WEBVTT

1
00:00:00.000 --> 00:00:07.280
Hello, everybody. My name is John Lee. I lead BD Partnerships, Affiliates, and Growth here at Vest.

2
00:00:07.800 --> 00:00:13.700
And I have here with me my wonderful boss, Justin. Justin, go ahead and introduce yourself.

3
00:00:13.880 --> 00:00:16.720
Hey, guys. My name is Justin. I'm the CEO and co-founder of Vest.

4
00:00:17.380 --> 00:00:21.920
Yeah, yeah. So we'll start off with a little bit of background. So as for me, before Vest,

5
00:00:21.920 --> 00:00:28.580
I was at CertiK, and then I was at a VC firm. I did a little bit of stint at BNB Chain.

6
00:00:29.260 --> 00:00:33.340
And then I got into Vest because actually, the first time that I talked to Justin,

7
00:00:33.520 --> 00:00:40.040
I instantly knew this is what I wanted to do. I trade myself. I was using Vest at the time,

8
00:00:40.120 --> 00:00:44.620
and it was just a no-brainer for me. Well, what about you, Justin?

9
00:00:45.400 --> 00:00:54.320
I think my background is a lot more complex than yours. I mean, that's a very simplification,

10
00:00:54.580 --> 00:01:00.480
but I think if you look at a lot of founders, my background is very, very different than your typical

11
00:01:00.480 --> 00:01:06.920
founder, right? The typical founder is someone that has done work in their industry for a decade

12
00:01:06.920 --> 00:01:12.640
plus, and then they become experts on that subject matter. And then they make a company

13
00:01:12.640 --> 00:01:18.520
on that industry. Whereas for me, it's been, to be honest, all over the place, right?

14
00:01:19.520 --> 00:01:26.340
I previously used to work at a cancer research at the National Cancer Institute and then realized that

15
00:01:26.340 --> 00:01:32.720
like, Hey, like there's a lot of just BS happening in that industry and really slow work due to just

16
00:01:32.720 --> 00:01:37.780
the way how governments and like FDA approval and all these things work. And then I worked at,

17
00:01:37.780 --> 00:01:45.480
uh, as a, um, uh, I don't know if I could say the exact position cause, but, but I, I worked under a U S

18
00:01:45.480 --> 00:01:55.220
Senator, um, handling a lot of his constituent, uh, stuff. Um, and then, uh, over time, like started

19
00:01:55.220 --> 00:01:59.840
doing more consumer stuff. I created a social company, we grew to a hundred thousand users, ended up selling

20
00:01:59.840 --> 00:02:06.080
that company, uh, did something with, um, some really, some really successful people. Uh, and then

21
00:02:06.080 --> 00:02:10.900
after a while started trading some of my own capital. And I think through that, um, that's when I really

22
00:02:10.900 --> 00:02:17.800
started to realize how rigged a lot of the current systems are. And, um, this is coming from like

23
00:02:17.800 --> 00:02:21.640
someone from like a market microstructure perspective, right? So my background is a little

24
00:02:21.640 --> 00:02:27.220
bit in HFT and quants. Um, the team that I work with has a lot of experience analyzing market

25
00:02:27.220 --> 00:02:31.400
and microstructure, uh, for many, many years, we've been doing a lot of open source research

26
00:02:31.400 --> 00:02:39.160
into stuff in the space. And we realized how, uh, predatory a lot of this stuff was not just for

27
00:02:39.160 --> 00:02:44.980
the user, but also for the sustainability of the exchange. So, uh, over time we decided to,

28
00:02:44.980 --> 00:02:49.620
uh, put our research into good use and start building it into an exchange that could be very

29
00:02:49.620 --> 00:02:54.680
friendly towards traders. So it's, it's a really long convoluted story. We can go into a bit more,

30
00:02:54.680 --> 00:02:58.440
but, um, yeah, there's just, just a lot.

31
00:02:59.020 --> 00:03:03.480
No, no, that, that, that's super interesting. So before, I mean, my, my next question is, is what is

32
00:03:03.480 --> 00:03:08.340
best, right? But before I get into that, your, your background was like very, very diverse. And then

33
00:03:08.340 --> 00:03:12.180
you got to trading and then you mentioned like open source research. Like, is there a place where

34
00:03:12.180 --> 00:03:14.760
like the, the viewers or like people can find this or?

