DoubleZero token launches at $6B FDV, building a decentralized fiber network for high-performance blockchain

your happy place. Find your happy place. Book a wander with inspiring views, hotel grade amenities, dreamy beds, top tier cleaning, and 247 concier service. It's a vacation home but better. Our last guest of the show is Austin from D0ero. He's in the reream waiting room. Let's bring him into the TVP Ultradome.

Austin, how are you doing? How's it going? Good. Thanks for having me on. Thanks for hopping on. Uh, kick us off with an introduction to you and the company and the news today. Would love to get up to speed on Double0ero. Yeah, certainly.

So0ero is a blockchain protocol building an alternative internet for high performance distributed systems and blockchain.

And so at its core, this is a physical fiber infrastructure network run by multiple independent contributors to allow systems like blockchains to go faster than the public internet uh will allow them to go. What's the status quo in the industry?

I feel like if I sign up for AWS, I'm going to get charged ingress and egress bills and they're kind of abstracting the like underlying infrastructure, the physical infrastructure. At what level are you operating? How does all of this fit together? Yeah. So, this is what's called an OSI layer 1, two, and three network.

So, this is pretty much the lowest level down in uh the networking stack. And so, this is the physical cables, the protocols that transport over them. Uh but fundamentally this is exactly what you're talking about the egress and ingress problems in cloud data centers.

That's pretty much the only thing uh that you get build for uh in a data center when you really think about it especially the cloud data centers. And so this is a way that they generate lock in.

It is easier to stay in the Amazon ecosystem because data moving within Amazon does not get charged whereas data leaving Amazon does. And this is why you have such a vendor lock in in the cloud market today.

And so if you think about the ultimate mission of uh decentralizing the entire AWS stack or the GCP stack and basically rebuilding these on decentralized rails not just for the point of decentralization but so you have greater choice from a consumer standpoint.

The network and connectivity layer really is in my view the first piece of that that we need to tackle and it's in some ways the most broken piece of it today. The internet is an incredible resource. It connects us all.

It serves data uh in far-flung regions of the world, but it was never built for high performance systems. And so, Wall Street does not use the public internet. Facebook does not really use the public internet. Even all these big internet companies that we think of, they run private networks.

And they run private networks because the internet is too slow to show you Instagram reels. And so, why are we building uh what is supposed to be the alternative replacement to traditional finance on those rails? uh how do you who are the suppliers that are bringing internet connectivity to the network?

Do you need to do deals with companies like Akami? I I don't really know who the major players are in the space that you would be pitching to bring uh resources to the system. Yeah. So today we have 11 independent uh basically fiber contributors to the network.

And this ranges from the folks you'd expect, you know, large trading firms that own and operate their own private networks for highfrequency trading purposes like DRW Cumberland and, you know, Jump to digital asset native firms like Galaxy that are uh this is a new thing for them running private fiber, but it supports a lot of the other business lines that they already do uh like market making and trading.

And then you have data centers themselves, bare metal providers like Teras switch, latitude, servers. com, cherry servers, uh getting involved on this as well as a way to basically make their regions more attractive for this new burgeoning blockchain and AI infrastructure.

Uh and then you sort of have the last category which uh are blockchain native groups themselves like JTO. Uh how does the high frequency trading uh like example work?

I remember reading was it flash boys where they build the fiber lines between Chicago and and the New York Stock Exchange so they can trade commodities faster or something.

Do those just go dark outside of market hours and then you can resell the slack capacity is that the idea or like why would a high frequency trading firm if they built this pipe and they got it and they're making money off of it like in what world do they end up with extra capacity that they want to sell back to basically a grid that you're building?

Yeah. So there's two things that are going on there. Uh, one is simply the technology changes very quickly and so if you are in the business of being a high frequency trading firm, you pay a pretty extreme premium to be on the absolute fastest path. Yep.

In blockchain, the second fastest path or the fourth fastest path is actually totally fine. These are still orders of magnitude improvement over the public internet. And so sometimes they have uh what you'd call sort of secondary inventory that they can contribute to something like double zero.

