Kyle Chasse on PAID Network’s smart agreements for DeFi

0:01i'm ashton addison from event chain for investmentpitch media and crypto coin show and today on blockchain interviews we have kyle chasse the ceo of paid network kyle welcome to the show and thanks for taking the time to be here today thanks session good to be here man uh appreciate the time and looking forward to it likewise i'm really looking forward to our discussion

0:21i'd love to just kick it off with a little bit of your background on yourself how you got into bitcoin in the blockchain space and then what led you up to starting paid network sure yeah so i've been a serial entrepreneur my entire life and uh like forever since i was in middle school you know started my first business and um and uh i had a company you know my

0:43i've always kind of designed my companies based on first discovering some type of passion and interest and then studying that for a while and then kind of figuring out how i can create or monetize that and um and that's how i've done everything in the past and so before crypto i had a company called reverse aging institute it was a regenerative medicine

1:01anti-aging you know very very forward-thinking kind of progressive medical consulting and life coaching kind of practice and my clients were high net worth individuals and i built out this protocol with this billionaire the year before and doing a bunch of research and meeting the top scientists and doctors in the world and at the same time when i was building

1:24that i'm i discovered bitcoin in 2012 and by 2013 i was completely obsessed and completely understood exactly the potential it had and it's something that i had been kind of looking for for a long time you know as a us citizen uh i always was frustrated by the way that the the system worked the you know the the corruption and uh the way that the things were set up

1:50like i never voted you know and i i kind of always felt like that was a waste of time um just because uh yeah because i knew that it didn't really matter like on a grand scale didn't really matter but when i discovered bitcoin and its ability to kind of circumvent the powers that be i realized that there was tremendous amount of potential and that's where i needed to dedicate my

2:12time and my career to so i sold my company reverse aging institute and and put all the proceeds and any fiat that i had in the bitcoin in 2013 and started building uh as well at the same time so i i started building world super lotto which is the first world's first bitcoin based lottery in 2013 launched it in 2014 and that went until 2015. um you know i put all my videos up on

2:35youtube i did two live drawings a week and um you know and had all my uh the thread on bitcoin talk forum um and that's what was kind of my intro into into bitcoin and crypto and and then in in 2000 uh late 2014 started diversifying the appreciation into uh into different investments into what we called back then was just fintech but today it's all blockchain

3:01investment so um started and then went into the ethereum ico as well or not no sorry not the ico but i was in it like a dollar and then uh yeah i started diversifying depreciation from both bitcoin and ethereum into different infrastructure investments so i invested in a lot of early projects like you know kraken and coinbase and ripple circle abra bitfenix bitstamp

3:25um bitso like uh and and yeah pretty extensive list of different investments and in 2015 or sorry 16 no 15 joined a project called credits um a team out of isle of man and um and then took that into 2016 when i left for for disagreement reasons of of the project and uh and then 2016-17 i took some time

3:55out from being actively involved in the space to more just passively observing and investing a bit still but um i wasn't building anything and i also kind of thought that maybe that was the first time in my life that i could retire if i wanted to and i kind of played around with that idea but i got incredibly boring and realized if that's something i never wanted to do

4:15and then in 2017 i became very concerned about the way the space was developing you know like before 2017 everybody i met in the space was in it for disruption they were they really understood it they're really exciting like everybody there wasn't too much talk about becoming rich or anything like that it was more about you know building disruptive things and

4:33that's what i really enjoyed and then 2017 we started getting a lot of the convolution in the space and people were really kind of spreading misinformation and then all the conferences went from like t-shirts uh to suits and things like that and um and then you started hearing things like you know uh like blockchain not bitcoin or stos or icos and things like that and

4:54that really concerned me uh because i felt like it was it was intentional propaganda coming from people who felt threatened from bitcoin and disruption so uh in 2008 and and before at that time too i also was still living in the united states and i felt like because the us dollar was the thing that was threatened the most um it would maybe be dangerous for me to

5:17be very like outspoken about the the the topic so in 2018 i left the states and then decided to become more public in the space and started doing a lot of public speaking you know spoke i've done a lot of keynotes and panels and things like that and also at the same time i was heavy on the conference circuit from late 2017 all up until uh pandemic time so

5:41but early 2018 i started advising projects um and so master ventures was born which is like the parent company and uh we advised and incubated quite a bit of projects and did a lot of different things for them like token economics monetary fiscal policy marketing go to market strategy uh fundraising things like that so i have a lot of experience and my team has a lot of experience and

6:05bringing projects to market and in 2019 i felt like uh i really wanted to focus to slowly switch over to venture studio model and start building out the projects that i had in my mind and so into the 2019 was a process of of phasing out the advisory um from so so actively involved uh to more starting to create our own ideas internally and in 2020 um paid was born and this was like uh

