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March 11, 2022

Mission: DeFi EP 47 - Tempus' David Garai - Fixed Income & Yield Speculation go DeFi!


As we all work to move DeFi into the real world, there is also an opportunity to bring institutional products into DeFi and give us and institutions new opportunities. The team at Tempus is doing just that with their fixed income/yield speculation protocol. They've taken a unique approach to the concept and have seen great growth. David and I discussed what is has been like building this platform, the complexities of making it work and the work they do to train users on how it works. As a bear market engulfs us, I think Tempus is nicely positioned for growth as investors seek more conservative options to ride out the storm. 

Project Name: Tempus Finance

Project URL: https://tempus.finance

Project Twitter: https://twitter.com/TempusFinance

Guest Name: David Garai

This is not financial advice. Nothing said on the show should be considered financial advice. This is just the opinions of Brad Nickel and his guests. None of us are financial advisors. Trading, participating, yield farming, liquidity pools, and all of DeFi and crypto is high risk and dangerous. If you decide to participate, do your own research. Never count on the research of others. We don't know what we are talking about and you can lose all your money. Never invest more than you can afford to lose, because you probably will lose it all.

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Transcript

if you think about what's the relationship between principle and yield in the real life you can see that there's the ratio at which these two tokens trade against each other which it implies what the market thinks is the yield right so in one pool we have five principle tokens that we have 100 year tokens and it's a one year pool then that means that the market thinks the api for that pool should be five percent and based on that people can take speculative bets oh the current rate is five percent the market thinks that so i'm just going to fix my yield there and then you what happens there is that there's a swap between yield and principle tokens and then the rate drops so it goes down from 5 to 4.9 and if somebody else comes in on the other side they say oh i think the yield is too low i'd rather get a leveraged exposure to the yield i'm gonna buy more yield tokens and the yield goes back up to five percent the market always balances itself out until it settles at the rate that the market thinks is the most appropriate one

welcome to mission d5 with brad nicholl where we explore projects in decentralized finance that are innovating and driving our mission a financial freedom forward thank you for listening if you like what you hear please subscribe rate and review mission defy and spread the word by posting a tweet to the show all opinions expressed by brad nicolaur's guests are their opinions and do not reflect the opinions of black knocks material indicators or any other affiliated organizations you should not treat any opinion expressed by brad nicholler as guests as an inducement to make a particular investment follow a particular strategy or become involved with any project a project being featured on the show is not an endorsement of that project in any way this podcast is for informational purposes only now here's mission defy with brad nicholl

hey folks thanks for tuning in to the podcast excited to have you listening to mission defy wanted to quickly give you a note that this episode was recorded prior to the andre krogne mess and obviously our discussion of that was prior to everything that occurred in addition tempest is already available on phantom so go check them out it's a really great project really solid team i'm really impressed with david and his leadership and i appreciate him coming on if you like what we're doing and you enjoy these episodes please take just a moment to go to apple podcasts rate and review us it helps us grow our audience and keeps us rolling and helps us spread defy so thank you very much thanks for listening have a great day i'm excited to have on the show david garai from tempest and i'm excited because it's a part of the defy landscape that i think a lot of people don't necessarily have familiarity with in traditional finance or in d5 itself and it's growing rapidly and i think it presents a lot of opportunities for investors and of course we like anything that kind of grows the deep space and the usability of what we can do so david welcome on board thanks for joining us if you could let's get started if you could tell us a little bit of your background and how you got into crypto and why you're creating tempest sounds good thanks brad good to be here yeah maybe i can just jump right into it my background is illegal so i come from a legal background i went to law school in the uk i finished that wow and all the usual stuff and then after that i went to work at a big law firm in london i did mostly derivatives and structured finance work working for the big banks and the big hedge funds and the big investment banks helping them structure all of their interesting exotic derivatives deals mostly equity derivatives interest rate derivatives all that kind of stuff so a lot of late nights uh crunching over is this nice which is what it was uh and then um after that i moved to tokyo worked there different law firm for three more years and then after that i said okay it's enough for that which i think a lot of lawyers come to that conclusion uh sooner or later and so that's why i left i joined another blockchain startup called interlay i worked there for a couple of months as a head of head of operations i still i'm still involved with the project by the way