35
00:03:15.200 --> 00:03:20.620
Yeah. So, so very funny story. Um, like, so I'll give you guys like the whole rundown actually.

36
00:03:20.620 --> 00:03:25.880
So, um, after, so I, I sold my first company, nothing to do with trading, nothing to do with

37
00:03:25.880 --> 00:03:31.960
crypto or, or fintech. Um, it was just a consumer company. We grew, it was like a, like a dating app,

38
00:03:32.000 --> 00:03:38.060
very similar to like Hinge, except, um, everyone's fully anonymous. And the idea was to, uh, match

39
00:03:38.060 --> 00:03:43.220
people without, um, focusing too much on their looks. Yeah. Obviously, you know, that, that doesn't

40
00:03:43.220 --> 00:03:47.800
really go far. Um, but we'll end up selling that company. And then, and then after we had

41
00:03:47.800 --> 00:03:54.300
like quite a bit of capital, uh, we were using that to, to trade like algorithmically and doing

42
00:03:54.300 --> 00:03:59.320
some HFT stuff on a lot of these early crypto exchanges. Right. Yeah. Um, and this is like

43
00:03:59.320 --> 00:04:04.780
back in the day in 2020, 2021, where, you know, you still had like Drift, um, perpetual

44
00:04:04.780 --> 00:04:09.700
protocol, like NFTperp, like all these up and coming perpetual futures exchanges on the

45
00:04:09.700 --> 00:04:14.540
crypto side, uh, where they're just like creating a bunch of random stuff. Um, that

46
00:04:14.540 --> 00:04:19.140
wasn't really the most sustainable. So, um, a sophisticated actor could come in and use

47
00:04:19.140 --> 00:04:22.560
that to make a lot of money. And then over time we started to realize that like, Hey,

48
00:04:22.560 --> 00:04:30.720
like, um, as like our alpha starts to slowly decay, uh, we like, like we are witnessing

49
00:04:30.720 --> 00:04:34.820
all these problems are, you know, we thought crypto was a future of exchanges and we were

50
00:04:34.820 --> 00:04:38.640
realizing how poorly built a lot of these exchanges were. So we started just doing

51
00:04:38.640 --> 00:04:43.880
open source research. Um, and we would spend hours and hours, um, each week, just, just,

52
00:04:44.020 --> 00:04:47.520
just honestly, like, just, you know, just like, like on our, like lunches, like we would

53
00:04:47.520 --> 00:04:50.820
just read academic research papers just for the love of the game, just, just for the love

54
00:04:50.820 --> 00:04:56.120
of the game, just for the love of the game. Okay. Um, like the most, uh, like I was, I was

55
00:04:56.120 --> 00:05:01.940
like, uh, in college back then. Right. And like, uh, the most like, uh, autistic stuff

56
00:05:01.940 --> 00:05:06.660
you could ever do as like a, as a 21, 22 year old, just like, you know, don't go out,

57
00:05:06.660 --> 00:05:10.140
like, don't touch grass. You're just sitting at home with your buddies, just reading academic

58
00:05:10.140 --> 00:05:14.740
research papers and figuring out how we can, uh, improve the space. Um, and we were just

59
00:05:14.740 --> 00:05:19.340
publishing stuff, publishing stuff on this like forum that we created, um, without even like

60
00:05:19.340 --> 00:05:23.820
an expectation of where it would go. Uh, we were just doing this for stuff that we thought

61
00:05:23.820 --> 00:05:29.620
would be the betterment of the industry. Um, so, uh, yeah. And then, and then over time,

62
00:05:29.700 --> 00:05:36.260
funny enough, like a lot of people, um, like, like Jane Street and a lot of, uh, of our investors just

63
00:05:36.260 --> 00:05:40.840
started to see our research. And that actually was like the first entrance. Um, like, even though

64
00:05:40.840 --> 00:05:44.360
we did that just for the betterment of the space, that was actually how a lot of these, uh, really

65
00:05:44.360 --> 00:05:49.320
sophisticated players really started to understand us and get to know us better. So it was a little

66
00:05:49.320 --> 00:05:53.260
bit of like a kickstart to the, the like journey and credibility of Vest a little.