The other component of this too is there's not that many financial centers in the world. When you think about it, it's a pretty tractable problem for a large trading firm with a large budget to go out and have a team that connects all these major financial centers.

You look at just Salana, it's run in over 300 data centers around the world. Yeah. And when you include other blockchains, that number goes up dramatically. It's too big of a problem for any one organization to solve and address. And so what do we turn to?

We turn to a consortium model powered and aligned through tokens and that is what the token is the best unit at. It can bring disperate efforts together again a common goal to benefit all and it really is an innovation on the traditional corporate structure which of course in itself changed the world in its own right.

Sure. Uh tokens just happen to be the best way to create this type of alignment. Yeah. Your guys's token launched this morning sometime in the early hours. uh it's now trading at uh somewhere around a $6 billion uh fully diluted valuation.

Uh what goes into like what what's like the what's the process to get to get to this point from a uh more from like a financial standpoint? Obviously, you need traction with the network and usage and a bunch of different partners, but uh we talk to a lot of, you know, more traditional public company CEOs.

will often talk to them on their IPO day and we'll talk about the different processes around the road shows. But on the digital asset side, launching a network like this, what are kind of the key steps leading up to this moment? And congratulations by the way. Thank you. Yes.

Uh one of the things that is different about a blockchain protocol than you know any sort of traditional structure is we don't own and operate any of the fiber. And now you can say sure Uber does not own and operate any of the cars.

Um but at the end of the day the role of the core contributors to the double0ero protocol is to build the software layer with other core contributors that then allow this contribution of fiber units to it.

And so a ton of the work in the early days on this project, apart from the software side of how do we actually build these things in decentralized fashions that allow for permissionless contribution of fiber, but how do we go out and convince these people who have access to fiber that they should take a quite valuable asset that has fairly high opex and fairly high capex and contribute that to the zero network.

And a lot of that comes back to uh you know our contributors for the most part are fundamental believers in the power of this technology.

We don't have today like an AT&T or a Verizon or a Lumen contributing capacity to the network because those are largely either publicly traded companies or companies that are owned by PE firms and they're expecting a very traditional uh dependable type of return from that. Crypto is not that.

Uh this is this is very much the wild west. Uh the hope of course is that over time we you know uh basically prove that it's worth contributing even a small slice of a global fiber network owned by one of these subc cable firms or you know these traditional telos into the mix.

And we've had a number of outreaches just today uh from more traditional players asking how they can get involved. Uh the real thing here is all of these companies, it's the same thing that the cable companies were going through in the United States maybe 10 or 15 years ago.

They're they're priced and they're valued and they sell effectively dumb pipes. And I don't mean that in a derogatory way. They're quite sophisticated advanced technologies, but they don't have the same ability to take a cut of what flows over them the way you see in other types of spaces, especially in software.

And so the promise of going from selling something for a fixed dollar amount to a token model where uh validators operating on it and traders operating on it pay a percentage of their earnings into the network is a potentially disruptive business model opportunity for these traditional players.

The same way that the cloud providers, yes, there was a technology revolution there, but it was as much a business revolution as anything else. How has the new admin uh been helpful to you guys even just in terms of being generally pro- crypto?

I I don't know how long you've been uh building the the foundation in the network, but I imagine you know this wouldn't have been the kind of thing you wanted to launch two three years ago for a number of reasons. Yeah, I mean I got involved in crypto in late 2017, early 2018. Uh worked for a company called Republic.

uh worked for a company called Bison Trails which then got acquired by Coinbase and spent the previous four years working for the Salana Foundation. So I've been through uh the changing regulatory landscape.

You know, we received a no action letter from the SEC for key components of the flow of tokens in the zero network. This is really important. Shout out [ __ ] That was your law firm, right? Shout out [ __ ] Let's go. We love lawyers here. They don't get you go. Uh I owe them a drink.

Um yes, I I I will say that the uh you know the whole thing that came together here was you know going to the SEC and asking for relief. So this is a process where you can basically go to them and say we would like to do this. What do you think of this? Do you see any problems with this under current securities law?