but at that time i thought it was time to leave called quits because i my co-founder and i had this idea to build a product in the space that i had been working in in my previous life as a lawyer which was interest rate derivatives and working in that field working in the big law firm and doing these uh billion dollar deals made me realize that it's such a huge area of finance that is not really developed in d5 at the moment and i realized also that when institutions start entering the space there will be a lot of demand for fixed income products and interest rate swaps and so we try to come up with an idea that's somewhat similar to interest rate swaps but do it in a more defined native way okay awesome and was your involvement in d5 just something that you stumbled upon or really what drove you what was there a mission for you or was it an opportunity and there's nothing wrong with either answers no i think it was in between i think i i mined bitcoin back in 2013 like a long time ago and then but i think i gave up because it uh killed my laptop's cpu it didn't even i didn't even try mining with the gpu as ever the cpu was like a disaster but back in the day oh no my laptop's on fire let's stop but yeah funny story actually like i just discovered on slushpool that i could i still had access to the slushpool account and i tried and i looked at it like a few literally a few days ago and it had a balance of 50 in it which is not too bad for considering that i use my laptop for 30 minutes before it went on fire so that's pretty good that's that was pretty successful yeah pretty successful yeah that's awesome yeah but but i think for us it was in between so i had an involvement with crypto from an early age i was always super enthusiastic about it i wasn't really too sure about where it's going to go until i started working in the field but when you start working in crypto i think like most people would agree that once people stop once you start working in crypto you never go back to your traditional job and i realize like how much uh how much funding there is buzz about it and the whole idea about like decentralization decentralized applications was something that was very exciting for me and then i tried to take that you know excitement and then couple that together with my previous background as a lawyer and my knowledge of like interest rate derivatives and try to combine the two and that's how we started yeah as an attorney you had you really had insights into the inner workings of things what people were thinking about when they were building these things in traditional finance what the motivations of the players in in the space were probably gave you a ton of insights into being able to apply it to building a product that makes a ton yeah that's true but although we one thing that i have i can say is that in traditional finance i negotiated these high otc very custom deals for between banks and companies and these deals had there's a lawyer on each side there's a lot of back and forth terms are you know heavily negotiated and once you sign it's a completely non-collateralized deal party is like you get the counterparty risk of the other party and then it's a long trade so you enter into an interest rate swap for the next i don't know up to 10 years wow but the d fighter doesn't work right because non-collateralization doesn't work because you don't know who your counterparty is and if you go with a similar model they just run away with your money we had to come up with a way that first of all gets rid of this problem this like heavy customization because that doesn't work in the context of d5 people don't have time to negotiate stuff for a long period of time and they don't trust the counterparty so how do you come up how do you solve these two issues what was the key problem for us and what we came up with was tempest it's kind of like a future your tokenization protocol and i'll go into the nuances a bit later but we tried to negate all these issues by basically redesigning of how interest rate derivatives should work let's let's step back to what the model is for how it exists in traditional finance and then what you guys morphed it into and what you were trying to the advantage of the possibilities that you were trying to give to people that you learned from traditional finance what is interest rate swaps how does that work and who are the people is this all big banks there's no joe on the street trading interest rate swaps or it trickles down you when if you have a mortgage that's a fixed rate mortgage there's a swap in there there's a swap involved and there's a variable payment and the bank pays gets from the lenders and then they there's a swap involved with there but they take your cash flows and then swap it with someone else so they fix their in and outgoing payments so most people who have a loan it's a fixed rate loan there's a chance that there's a swap involved you just don't know about it because the bank does it on your behalf but the rate that you get as a fixed rate the fixed rate mortgages are always higher than variable rate mortgages right the reason for that is they that says additional risk involved so they have to pay more for that and there's the the way that's structured is there's a swap let's say you're a company you're borrowing a lot of money you have to pay monthly interest payments that is that's structured as let's say the current rate the current fed rate interest rates right now central bank whatever central bank base rates plus x percent right plus two percent let's say okay if you're a company that's risky because in 10 years time you don't know what the base rate is going to be you don't know what the fed's going to do in two years in two months time let alone what it's going