67
00:05:53.700 --> 00:05:58.740
That's really cool. So, so all of this leads into Vest, right? So, so like for the viewers at home

68
00:05:58.740 --> 00:06:05.980
who doesn't know what Vest is, well then what is Vest? Yeah. So, um, I think that's a great

69
00:06:05.980 --> 00:06:11.720
question. So Vest is at a fundamental level, two, two things. Um, the first is we're a decentralized

70
00:06:11.720 --> 00:06:16.620
perpetual futures exchange. Yeah. So what that means, um, cause I know that's a lot of words. Uh,

71
00:06:16.620 --> 00:06:22.700
what that means is, um, instead of Vest being hosted on servers that are owned by the company,

72
00:06:22.700 --> 00:06:28.800
uh, Vest is hosted by, uh, the blockchain, right? Um, effectively what that means is like,

73
00:06:28.800 --> 00:06:34.480
instead of trusting like the company to be fully honest and transparent and, uh, like operate these,

74
00:06:34.640 --> 00:06:39.540
uh, the servers and the code with full integrity, uh, you can just trust, um, people all over the

75
00:06:39.540 --> 00:06:45.260
world that kind of run and power the blockchain to, uh, like for the exchange to, to be fully

76
00:06:45.260 --> 00:06:49.660
credibly honest and, and transparent to its users. Um, so like a good example of, of how that

77
00:06:49.660 --> 00:06:53.920
looks today, um, especially cause we have a lot of prop trading users is for example, you

78
00:06:53.920 --> 00:06:59.040
can see the payouts, right? Um, you can see exactly how many payouts go out and you can

79
00:06:59.040 --> 00:07:06.080
see, um, you know, how much of our reserves come in to, to, to fund these payouts. Um,

80
00:07:06.080 --> 00:07:10.740
so that's one. Um, so we're, we're a decentralized perpetual futures exchange. Um, we're a perps

81
00:07:10.740 --> 00:07:15.920
exchange that's run on the blockchain. And then the second thing, um, which a lot of our users

82
00:07:15.920 --> 00:07:22.040
these days really, really love is, um, our, our funded account model. Yeah. Right. So

83
00:07:22.040 --> 00:07:29.080
Vest is a, uh, really hot and up and coming funded accounts, um, or prop, uh, model that

84
00:07:29.080 --> 00:07:34.180
has just really gathered a lot of attention and growth these days. And I think the fundamental

85
00:07:34.180 --> 00:07:40.460
difference about us and other prop firms is that, um, we designed it in a way that is,

86
00:07:40.460 --> 00:07:46.420
uh, really, really for the trader. I can go a little bit about that, but, um, please do.

87
00:07:46.660 --> 00:07:53.420
Yeah. Yeah. Yeah. So, so I think like at the, at the highest level, right. Or to be honest,

88
00:07:53.420 --> 00:07:58.680
like, why don't I take a step back? Cause like the way how I see it is like, um, we're very,

89
00:07:58.740 --> 00:08:05.260
very different than other prop firms. Uh, and that's not because like, you know, like we saw

90
00:08:05.260 --> 00:08:08.280
other prop firms and we were like, Oh, like we don't think they do it correctly. It's actually

91
00:08:08.280 --> 00:08:14.700
the complete opposite. Um, we saw it. Uh, we, we actually never really, um, took a lot

92
00:08:14.700 --> 00:08:18.100
of analysis from the current prop firm industry. Uh, we just did it. What we thought would be

93
00:08:18.100 --> 00:08:22.400
like a complete blank slate, what we thought would be the best way to serve these customers.

94
00:08:23.220 --> 00:08:27.700
I think like a good way to explain it would be like, let's say we had a goal of trying to

95
00:08:27.700 --> 00:08:33.140
get someone from like point A to point B. Right. Um, if you ask people back in like, I don't

96
00:08:33.140 --> 00:08:37.940
know, like the, uh, when did the car come out? Like, like the 1800s or the 1900s,

97
00:08:37.940 --> 00:08:43.000
yeah. You ask people back then, like, Hey, like, uh, like how do you, how do you get

98
00:08:43.000 --> 00:08:46.860
from point A to point B faster? They would say, Oh, I want a faster or a bigger, stronger

99
00:08:46.860 --> 00:08:51.520
horse. Right. Um, and I think that's a very like same thing for Vest where it's like, uh,

100
00:08:51.520 --> 00:08:57.560
instead of kind of looking at what the existing industry had, um, we designed everything from