6:35just an idea of of looking at the most disruptive or sorry the most inefficient uh systems that we still have to deal with today and then looking how to make them more efficient using a decentralized system and economy so that's kind of uh leads us up to where we are today that's great kyle and yeah that's quite the extensive history and studying bitcoin 2012 2013 and just

6:57going all in i i had that similar feeling where i just you could just see the potential and it's still in its infancy but it's grown a lot since then and just to go through uh all these years it's like it feels like decades because there's so much happening in crypto all the time even though it's only been you know really less than 10 years that most of us have been in it and that

7:19now leads you to paid network and yeah talking about inefficiencies and the industries that have the highest cost and lowest value i think the legal industry has a lot of convolution convolution in it right now and that sort of leads you to solving these problems with blockchain so if you could jump into what is the paid network's main goals the problems

7:42that you're focused on in the legal industry and how are you implementing that with blockchain yeah so we wanted to kind of shift our messaging to more you know initially it was more like really focused on on kind of uh coming after or disrupting the legal industry um but we've realized that kind of we want to more focus on the fact that we are like a business

8:04suite of technologies that really help make an entrepreneurs and enterprise and and you know small businesses more effective and being able to create different agree create agreements with people um being able to enforce those agreements or you know if there's a dispute should arise to be able to resolve that dispute in a quick and efficient way that's not

8:25expensive and um and then also being able to use defy tools in order to lock money into an agreement uh should it dispute arise and and the arbitrators can come in and look at the evidence that's uploaded and then easily be able to award whatever money is at stake to the party that deserves it or they feel like deserves it so um so basically you know the whole thing

8:49starts out with uh with looking at what the current system looks like and then how can we make it uh more efficient for today's needs you know and the very first thing that we do when we start to when we enter into business with somebody is we usually sign agreements you know these agreements are usually double digits pages long that are extremely complicated

9:08and and written by lawyers to be understood by lawyers and uh and none of us really feel comfortable in understanding the complexities and nuances of these agreements so we think that most people you know 95 percent of business agreements um were really people who just want a handshake deal to be honored you know and uh it's it's like it's simple you know you you want me to build

9:30you a website um i tell you it's gonna cost five thousand dollars uh we understand that it should be like five pages five different pages and it should be done you know in two weeks or whatever the case may be like none of this none of this discussion back and forth uh requires complex you know complicated legal language it's all very basic layman's language and you know if we met

9:56in person and we trusted each other we would just handshake on that and deliver you know and that would be that would be end of it so we're creating what we're calling like smart agreements which are like massively simplified agreements which are written in layman's terms which are meant to be understood by both parties involved and by anybody who should look at the

10:16the agreement should a dispute arise so any type of person that's looking at the should easily understand what the intention of this agreement was and you know if there's a dispute how like what or how they can make a decision based on the evidence uploaded by the counterparty so the first process is creating very standardized and simple agreements to make it very easy that are

10:37pre-populated and signed on on the app signed on chain that's the first process and then the second one is you know should a dispute arise instead of having to go and hire retain attorneys that are hundreds of dollars an hour and go dispute that in court we can do that on the platform and this is really interesting too because we all know now that when we sign these

11:00agreements there's always that that line that says you know the the laws of this of this um agreement shall be governed by the jurisdiction of cayman islands or panama or seychelles or china whatever and it's usually not where we're located and it's usually not in any type of location where if a dispute should arise we're going to actually physically fly

11:23there retain attorneys and and none of us have the time or money to go and enforce these things so if a counterparty should violate the terms of the agreement what are we going to do if that agreement's less than a million dollars it's not worth our it's not worth going after so most of us still spend a bunch of money on attorneys to create these contracts

11:41that really are useless at the end of the day you know and this this all came from my personal experience dealing with the legal system and the court system and trying to sue somebody and realizing like i've got one case that we started in 2016 that's still going today you know almost five years later um still in court having spent you know close to two hundred thousand dollars at

12:03this point and uh it's i would just not wish this on anybody and this is how the court systems work you know in india it's it's backed up a thousand years um and uh yeah it's it's just an incredibly inefficient process so uh so now we in yeah and so you take that you take that now that same process and and ex and take it across borders because we're all doing now cross-border

12:30business and it makes it even more impossible to to go after somebody if they violate the terms of the agreement and um and then even if you were to win a lawsuit yourself try to collect the funds so this process becomes a nightmare and uh and most people don't have the ability so if someone violates the terms of the agreement you can't go after them so we're making