to do in five years time so in order to account for your own cash flows you enter into a swap uh that fixes these outgoing payments you know exactly in each month how much you're going to have to pay so that gives you certainty over your own finances you're not going to be out of the money if something goes wrong and maybe you have to pay a little bit more in the beginning but over time you're confident that this is a good hedge which is what it is right yeah so this is how it works in traditional finance normally there's a very long heavily negotiated document between a bank and the company that wants to do this and you have to there's all sorts of covenants in there a lot of different terms that people have to be comfortable with and there is normally some collateral but not not fully collateralized like what we would want to see or over collateralize we would want to see in d5 so there's an element of trust in there but you have to collateralize it a little bit this model doesn't work in d5 right it's difficult to pull that off because uh there's no negotiation counterparties it doesn't work so yeah it doesn't translate okay yeah yeah and so you guys were endeavoring to give something similar to that where it's a stable income based product but wrap it up into defy so that it was trustless and people could actually take part in these kinds of markets but in a different way so what did you guys do to approach the problem and how did you address that yeah like maybe i can start with explaining like uh interest bearing tokens and yield bank tokens at d5 so let's say you're landing on you're lending your money on compound or you're staking your money on sticking uh if on lido for example you always get something in return so there's a token that represents that your funds being lent out on compound these would be c tokens on average they would be a tokens one urine would be y tokens then on lido if it's just it's called state and then these tokens appreciate in value and technically it's an interesting i think it's interesting discussion that these tokens technically appreciate in value in perpetuity forever so there's no maturity date on it so if you think about them they're like a perpetual bond in traditional finance only that doesn't really exist because no company will say i will keep paying you interest forever on this loan right like that would be there there are some companies that still have that but they're like leftover stuff from the early 1900s and stuff that they couldn't get rid of and then they still keep paying interest on that but aside from that that kind of product doesn't exist so the first issue that we face is like how do we turn this perpetual interest paying token into something that can be valued so how do we value the interest payments on something that is supposed to earn interest forever it's an impossible thing to do so what we need to do first is we need to take these c tokens a tokens other interest brand tokens and then we have to lock them into a contract with the maturity date uh they can be unlocked after but we have to give it a maturity date so that we can value how much interest will accrue between two dates because otherwise you can't make a calculation if uh continues into eternity so i've staked my token somewhere i know i'm going to earn x percent on some kind of stable level i lock my tokens my tokens would be locked up for a specific period of time so that you guys can calculate the overall value of those over that particular period of time okay great yeah cool so what we do is so we take it take a c token for example let's just stick to that as an example everybody knows compound right and so you you we take a c token we lock it into a contract with a mature date and then what we do is we basically split the c token into two separate tokens once we lock the c token into this contract with the maturity date it turned it from a perpetual bond into a bond that that only accrues interest until a certain period of time so it's like now we turn this perpetual thing into an actual bond it's like a zero coupon bond like similar to that and then once we once that's done we basically split it out into two different tokens the first token is called the principal token and that means that basically just the claim to the principal position so the amount of money that you put in at the start so let's say you put in a hundred dollars just in this example you put in 100 c tokens for example and then you are you will receive 100 principal tokens which will be redeemable for 100 c tokens to get those so that's one token that we do and then we also tokenize the yield that accrues on these 100 c token as a separate token so it's like a separate thing and this is where the interesting stuff comes in is that you can trade these two newly created tokens the principal token and the yield token against each other through an amm and which and this is this allows for a bunch of different use cases for example so let's say you you want to get a fixed yield so what do you do you're you have exposure to c tokens let's say you already have a bunch of them in your wallet or you're landing on compounds and then you want to you say oh i think rates will go drop from here i think i can't take this i just want to make sure that i lock in this current rate and let's see what tempest offers and then i'll just want to get this for the next six months and no matter what bear market happens i'm still going to get that so what do you do so how does it work under the hood because on tempest you can just get put in these c tokens and just get the principal tokens in one swap right so you swap these c tokens into principle tokens which know how much they're going to be worth on maturity but under the hood what's