome crypto products and services. Okay, Jesse, in our Request for Startups blog post, we mentioned this progression from this idea of FinTech 1 through to FinTech 3.0. Maybe you could talk us through how you think about that.

**Jesse Pollak** (1:25)
So I think about FinTech 1 as the 90s, things like PayPal, where consumers for the first time got comfortable paying for things online. I think about FinTech 2 as this wave of the last decade of start-ups that built on top of the existing legacy financial system to deliver friendlier consumer experiences with money. Now, I think about FinTech 3 as the opportunity to rewrite it all, to basically start from the ground up and say, how do we make the financial system work better for everyone by building it on top of the programmable software platform that includes money and is crypto?

**Harj Taggar** (1:57)
Okay, Jesse, so AI had its sort of magic moment with the ChatGBT launch. Do you feel like crypto is maybe going through its own ChatGBT moment right now?

**Jesse Pollak** (2:05)
Handedly, no. And I think the reason I say no is because if you ask a friend or family member, I don't think they'd say, oh yeah, I have had a magic moment with crypto. I think instead they might be fearful. They might not actually know what crypto is doing on a day-to-day basis. And so the thing that's powerful about that is that that's the best time for us to be building and the best time for YC entrepreneurs to be trying to break through. And the moment is now to break through because we've done the infrastructure work. The tools are in place, the stable coin is a chain. And now it's about putting it together into that magical experience that grows like wildfire across the world.

**Harj Taggar** (2:40)
What exactly has changed? What exactly has developed that makes it feasible to build this technology today that wasn't possible even like five or six years ago?

**Jesse Pollak** (2:49)
Yeah. So when we're thinking about building crypto apps, we're building on top of a stack. And that stack has a few different components, but the ones that I think have really progressed in the last few years are a few. So the first is chains have really matured. And you can kind of think about the chain as the programming environment where you're building all of these applications. So to AWS, the chain is kind of the next generation of that, where you can imagine you write code, it runs on this globally distributed computer, anyone can access it and participate in it, and that's the substrate where you can build. And the problem that we had with the chains five years ago was you could do that, but it was slow and expensive. And so when you were trying to build an application and you wanted to maybe send a stable coin or you wanted to enable someone to create something, you'd have them try and send $5 and it would cost $5. It's like that doesn't work for building a consumer application. And the thing that has shifted over the last few years is that those costs have come massively down. And whether that's with Base or Solana, we actually have this scaling that's happening where now you can build those applications and instead of it costing $5 to do something, it costs 5 tenths of a cent or 500ths of a cent. And that opens up the aperture of what's possible.