12:50a whole ecosystem where you can have an agreement that's done quickly and simply that's borderless it's meant to be arbitrated within the paid network um and it's really going off of just kind of common sense you know like most disputes should be able to be understood in a common sense kind of way um who was right and who was wrong and in a disagreement so

13:12uh and then we have defy tools and it's i think it's really interesting that we're actually putting uh cr bringing defy tools to a real world use case whereas most d5 projects are just about you know yield and uh very very financially focused on that's what the product is so we're using d5 tools have been created to bring them to a real life uh real world use application so for

13:37example if i'm building you that website it's gonna cost ten thousand dollars um i can ask you to put the money in escrow before i begin work and if i do you know you put the money in escrow i deliver you the website you're happy with it you release the money from escrow and we're both happy and and then we can leave each other feedback too so every user in paid will have a

13:56reputation score and a profile tied to their digital identity and biometrics and i think this is really important too we don't have a system right now that exists where we can see the history of people doing business much like if you've used local bitcoins or paxful or something you can see you know the the statistics on there of a user's profile give you an idea if you feel comfortable

14:20going and meeting with that person with a bunch of cash for example in some location you know and so you can see the person's experience how much business they've done with people and you know different places um and then what the feedback was like from the counterparty on the agreement that they did so i think this is really important imagine if linkedin had

14:37uh rep a reputation scoring system where we can see you know we're about to do business someone we do due diligence and we can see you know how many deals they've done with other people in the paid network did they successfully execute them or not do they pay them or not uh these kinds of uh of use cases um and then we'll also have insurance as well you can insure your deals so

14:58one example is like i had a client that was in oil and gas i they want to do an sto i don't know how to do sto so i referred them out to a hong kong entity i had a referral agreement with them and the value of that agreement was two hundred thousand dollars and if i could have taken out an insurance policy on that deal it would have made sense for me to do

15:17that even if even though i had to pay twenty thousand dollars twenty five thousand dollars for insurance policy it would have been worth it for me and peace of mind and make sure that i'm gonna get paid on this deal because i'm handing them over a very valuable asset my client so in this example they did the sto and they didn't want to pay me in the

15:34commission that they owed me and that's 200 000 um that's actually 250 000 and so in this example um if i had an insurance policy on this deal not only would i left them bad feedback and everybody would have known that they didn't pay out on the agreement that they were supposed to but also i could have filed an insurance claim and gotten paid and that would have been

15:54much much cheaper much much cheaper than uh you know trying to go and hire attorneys and litigate the case in hong kong for example not only would have been cheaper but it would have stayed but that that just that insurance policy it would have taken me a couple hours to probably submit and it would have saved a ton of time so like this is the whole

16:13thing a paid network is to save businesses and entrepreneurs tons of time and energy and money on on agreements and dispute resolution and then using d5 tools um for to to make these things actually be able to be to for everything to be able to work and then ultimately we'll create a marketplace as well so like you know like a fiver or upwork but um you know right now if i want to

16:36bring on a cto for example um i have to go hire a head hunter or something like that you know we kind of have to rely on their due diligence and then still call out and refer referrals and things like that or a marketing company everyone knows that it's hard to find a good marketing company in crypto for example but if we had paid network in a marketplace where we could see

16:55their feedback and reputation and things like that it would make it a lot better so if people can go and look for people in the marketplace that will build they can go and do agreements with them they can do escrow or insurance things like that so we're building an entire business toolkit basically and uh and yeah we're building it on in in the polka dot well ethereum and polkadot

17:14environments we're big believers in polka dots and and uh excited for that to come come to market um you know come february when they launch your pair chains and that's kind of the the the high level of paid yeah that's great kyle and yeah i really find it interesting because in the inception of ethereum smart contracts there was there's talk about how smart

17:36contracts can automate the legal system and make it easier but now with the the growth of decentralized finance there's even more incorporated into that and also with paid network incorporating the polkadot ecosystem with crosschain into ethereum as well i think that's going to help with interoperability and just growth of the network as the whole blockchain ecosystem

17:56continues to grow into the mainstream and you know we don't have a lot of time for the interview so i want to dive into uh the ecosystem and i know that there's native currencies built into the ecosystem as well and there's also the paid token can you talk about the main functionality of the paid token within the legal system and uh how it creates a sustainable ecosystem as well

18:20sure so yeah we have a lot of experience in doing uh economic models and we feel like you know that's one of the most important things in building a decentralized network is you're building a nation basically so you have to think about things like governance and treasury sustainability what how do you continue operating expenses even after you run out of your initial funding

18:40um so we have you know done these models for people like elrond and ultra before and uh and you know we really understand how they work and so we have you know one of the most complex and thorough economic models that i've seen out of any project um but we have several different use cases for to to bring in value to the paid ecosystem you know we don't