happening is we have the c tokens we we'd have let's say put in 100 c tokens we separate that into principle tokens and your tokens and then we make a swap between and we swap all of your future your tokens for more principal tokens so you end up you end up depositing 100 c tokens but you end up with 105 basically locked c tokens that is redeemable at a future time and the interesting thing about this model is that there's no stable coin is involved right like you can look at similar protocols that are working in the space and they have two separate amms they have a usd slash principle pool and they have a yield token uh stable coin pool just two separate pools right you don't do that we just have one pool principal token slash your token it's very easy for people to get a fixed yield and you can do that in just one swap so it's you can get certainty very easily so basically you're just locking in what your future value should be at the current rates at the end of the day what's the motivation on your side of the equation and offering this right what's the end value to other players within your protocol and what happens at that point you're not just giving people free money no no no it's a it's a risk reallocation mechanism between different market participants because you can think of so maybe i can explain a little more about this principle yield pool because that's the interesting stuff right if you think about what's the relationship between principle and yield in the real life you can see that there's the ratio at which these two tokens trade against each other it implies what the market thinks is the yield right so in one pool we have five principal tokens and we have 100 eur tokens and it's a one year pool and that means that the market thinks the api for that pool should be five percent and based on that people can take speculative bets oh the current rate is five percent the market thinks that so i'm just gonna fix my yield there and then you what happens there is that there's a swap between yield and principle tokens and then the rate drops so it goes down from five percent to four point nine percent and then somebody else comes in on the other side they say oh i think the yield is too low i'd rather get a leveraged exposure to the yield i'm gonna buy more yield tokens and the yield goes back up to five percent the market always balances itself out until it settles at the rate that the market thinks is the most appropriate one awesome okay that's a nice simplified explanation i think most people who aren't familiar with this that'll help a lot and so essentially you're allowing people to hedge against their current value and potential downturns in the market and other people to speculate on future value and also we provide like a very unique value proposition for liquidity providers because as a liquidity provider what you provide liquidity with is your yield bearing token so for example c tokens in this context let's say you're landing on compound and you're getting like let's say five percent good case scenario getting five percent on your usdc and you think well i'm not using this position for anything else maybe i want to get some extra yield on top of it and then what you can do is you can deposit it into tempus and you can get some additional yield on top of the currently existing compound yields the way that works is that you provide the c token and then we split it out into principle and your tokens let me use those principles and your tokens to provide liquidity to the amm right so when people are making these swaps and there's like a one percent swap fee or whatever swap fee set up in that pool as a liquidity provider you get a percentage of that so you get you benefit from the underlying trading activity in the pool and then basically the two yields are aggregated into one high yield so as an as a lp you get the compound five percent plus let's say the tempest api is five percent on top of that so you can boost your compound yield by an additional five percent by doing this basically yeah awesome why is it that you think that other folks in this arena have separate amms for each whereas you all how did you guys come up with saying okay let's just put this all together what was the thought process behind that i think the first thing is it's a lot more capital efficient because as a liquidity provider let's say on a dollar to dollar basis the yield and tempest is always going to be higher because in this design you maintain exposure to the entire underlying yield because liquidity is provided as principle slash yield right so you get the entire compound yield another pool in other designs if you want to have if you want to be a liquidity provider on both sides you have to match the principal token with the backing token so with the let's say a stable coin right then you have to match the amount of yield tokens with the stable coin as well so if you provide 1 thousand dollars worth of worth of liquidity in the split design that means that there's half of that in stable coins right yield is always lower right because you cut the underlying yield in half so as an lp because of the capital efficiency in tempo it's obvious that the yields are higher so it makes more sense for people to provide liquidity also it didn't really what i have seen and a lot of different designs is that the yield side itself doesn't really get used that much so people just use the yield tokens to exit and there's not that much trading activity there so putting the two together it forces people to to have more liquidity on the yield token side and then they use that as well which is the case so we've seen some good trading activity in our pools when did you guys start building this i think it was april april yeah all right and