101
00:08:57.560 --> 00:09:01.620
the ground principle, like from, from, from, from what, like what we thought was truly best

102
00:09:01.620 --> 00:09:06.840
for the trader. So we built quite a bit of things up from scratch. Um, number one is

103
00:09:06.840 --> 00:09:11.120
like we built the exchange, um, which has natural price discovery. And then we also

104
00:09:11.120 --> 00:09:17.140
built the prop firm on top. And what ultimately this allows us to create is this way that truly

105
00:09:17.140 --> 00:09:21.520
is beneficial to the user. Cause as you guys may know, the way how prop models work is,

106
00:09:21.640 --> 00:09:26.900
uh, it's a B-book model, right? So it creates this conflict of interest between, uh, the,

107
00:09:26.960 --> 00:09:33.400
the trader and the prop firm, because the traders make money from the prop firm's capital. So whenever

108
00:09:33.400 --> 00:09:37.760
traders make money, the prop firm loses money. Um, and that creates a lot of these like weird

109
00:09:37.760 --> 00:09:43.460
complex rules that, um, you know, I think one is like really hard to understand, but two really

110
00:09:43.460 --> 00:09:50.120
hard to trade against, um, on Vest, like you have some of the most simplest rules and you can even

111
00:09:50.120 --> 00:09:55.900
customize it to just make it even more simple. Um, so on Vest, like you only have two rules,

112
00:09:55.940 --> 00:10:02.240
which is to try to hit your, you know, profit target without hitting your, uh, max drawdown or

113
00:10:02.240 --> 00:10:10.840
daily loss. Yeah. Um, and, and yeah, like I, so I think like Vest is, uh, like, like it's funny

114
00:10:10.840 --> 00:10:16.600
because the way how we've designed it this way has really trickled down to like second, third,

115
00:10:16.600 --> 00:10:22.220
and like fourth order effects, which is ultimately the most simplest prop firm in the, in the world.

116
00:10:23.820 --> 00:10:30.060
I got you. So, I mean, that, that was a lot, right? So, and don't cut this part out. Shout out

117
00:10:30.060 --> 00:10:36.000
to my guys at home, Wiz and Matty, right? Uh, Vest prop firm, uh, out there for future traders. But

118
00:10:36.000 --> 00:10:40.720
in your opinion, Justin, so if you were a prop trader yourself, right, coming from traditional

119
00:10:40.720 --> 00:10:46.520
prop firms, why would you want to trade on Vest versus let's say any traditional?

120
00:10:46.600 --> 00:10:53.040
Yeah. So I think the abstract, like, um, kind of philosophical answer, or like maybe you might

121
00:10:53.040 --> 00:10:59.520
even call it ethical answers that Vest is probably the only prop firm out there that has its intentions

122
00:10:59.520 --> 00:11:04.180
aligned with the trader. Like at Vest, we're not designed such that when a trader wins, like

123
00:11:04.180 --> 00:11:09.900
we lose, uh, we actually win alongside the trader. Right. So I think, uh, because of that,

124
00:11:09.900 --> 00:11:14.580
like we, we actually want our traders to win and this ultimately trickles down to like

125
00:11:14.580 --> 00:11:19.040
second, third, fourth order effects. Whereas like, for example, one in three traders on Vest

126
00:11:19.040 --> 00:11:25.080
receive a payout. Um, in normal prop firms, that's like, that's like, it's like six times

127
00:11:25.080 --> 00:11:29.080
the industry average. Yeah. To be honest, I think on normal prop firms, like only like four

128
00:11:29.080 --> 00:11:33.960
or 5% people ever receive a payout in their entire lifetime. Um, and we've only been out

129
00:11:33.960 --> 00:11:39.080
for, uh, like we've had this influx of growth for about like a few weeks. Right. So I think

130
00:11:39.080 --> 00:11:43.500
that number will continue to grow. Um, the second thing is, as I said before, the, the simple

131
00:11:43.500 --> 00:11:49.700
rules, right? So Vest has some of the most simplest rules in the industry. And the reason

132
00:11:49.700 --> 00:11:54.820
why I think this is really important is because, um, we're also introducing the perpetual future,

133
00:11:54.820 --> 00:12:01.060
uh, to prop, right? So if you want to get people to understand the perpetual future, uh, you

134
00:12:01.060 --> 00:12:08.300
can't add all these like complex rules, like, uh, consistency, like, um, uh, you know, like, like,

135
00:12:08.400 --> 00:12:11.540
you know, like a trailing drawdown, like all this, you know, and then like weird payout stuff,

136
00:12:11.600 --> 00:12:16.200
right? You kind of want to make it as close to its raw primitive form as much as possible,

137
00:12:16.220 --> 00:12:21.220
which is a perpetual future. So the less rules you add on top of it, uh, in my opinion, the easier

138
00:12:21.220 --> 00:12:28.360
people will understand. Yeah. Yeah. Yeah. Okay. So thank you for sharing all of that, by the way.