19:00we don't value equity at paid um we don't really i don't really believe in the fact of a dual um dual model where you have equity and tokens um i believe that's like running two companies at half ass if you're going to bring value into the ecosystem you need to make sure to bring value into what the people are investing in and what people want you know what

19:18what your investors are paying for basically so um so every all the value that comes into paid will always be adding value to paid uh token holders and token ecosystem to increase you know the market cap and the size of the network so there's a lot of different use cases one of them the most basic is your subscription model so to use the the system to use these

19:39contracts and sign them and use the whole thing uh there's a monthly subscription model uh obviously you pay more for more access to more contracts and agreements um we have different staking models like the arbitrators will need to be the highest staking level much like a masternode for example and it goes off of game theory assuming that they're going to do the best of their

19:57efforts to make sound decisions based on disputes based on the fact that their the value of their the value of their stake you know is at stake so uh so basically this the yeah arbitrators have a lot of money at stake um we also have burning burning mechanisms so for example if somebody wants to pay for the subscription in fiat using a credit card we will allow that but let's say

20:21that it's fifty dollars a month um we will take that fifty dollars buy pay tokens off the open market to create buy pressure and we will uh burn 25 percent of the tokens that that we buy 25 goes back to staking rewards and 50 to treasury for operating expenses um we you know we will eventually become fully decentralized in a dow structure so we want to make sure that managing

20:42members always have uh funds to continue operations for salaries for marketing things like things like that and there's different there's uh staking rewards for um just for things like the defy tools um you know we have a open lending and borrowing market we have the insurance so you can contribute to the insurance pools in lp you can lend to for borrowing and

21:03lending for people that might need money in escrow let's let's say that i start a company or a token project that i need to hire five advisors and pay them each twenty thousand dollars flat fee and they want an escrow but i haven't raised money yet so i can borrow from the the p2p lending and borrowing market based on my reputation score will also double as a credit scoring system so if

21:22i have a good history of paying people off i can probably get a loan at a lot lower interest than if i if i don't have a history so these are all different ways that people can use paid token um in order to to participate in the ecosystem and there's more but i know that we're limited on time yeah well that's great that's that's a lot of functionality and

21:38i like what you said about you know having equity in tokens it's sort of half ass and if you're going to go all in then you want the token holders to be rewarded and to be a part of the ecosystem um so i think sorry one more thing i think is incredibly valuable too one of the interesting things about the marketplace that will create allows an opportunity for advertising to come in

21:58and i think that you know when you start talking about ad revenue um even if let's say that we had someone like linkedin or something that wanted to come do ads on our platform even if they paid in in us dollars or whatever we would still do the same thing let's say they paid 50 000 a month for ad placement uh we'd still take that 50 thousand dollars buy

22:15tokens off the open market burn 25 percent of them 25 percent staking 25 or 50 to wrap to to uh treasury and let's say that we eventually become very popular and get 500 million dollars a year in ad revenue that's 500 million dollars a year that's added to the market cap of paid network and um i think this is like incredibly valuable versus a lot of projects that

22:34you see that would take that revenue and add it to equity holders for example ours goes directly to um you know the token definitely and you're with the leading leading towards the launch of paid network there's also the paid token uh launch as well can you talk about what is the timing when is that happening and what are the details around that sure um so we are currently doing

22:59private sale um and uh public sale is we're probably gonna do it on pokestarter uh in in mid to late january and uh yeah we're we're also another really exciting thing too not related to the launch at all but um we just recently brought in uh lawrence hudson who will be our cto um who is also the he he's a cto that founded travelocity so i'm really excited about bringing

23:24hikm on board he's really excited to be part of the team uh and yeah and our private sale has really recently really taken off the past week or something we have um a lot of uh a lot of requests on our whitelist i think almost six million dollars and our raise is only 2.27 million dollars but we're looking for strategic value-add partners right now people that can help you know we've been

23:46really selective on who we bring in so far and that's what we're looking for now still is we still have some some room in our private sale um but we would like you know strategic value-add investors to come in that can really help us grow this thing definitely it's all about the added value and if those members or just community members that are looking to

24:04follow along for the launch of the public sale and the launch of paid network what's the best way uh to get involved in the community uh join our telegram um paid network and uh also twitter you can follow us on twitter we also have their medium article um so hopefully you can post all the links uh you know in this video and people can follow check out us check

24:24us out definitely yeah i'll add those links in the description box below for the viewers that's all the time that we do have for the interview but it's been a pleasure learning about paid network and it sounds like you guys have a lot on the go and i'm excited to see the launch in early 2021 and i'll follow along and let's follow up in the near future after that happens

24:43thanks ashton appreciate it man you