how's it going so far how's the uptick good maybe i can tell you a bit about the team so yeah yeah it was only the two of us my co-founder george and i georgia he worked at the ethereum foundation when we met in the solidity team and then we uh raised like a small like two million dollar seed rounds ended up hiring like i think uh six people back then it was a team of seven people then we raised another round it's another strategic round we went to mainnet then we did they did an lbp raised another 27 million and then now the team is pretty well funded and we're just going up to 20 people next month so wow uh it's been a crazy like eight months or so it's uh crazy to think about that we're not even a one-year-old protocol but you're already on mainnet we just released like basically an mvp using lido state eve right that's done you know relatively well and then now because yields have dropped quite a bit across especially across the ethereum ecosystem with the impending bear market or we'll see how it goes but doesn't look great we're looking at other chains as well because yields are a bit higher and let's be honest like getting three percent uh fixed yield on your die or getting a three percent variable rate on your diet doesn't really make too much difference especially since most people are down like minus fifty percent so uh three percent fixed yield is not that attractive right now yeah so we're looking at other chains in fact we just announced that we're going to be deploying on phantom where the yields are you know much higher like it's i would say it's 15 20 on uh stable coins which is which is very attractive to users and then if you can fix that if you could fix that back in the day when compound had 20 percent i think a lot of people would have gone with that right so the value proposition that we offer is that body field deals draw from here you can hedge against that and lock in the current rate for the next year and then guarantee to get that 15 20 on your stable coins that's great what what's the minimum lock-in periods on these so there's no lock it's interesting i'm sorry not the maturity oh yeah i think that just depends on the market what we're trying to do is just get people's interests about have some ideas about what they want we've tried three-month pools six-month pools maybe we'll even try one-year pools for these ones i think it's mixed because it's a new protocol people want to try it out first they want to just experiment with it a little bit so shorter pools make sense for that reason but longer pools offer i think that's a little more exciting because the longer the pool the more uncertainty there is and the more volatility there is so i expected in the long run we'll try to move towards longer mature but the interesting thing is i'm sure the dates don't really matter that much because you can early redeem and you can exit your position at any time so you can do that maybe you'll be a little bit out of the money if the rates have changed against your favor but your funds are never locked so even if you exit into a long pool and then you end up yield farming and that in six months passes and you're in a one-year pool you can still exit and you might get a profit it's not it's not another big deal as you grow is is part of the the growth strategy for you to partner with other protocols in the space to get them to promote people towards you and are there integrations you can do with some other places where people are getting yields so that yeah it becomes something very simple and easy for them to participate with you guys i think that's a good thing about like tempest in general is that we we can integrate with any source of yield and then that basically means that the opportunities are endless in what protocols we can integrate with and it's part of our growth strategy to try to integrate with as many product protocols as we can there are some limiting factors so we need to have a significant tdl in a single pool for us to be worth integrating with because if they don't have sufficient liquidity then what's the point in building a secondary market on it it sure only has 10 million dollars like at that point we probably have to wait and see and then once it gets to the higher seven figures eight figures then it's easier for us to be convinced that there is actually demand for our product but that being said i think now this d5 tbl has grown by a lot it's uh easy for us to find integration partners and there are the good thing is we support any sort any form of yield farming whether that's staking whether that's liquidity provision lending there's all sorts of different things so we can integrate with basically anything it doesn't really matter to us as long as it offers like a high-ish yield and with some volatility is this something where um the protocols you're working with they need some level of composability so you guys can track what the current yields are on that protocol yeah that's right and also i think luckily there are most of these yield bearing tokens tend to follow some tend to have some consistency once you do integrate with c tokens or a tokens a lot of other models have inherited that so there isn't that much difference and i think there are some proposals being made on ethereum right now to to make them standardize as well which would make integrations really easy sure um so we'll see how that goes how how do you guys besides tvl slash volume are there other things you have to consider because of the nature of what you do for a stability of a protocol team do you guys have to like do due diligence on on the projects that you're thinking about offering in tempest yeah yeah we do and actually we spend a lot of time doing that now we have two people in our research team whose