139
00:12:28.360 --> 00:12:34.000
So without getting too technical and boring, you know, all the viewers at home, uh, I mean,

140
00:12:34.000 --> 00:12:38.700
I'm sure a lot of people have seen the growth of Vest and the popularity of Vest lately. So,

141
00:12:38.700 --> 00:12:43.820
because I want to circle back on what you said earlier in that Vest is not just a prop firm.

142
00:12:43.820 --> 00:12:48.340
We're, we're an exchange, right? I've been here with the team like over two years, right? It's been

143
00:12:48.340 --> 00:12:53.020
a long time. We've, we've pivoted like a million times, right? So maybe like, like walk everybody

144
00:12:53.020 --> 00:12:58.660
through like how we got to where we are. Yeah. So, um, I can go back to like the dark ages,

145
00:12:58.660 --> 00:13:06.700
man. It's like, so if you go to research.vest.xyz, you'll see a paper called ZK risk that, um,

146
00:13:06.700 --> 00:13:13.260
me and some of the co-founders, my, my best buddies from college, uh, published. Um, the whole point of

147
00:13:13.260 --> 00:13:18.340
ZK risk, um, was inspired from all of the blowups that happen in the crypto industry.

148
00:13:18.540 --> 00:13:24.120
So stuff like, um, not just FTX on the exchange level, but stuff like Celsius and these other

149
00:13:24.120 --> 00:13:29.180
firms on the lending level. Right. Um, the, the original, like our original goal, like, and,

150
00:13:29.180 --> 00:13:33.420
and we got, it wasn't just us that got fucked by a lot of these blowups. Right. It was also a lot

151
00:13:33.420 --> 00:13:36.960
of like, we were like all these people around us. Right. And I'm not talking about like, you know,

152
00:13:36.960 --> 00:13:40.860
like the average, like crypto bro. It's like, Oh, like they have like six, seven figs and like

153
00:13:40.860 --> 00:13:46.520
some exchange. I'm talking about families, right. Um, families, people where, you know, back at that

154
00:13:46.520 --> 00:13:51.600
time, there, there were people that, um, maybe, you know, not to the, like the wise decision, but,

155
00:13:51.700 --> 00:13:56.340
but they put a lot of money invested into these exchanges. So our goal back then was to try to

156
00:13:56.340 --> 00:14:02.220
create a exchange that could, uh, cryptographically and mathematically prove solvency, not just within

157
00:14:02.220 --> 00:14:07.960
like a given time, but also, uh, within like a set amount of time. So like within 24 hours, right.

158
00:14:08.560 --> 00:14:13.040
I can explain, um, that, but like, that's a whole nother can of worms. So we started off as

159
00:14:13.040 --> 00:14:18.220
this, um, as like building an exchange that could guarantee solvency and it could guarantee that

160
00:14:18.220 --> 00:14:25.180
it would not blow up by dynamically pricing trades against its users. Yeah. Um, and then, um, you

161
00:14:25.180 --> 00:14:32.640
know, over time, like we realized that like, uh, at the end of the day, like it's, it's not,

162
00:14:32.940 --> 00:14:40.400
it's, it's our job to build what's safe towards the customer. Um, but then it's also our job to

163
00:14:40.400 --> 00:14:46.940
build it in a way that the customer will actually like it. Right. So if we build an exchange that

164
00:14:46.940 --> 00:14:52.420
could guarantee solvency, but at the end of the day, like it charges like, you know, like 10 times

165
00:14:52.420 --> 00:14:57.460
more fees. Yeah. Right. That's not something that, uh, traders might actually like. Right. So,

166
00:14:57.460 --> 00:15:00.340
so that, that's, that's what we we've started and that's what like we eventually learned where it's

