Inside Solana's Plan to Replace Wall Street | Anatoly Yakovenko

**Turner Novak** (0:02)
Totally welcome to the show.

**Anatoly Yakovenko** (0:04)
Thanks for having me.

**Turner Novak** (0:06)
Thanks for doing this. Really excited to have you on. So something super interesting that I saw was happening recently. SpaceX, before it went public, people were trading SpaceX on Solana.
What was going on there? What does that even mean? How do you do that?

**Anatoly Yakovenko** (0:21)
There's a lot to unpack there.
Basically, I think we have to understand first is what are tokens, and anything can be a token. It is literally just an entry in a database, and Solana is a blockchain. The only thing that it does is really make sure that everyone has the same copy of a database instance. It's exactly as dumb as it sounds.

**Turner Novak** (0:52)
The simplest definition, a public database.

**Anatoly Yakovenko** (0:55)
And it can't really make sure that that's true. It can only give you, you as a user of this public database, it can give you a guarantee that enough other people agree that you have the exact same copy as them. You basically constantly submit attestations that you have the same data, and you can see that okay, two-thirds of the people all agree that we all have the same copy as I do right now, so I'm still synchronized. That's all it does.
It's as dumb as email.
So when people say they're going to trade SpaceX, somebody has to create an entry in this database, and the database itself is not aware that this is a SpaceX stocks or anything. It's just, here's some entry, and it's got a jumble string that's a public key that doesn't mean anything to the database or to people. It looks like just a bunch of ones and zeros. And then they say, this represents SpaceX. Literally somebody has to say, I'm a company or an issuer of this token. And when you trade it, you will have some kind of claim that is related to the real SpaceX stock. And then some kind of claim is where we got a hundred years of securities law and a whole bunch of other things that are very complicated to unpack. And I think it could be a cash claim on the opening price or a whole bunch of ways that you can derive that claim. But the best final version of this, a true version, is if it's actually a claim on a real stock ownership that connects back to the cap table that the company and the government recognizes as belonging to the SpaceX corporation.

**Turner Novak** (2:49)
So this may be a dumb question, but some people still might be thinking this. Why don't you just buy the SpaceX shares directly? Like what's the benefit of you can buy it on Solana instead?

**Anatoly Yakovenko** (3:00)
To again, this kind of goes back to more than 100 years ago to the railroad boom.
Why are things the way they are? Basically, a lot of the US financial system was developed pre-internet, really pre-World War II, and it's quite excellent. And the reason why it's really good is because it failed a lot over 100 years ago during this massive railroad boom. And when people think of the AI boom today as huge, I think the railroad boom was twice as big relative to the GDP.

**Turner Novak** (3:34)
I've seen data around that, yeah.

**Anatoly Yakovenko** (3:35)
Yeah. The amount of just capital and money and steel and everything and the economy that went into it was astronomical. And at the tail end of it, first of all, a lot of railroads got built, massive amounts.
And at the tail end of it, a bunch of bad stuff happened. And that bad stuff was that like, your neighbor could sell you a stock certificate to some railroad company. You don't know if that's a valid stock certificate. You don't know if the railroad company is valid, if they're actually building anything, and if the railroad itself is profitable. All these things have a layer of indirection for you to actually go verify to be certain that what you're paying for is a real thing. So, the US financial system and the really smart regulators at the time basically created separated, regulated entities that could operate in one layer at a time. And they had to go get certified and yada yada with the government and get licensed effectively. And because of how narrow each one of these slots was, the government could assess their ability to do a good job in that narrow slot.
And that interface between all these layers and the fact that there are different people operating and all of them created this safety where if one of them catches a bug, it doesn't propagate to the final person that is the retail user that's buying a stock certificate from their neighbor.