jobs are setting the most appropriate rates setting the most applications amm parameters maturity dates all this kind of stuff and part of their part of their job is to also find out as much as they can about all these protocols that we try to integrate with and make sure they're audited they have good usage good community no history of exploitation and all this kind of stuff because ultimate has tempest although we make it clear that you get an exposure to the smart contract risk of the underlying protocol obviously we don't want to expose our users to all sorts of hacks and everything else that being said we're working on protocol level insurance for tempus so that we insure all the funds automatically when somebody's depositing so you don't have to worry too much about that which by the way also covers the underlying protocol at the same time so if something goes wrong on that side then you know you get your funds back which is great and then we have bug bounties and several audits as well we take security pretty seriously that's cool has it been in terms of building community around this has is it a little more difficult because it's something that average investors haven't dabbled in in the real world than time educating and not just that we're in a weird position in the name but actually trying to find out what's the best way to market the product as well because if you look at the normal retail user they they don't really care too much about fixed yields what they care about is getting 10 000 api right and then and they don't want to get they don't want to hear about all these fixed yields and it doesn't really matter to them because it's all in you know the risk on sure and it's not really their kind of thing to dabble into this boomer area of crypto so we have to so we're coming up with a bunch of different products right now that will cater to all these users as well by the way for example right now you can very easily get a fixed yield it's like a single transaction and a lot of people potentially want that in volatile pools but at the same time what we're releasing and what we're working on is for people to take the other side of the trade and bundle that as a vault product we would have a 2x leverage or 3x leverage vault at the same time that uses the same back end but what's happening there in reality is that instead of swapping your yield tokens for principles and holding only principles we make a swap so you end up with twice the amount of yields as principles and that automatically creates a 2x leverage for the user so that you're if you want to take a little more risk and you don't mind having having a small chance of losing your part of your principle and you can just deposit into these vaults and then you into for any urine pool for example or for compound or anything else and then if rates go up you make more money if rates go down you make you lose more money this will cater to all these uh other kinds of users and they thought part of our rebrand as well well i think that's look i think there's an entire segment of the market that'll always be degen about those kinds of things i think you're smart to re to re-br not rebrand re-position some of that yeah but i also think actually a bear market plays into the the fixed yield for you guys like everybody's i think it it takes a few weeks after these crashes for it to really hit but i think what's going to happen is well i think people are already assessing this is where can i be more conservative i got really burned i got liquidated i got i've lost 90 of value on x token what can i do to make sure that i start preserving some of what i'm burning and so i actually think you guys could be in a very good place in the nearer term for people saying okay i need to de-risk some of what i'm doing and rebase tokens haven't worked out so well in some way so maybe i shouldn't always be in that world yeah maybe there's an integration for you that is i could imagine somebody like me who i play both sides i play some conservative and i play some aggressive but it would be very cool if there was a way for me to automatically siphon off some percentage of the gains i'm getting into a product like yours where it's like just some level of more conservative play for me might be interesting so i think you guys have a lot of potential right now yeah yeah i think we're trying to move towards that so i think traditionally one of the limitations of these similar protocols that like ours is that was that it was very difficult to use it like you have to go into one protocol you get the one token then you have to split it down into two tokens and you have to make a swap you provide liquidity to this pool and that pool and it's like a six step process and by the time you get to the end you're like losing it and we're trying to get it do it so that it's one transaction so if you want to get a fixed here it's just one transaction it's like a single transaction you can do everything in one go just click of a button submission deficit this is how much you're gonna get on maturity and that this is like our goal actually so that people it's easy to use it so that if you have some you know leftover cash just put it in there and i think our phantom deployment will help a lot with that because yeah you have to pay especially for fixed seals because you have to pay like 200 for a transaction yeah which kind of negates the whole point of the fixed yield because you're probably losing that much in the transaction fees unless you're depositing millions of dollars now we're gonna you know have the chance to showcase it and use it for the things you just mentioned yeah that's awesome have you are you guys considering tapping your old buddies or for whom you were attorneys to push this we