And so we applied for relief on two specific areas. The first area was around the reward distributions to contributors. So basically the network programmatically paying out tokens proportional to the uh the utility that a contributor brings to the network. This is not like proof of stake.

This is much more similar to proof of work where if you generate 10% of the hash power for Bitcoin, you get 10% of the rewards.

But this is really important to us because many of our potential contributors, especially as we sort of move lower down and closer to the direct fiber owners, they are not sophisticated crypto lawyers.

They may not even be sophisticated securities lawyers and and that sort of reassurance that we can get from the SEC of hey this programmatic payment based on this type of model uh they don't see any issue with that from a security standpoint. Yeah, makes a ton of sense. Um absolutely massive day.

Hope you uh I it's uh unlike you know uh public company CEOs, you know the the market closes then you get a little breather. not you're not so fortunate but um massive massive milestone and uh as you start knocking down some of these massive partnerships uh come back on and tell us about it.

Thanks so much for hopping on the show. We'll talk to you soon. Cheers. Appreciate it. He said that the internet is not a series of tubes. Are you familiar with the famous line that was said in Congress? I believe the internet is a series of tubes. There's a music video. This is a video huge sign of respect.

They turned it into a meme. It's from 2006. It's one of the one of the great sign of, you know, respect in my culture to show you a YouTube video that you might not have seen. I want to show you this video from Internet Explorer 4. 0. The internet being a series of tubes. Let's play this.

The internet is not The internet is not a big truck. The internet is not something that you just dump something on. The internet is not This is huge in 2006. The internet of the internet. This is a real clip from real sound. We can cut it.

Uh this is a real clip from a testimony that happened in Washington DC with a lawmaker who's trying to explain the internet to the like to Congress basically was saying it's not a truck. It's not something you just dump something on. It's not fixed. It's a it's it's a flow of tubes.

And he was lambasted and made fun of for this, but it's kind of true. It's like it is the flow rate matters more than the fixed quantity, you know. It's not it's not a it's not a data center. It's a it's a series of tubes. It's a series of tubes. Anyway, how'd you sleep last night? Uh, brutally.

It's just been such a it's honestly been a brutal week of sleep. I got an 85. Got a 65. Oh, give me the sound. Give me the sound. Let's go. Yes. There you go. Boom. Yeah, they have this new feature that tracks your sleep debt. Oh, I saw this. The sleep debt is really really negging me these days.

Like I've accumulated two and a half. Okay, I'm at zero. I'm at perfect sleep balance. Not in debt. No surplus, no debt. I'm doing good. It's great because I have this handicap of having a much longer drive in to work. And so it kind of I really got to push myself, you know, equalizes for the twins earlier.

Yeah, it it equalizes for the twins. Yeah. Um it was great to see we saw Will Robbins in the chat earlier. He was thank uh pumping up dual entry.

We had dual entry and then double zero back to back a little bit confusing but uh apparently Will did uh the seed of dual entry so he's feeling pretty good with this announcement. Uh in other news in uh inversion space announced ark the world's first space-based delivery vehicle. This uh video looks remarkable.

ARC enables the ondemand delivery of cargo and effects to anywhere in on Earth in under an hour and offers unparalleled hypersonic testing. Sounds very sci-fi. Uh they have a rendered video here. Uh we'll have to dig in and understand the actual timeline for this.

It seems like a very ambitious project, but congrats to everyone over there at Inversion Space. Very cool. And uh we got to get on with London. We do. Tomorrow, unfortunately, we will not have a stream. Uh, we encourage you to touch grass, watch our recap of the week. Maybe we'll release the recap early.

No show tomorrow. Watch the first episode we ever dropped. There's a lot of lore in there. Lot of lore. Enjoy that. A lot of fun. We will be off tomorrow. We will be back Monday full force. I cannot wait. And uh we hope you all have a fantastic weekend, but don't start until tomorrow.

Maybe around five, maybe around 10, maybe burn the midnight oil. But have a great weekend. We love you. We'll see you Monday. See you later. Bye.