167
00:15:00.340 --> 00:15:03.960
like, okay, like we understand how important it is to build something that is sustainable

168
00:15:03.960 --> 00:15:09.000
and very well intentional and well intentioned designed for the trader. Uh, but we also have

169
00:15:09.000 --> 00:15:14.080
to package it in a way that, that people like, um, and then over time, like our, our thesis with

170
00:15:14.080 --> 00:15:20.280
crypto is that, uh, like the blockchain technology is, is absolutely great. I like blockchain as a

171
00:15:20.280 --> 00:15:25.180
technology to guarantee, uh, trustlessness, transparency, um, all this different kinds

172
00:15:25.180 --> 00:15:29.200
of stuff is actually great, but, uh, create an exchange for people can trade, you know, magic

173
00:15:29.200 --> 00:15:33.980
internet coins, uh, to be honest is, is not the, not, not, not the best thing for, for traders.

174
00:15:33.980 --> 00:15:41.560
Right. So, um, over time, like we really wanted to push this, uh, gap towards, um, letting more

175
00:15:41.560 --> 00:15:46.580
people trade traditional products, um, that might actually have real utility or, or, or real,

176
00:15:47.580 --> 00:15:57.560
real, real value. Um, so, uh, that that's when we decided to, um, really, uh, bring, um, perpetual

177
00:15:57.560 --> 00:16:02.400
futures to the equity side. Right. Um, and this is something that we've always wanted to do for a

178
00:16:02.400 --> 00:16:07.360
very, very, very long time. So, so one of my partners, uh, used to lead, uh, trading teams at

179
00:16:07.360 --> 00:16:11.840
Optiver, right. And those of you guys who don't know, Optiver is one of the largest options, uh,

180
00:16:11.840 --> 00:16:19.820
market makers, um, for, for the, for us stocks and indices. So, um, like we've witnessed how,

181
00:16:19.960 --> 00:16:24.460
you know, the option is the most popular derivative in terms of notional contracts

182
00:16:24.460 --> 00:16:29.720
traded within the U S for U S stocks. And we've quite literally like witnessed how much

183
00:16:29.720 --> 00:16:34.580
a retail is losing from, uh, just trading options. Right. Cause if you think about it, options were

184
00:16:34.580 --> 00:16:41.720
primarily used for, uh, hedging risk, but, um, within the U S there's not many forms of, uh,

185
00:16:41.720 --> 00:16:46.520
leverage that retail users have access to. So they end up using just, you know, zero-DTE options as,

186
00:16:46.600 --> 00:16:51.880
as their way to trade with leverage. And you end up just blowing up and losing a crap ton of money.

187
00:16:52.540 --> 00:16:57.860
Um, so, so, so we've always known how, how big of a problem, the, the leverage retail trading space

188
00:16:57.860 --> 00:17:03.180
was within the U S and not just within the U S, but you know, globally, um, you have stuff like CFDs

189
00:17:03.180 --> 00:17:08.880
where they're a lot more simple to use in options, but, uh, most CFDs, in fact, I don't know a single

190
00:17:08.880 --> 00:17:14.180
CFD that's fully A-book, right? Like most CFD products are B-book where you're trading against

191
00:17:14.180 --> 00:17:18.180
the, the firm. So you're trading against this casino and they want you to lose. So they end up banning

192
00:17:18.180 --> 00:17:22.520
you if you'll make too much money. Yeah. So, so we, we've, we've always recognized that there is

193
00:17:22.520 --> 00:17:28.900
a, a growing problem to be able to offer a very friendly and intuitive and not just, you know,

194
00:17:28.900 --> 00:17:35.300
friendly and intuitive, but a, a, a business and a, and a platform that is truly, truly for the

195
00:17:35.300 --> 00:17:40.880
trader. Um, and not just in terms of like the rules and, and how it ultimately turns, turns out

196
00:17:40.880 --> 00:17:45.680
into its form factor, but really just the way how it's, it's fundamentally designed. Yeah. Right.