have yeah so put a nice simple bank interface on it yeah for sure there are i know a lot of x not x bankers with bankers but probably also x bankers that work in the fixed income space and if you work in fixed income in banking like normally it's like the least sexy area of banking because you're doing fixed income which is the most boring stuff so when i actually talk to them about this and i pitch it to them they're like oh wow this is great this is super interesting and you're working crypto like wow so it's not easy it's not hard to try to convince them to you know join the project or promote it in some way or work together and then talk to their institutional investors to try to use it so we're trying trying a bunch of different angles and it's very early days we haven't it's been less than a year since we started the whole project but uh but i think we'll we'll get there we'll get there i look i think there's some potential there that's to tell you two quick things i just saw a company that got funded some ridiculous amount like two weeks ago i think and they're doing stable deposits where they're probably earning 20 on it and they're guaranteeing non-crypto consumers 10 on their money and they're just using plaid to connect to their bank accounts and there's obviously an appetite for that yeah the other interesting thing is i was talking to a guy today who is a very high net worth person and he was asking me about crypto i helped him on board with a little bitcoin and ethereum a couple weeks ago yeah yeah the whole bit and and just before the crash right before just a couple of days basically so i'm glad i wasn't trying to persuade him he came to me but here's the interesting thing i was having this conversation two hours before you and i got on this interview and he's an older man right he's 65 70 years old and he said what what in crypto can i do that i'm not risking the money my wife and i are living on but i'm also not risking the money i'm going to give to my kids i said let me ask you a question what does that look like for you is that a 10 play is that a five percent play he goes i would be over the moon for a five to ten percent play that i knew was safe and i could count on and he said i would do that all day long because i can't get that in the real world so i think you guys are i i think and i think there's a gateway for you to the institutional guys where you can shield you don't have to shield the complexity so much because they get complex topics then there's potentially some other potential biz dev integrations you guys could do i think i i think you're actually in a good place at a good time frankly yeah i agree and there are so many projects right now that are trying to bridge the gap between defy and traditional finance and what they're trying to do is take the d5 yields and then package it in some way and then they pass it on to the customer in the form of a bank account or something right and then they could use tempos and this is part of our business development efforts as a source of their fixed yield so they don't have to take on the risk themselves the yields falling they can hedge themselves right and get certainty that they're going to get that yield that they can take a little bit of a cut on and then they pass it on to the customer that makes total sense so this is one of the one of the things and that i think what you mentioned is right so there's a lot of a lot of people who are now entering into the crypto that don't have this risk profile they're more normal people they're they haven't been exposed to krypton since they were 16 years old so their whole brain is set up differently they don't want to risk everything in one go they just want to get some certainty about their yields that's one target group and institutions are obviously another one because they have mandates they don't some institutions ones that are or just funds that have fixed income strategies they are limited so they have to invest in this kind of stuff and then there's another whole different part is like this other blockchain projects and dows and that they need to have some certainty that they're going to get some cash on it and they want to be sure that like in a year's time they're going to have percent more and this is one way that they can do it now that's awesome i definitely see you guys being able to build up with treasuries it's funny i was talking to a guy the other day who set up a fund who i interviewed him i actually got to get his episode out he set up a fund but it's not really a fund in the traditional sense so it's not like a 220 where he's taking fees and commissions yeah these are people that want a taste of crypto and they he somehow has explained rebasing an olympus dow to them and they don't want to deposit directly they just want to deposit with a registered company of some kind so they set up this registered company he thinks he'll get this to a billion dollars and he closed like 40 million within three or four days of starting to talk about it and all he does is set this up and charge 3.3 and he's taking a check and buying the tokens right and staking it and that's all he's doing i'm like that's a pretty good gig man there's no pressure right you don't take any of that risk you have to custody the assets but you can pass that on to somebody else you don't have to you have to worry about it yeah good business it's pretty exciting to see all the potential ways that you guys have potentially to integrate obviously you have a limited amount of resources and staff to be able to do them all so part of the jungle is figuring out where you go first but i definitely see a nice growth growth path for you guys yeah i hope so i think yeah but part of our hiring efforts is like to put together