197
00:17:46.560 --> 00:17:50.200
Um, and, and I think a lot of things kind of like click together where we were just like,

198
00:17:50.200 --> 00:17:56.580
okay, um, if, if we can go out and we can introduce the perpetual future to, uh, traders

199
00:17:56.580 --> 00:18:00.840
all around the globe and, and to get them to try to use this product instead of, you know,

200
00:18:00.960 --> 00:18:05.180
CFDs where there's a huge conflict of interest or options where it's just really, really hard

201
00:18:05.180 --> 00:18:09.280
to understand. And, you know, to be honest, let's be real. Like it's, it's not many people

202
00:18:09.280 --> 00:18:14.420
truly like not many people can, can price and understand the math of, of options, uh, to its

203
00:18:14.420 --> 00:18:19.260
deepest level. Um, nor do, nor do I think you should, to be honest, cause that's, that's

204
00:18:19.260 --> 00:18:24.060
really complicated for just normal trading. Um, so we put two and two together and that's

205
00:18:24.060 --> 00:18:28.900
when we realized, um, Hey, like if we could introduce this to the retail market and to,

206
00:18:28.900 --> 00:18:33.220
to, to, to get them to trade with this, what we believe is ultimately more friendly asset

207
00:18:33.220 --> 00:18:38.360
class. Um, it could, it could really, really help a lot of traders out there.

208
00:18:38.800 --> 00:18:44.260
Okay. It's funny that you mentioned that, right? So, so the team is from Optiver and then

209
00:18:44.260 --> 00:18:47.940
like you've done a lot of, you know, high frequency trading, like research yourself, a

210
00:18:47.940 --> 00:18:53.140
lot of, you know, on, on sort of your own reading and then your own blog posts that you

211
00:18:53.140 --> 00:18:53.900
posted online.

212
00:18:53.900 --> 00:18:58.900
Yeah. And recently from, you know, it was like some of the latest, you know, popularity

213
00:18:58.900 --> 00:19:03.540
that Vest has gotten. Yeah. They, they've surfaced the point about, you know, us being backed by

214
00:19:03.540 --> 00:19:08.620
Jane Street. Right. And then just now you mentioned that Jane Street noticed you for the, for the

215
00:19:08.620 --> 00:19:12.580
research that you put out. So tell me a bit more about that. Yeah. So, um, it wasn't just

216
00:19:12.580 --> 00:19:17.200
Jane Street, but, um, it was also a lot of other, uh, really well-known people in the space.

217
00:19:17.300 --> 00:19:24.680
Like who, um, like, like what, what firm if you, uh, uh, I'd rather not because, um, I, yeah,

218
00:19:24.680 --> 00:19:30.680
yeah. Um, but, but, but, but a lot of our backers, a lot of our backers, um, to be honest,

219
00:19:30.680 --> 00:19:35.800
that was a very, um, like a really big moment for us because, you know, just imagine a bunch

220
00:19:35.800 --> 00:19:41.480
of like college kids. Yeah. Uh, just like in like some like dark basement, like not like,

221
00:19:41.620 --> 00:19:46.020
you know, like we were, I think we were junior or senior year at that time. Um, and you know,

222
00:19:46.080 --> 00:19:48.500
junior or senior year, you're supposed to go out, you're supposed, I mean, you're supposed to go

223
00:19:48.500 --> 00:19:55.260
out party. Um, yeah, we went to, um, you know, like, like University of Pennsylvania, which, uh,

224
00:19:55.360 --> 00:20:01.020
at least like amongst the Ivies is kind of like a party school. Yeah. So, um, yeah, so, so, so we

225
00:20:01.020 --> 00:20:06.440
were doing like the complete opposite of, of what any normal 21, 22 year old kid should do. Um,

226
00:20:07.120 --> 00:20:12.820
and we were literally just, uh, finding ways to, um, create a sustainable exchange that could

227
00:20:12.820 --> 00:20:18.500
guarantee liquidity for, um, a lot of these crypto assets that are super volatile and would end up

228
00:20:18.500 --> 00:20:22.380
causing a lot of bad debt that would end up blowing up the exchange. But we were looking for

229
00:20:22.380 --> 00:20:28.860
ways to kind of like just create this in a way. And then, um, you know, one thing led to another,

230
00:20:29.020 --> 00:20:33.920
you know, we were peer reviewing with some of our friends at Jump Trading. Um, they, uh, they,

231
00:20:33.920 --> 00:20:38.760
they brought some friends along at some other firms. One of them was Jane Street. And then the

232
00:20:38.760 --> 00:20:43.000
guy who reviewed at Jane Street, um, really looked at the stuff that we were doing and they said,