like a good vdn marketing team and the dev team is really top-notch so they can they have very good productivity so they and also the there are a lot of very good ideas being floated around so i think the next few months are going to be interesting for sure yeah i mean you're in the typical startup dilemma right now it's you have all these opportunities which ones do you go for and which ones do you stand for and that's exciting but also it can be can wear you down yeah it's it is scary right like it's the typical dilemma is do i go in this one direction that's very specialized and then spend a lot of efforts on that and take a bet that's gonna work out do we branch out into a lot of it like a generalist protocol we see how that worked out for a lot of protocols doesn't really work out too well and then try to hedge your bets a little bit and then become this generalist protocol like all sorts of field farming and everything else i don't think that's really the solution we find like strong product market fit in one specific area which is what our focus is yeah yeah you start there and then later you can expand yeah yeah reach into other verticals or whatever you want to call them yeah like i said i think your timing is good i think the market's ready for you plus the move to phantom i i think they're just going to see explosive growth this year and i think they're the most undervalued thing in crypto right now so i think i think that's also going to be really strong for you anything else on the horizon for you guys you want to tell us about or things we should i think the most important thing is the phantom launch not only that but the tempest governance token will be also tradable on phantom so we're setting that up right now nice uh and then together with the actual pools that are going to be deployed in two or three weeks time we're going to have all sorts of pools available via urine so we have we have wbtc mem die usdc different pools with different maturity dates so there's a lot of different things that people can try out and obviously phantom is it doesn't cost two hundred dollars to make a transaction so you can play around with it a lot more i think where we will start to get a lot more feedback from there as well so i think that's a good good place to get started and check out the the website and everything else and we're also hiring we're still hiring we have four or five different positions right now you can check on angel list if you just put in tempos in there you'll see there's a i think there are five or six different positions there are still open across like marketing backhand front end and a lot of different uh positions that's uh that's something worth checking out if you're interested and it's tempest for everybody it's t-e-m-p-u-s uh the main website is tempest.finance yeah that's right all right so i ask everybody who comes on the show a question at the end and that is what project or person in dpi do you think is really blazing a trail or that you have a lot of respect for because you you really like what they build and how they operate or a project that you think is important there are so many projects but if there was one person i had like say is embodies e5 for me it's probably andre i got a reason someday i'm going to go back and tally up and see how because andrea cronier has i it's got to be 70 of the people i've spoken to that's awesome that's great yeah probably he is like he's the guy who didn't take uh vc mind didn't go down that route started off his own way to build the project and build a project that actually makes revenues and and makes money yeah that's so rare because i would say 90 of protocols right now they just operate on a liquidity mining basis that's unsustainable they end up diluting their own capital but andre didn't he decided not to go down that route instead of that he built a protocol that has a sustainable source of revenue by taking a cut on the services that they provide which is so rare it's like a traditional business and instead and i think i think that's what everybody should strive for so it's a good role model like also him personally i think he's uh he's a very good builder and then also the the project that he built is definitely top tier i'm advocating hard for revenue-based projects right now that is the model that the model rewards holders and that the model is to build something more sustainable so yeah this thing and i think the market the better market will teach people that that yes but that's what matters is that you have to generate cash and you have to get actual users that pay for the product and that's what like instead of having all these like modeled inflationary staking models all all across the ecosystem that just end up giving tokens from the treasury to people you have to actually take money from the users and give it to the stakers but we have we have this sustainable revenue model that is so valuable and i think overall once we get through this initial phase of crypto we're going to trend towards that and we're going to see that but it's just going to take some time totally agree that's why i sat on train the guys are on that on the right path yeah absolutely yeah absolutely totally listen david i really appreciate you spending time with us it sounds like a fascinating project i can't wait to see you guys launch on phantom i i think i think you guys will probably be a little busier even busier than you are now yeah and uh if everybody anybody looking that has good experience that's looking for a gig check out the angel list for tempest finance because this looks like a good project looks like a solid philosophy and it looks like you've got good good path ahead so thanks for coming on thanks very much for having me yeah man absolutely