233
00:20:43.100 --> 00:20:48.600
uh, this is the most innovative thing that we've seen this entire year. Yeah. And, um, you know,

234
00:20:48.620 --> 00:20:52.640
at the time, like we were still considering building on exchange, but, uh, we, we, you know,

235
00:20:52.660 --> 00:20:56.100
when you build an exchange, there's still a lot of stuff that needs to get put into it, right? Like

236
00:20:56.100 --> 00:21:01.220
the marketing, the, the compliance, um, all these different kinds of things, but just off

237
00:21:01.220 --> 00:21:06.260
of that idea alone, where you could build an exchange that was truly safe for the users,

238
00:21:06.260 --> 00:21:13.860
uh, that gave us a lot of just like, oh, like validation, validation, validation, because,

239
00:21:13.860 --> 00:21:18.420
um, uh, you know, in, in the crypto industry, there's a lot of, uh, people that, um,

240
00:21:18.880 --> 00:21:25.140
like, uh, there's a lot of just like overly done technical stuff that doesn't really get anywhere.

241
00:21:25.340 --> 00:21:29.040
Right. Um, I think, you know, there's, there's a reason for that because you want to just like,

242
00:21:29.040 --> 00:21:34.880
you know, pump the VC bags and just get like a super high valuation. But, um, like we were very,

243
00:21:34.880 --> 00:21:38.820
very uncertain about like, you know, like maybe people want to just build, like people, people don't

244
00:21:38.820 --> 00:21:42.380
want this, right. Yeah. Um, people just want an exchange that they can gamble and, you know,

245
00:21:42.380 --> 00:21:47.420
they can, they can risk, um, the exchange blowing up. But, but when, when Jane Street came in and

246
00:21:47.420 --> 00:21:51.080
said, you know, really validate a lot of our work, um, and it wasn't just them, but it was a lot of

247
00:21:51.080 --> 00:21:56.100
people that we just really respect in the industry. Uh, that gave us a lot of validation and the

248
00:21:56.100 --> 00:22:02.340
comfort to be like, yeah, like, uh, what we're doing, um, is what is ultimately good for the

249
00:22:02.340 --> 00:22:07.360
industry. Um, and they gave us some funding and, um, you know, we went from like a couple of broke

250
00:22:07.360 --> 00:22:13.360
college kids that were just eating like Chipotle every day to, um, I mean, we were still like being

251
00:22:13.360 --> 00:22:18.020
like super conservative on cash. So instead of Chipotle, we were eating a Qdoba, right. So like a few

252
00:22:18.020 --> 00:22:23.080
dollars more for, for lunch meal. Um, okay. I mean, you, you say we like a couple of times,

253
00:22:23.080 --> 00:22:27.380
right. Is this like, are you, are you talking about your co-founders? Like, like what do you

254
00:22:27.380 --> 00:22:33.420
mean by we? Well, well, I think when that story I'm talking about, um, I was talking about my,

255
00:22:33.500 --> 00:22:38.400
my, my co-founders. So I have two co-founders, um, Max and Rick. Yeah. They're, they're my two

256
00:22:38.400 --> 00:22:44.280
best friends. Yeah. Okay. So, yeah. Um, so you guys are like junior, senior year at college,

257
00:22:44.280 --> 00:22:50.380
right. At UPenn. Yeah. Just not going out, just at home reading, literally, literally like

258
00:22:50.380 --> 00:22:54.980
just reading research paper, doing research. Yeah. And then like these Jump Trading guys,

259
00:22:55.120 --> 00:23:00.480
Jane Street guys, like, like, like extremely sophisticated market participants validated your

260
00:23:00.480 --> 00:23:05.760
work. And that's what, you know, basically kickstarted this. Yeah. And it's super funny.

261
00:23:05.760 --> 00:23:09.440
Cause like, um, we, we roomed with two other people, um, who were like, kind of like the

262
00:23:09.440 --> 00:23:13.980
complete opposite of us. Like they're, they're kind of like frat bros. Yeah. Um, so, so there'd

263
00:23:13.980 --> 00:23:18.500
be like Friday nights where there'd be like girls at our house and then you're reading the paper.

264
00:23:18.820 --> 00:23:21.760
No, no, no. We're literally like, like you're doing math in the, in the corner. Yeah. Like

265
00:23:21.760 --> 00:23:27.780
quite literally, quite literally. Um, there, there's many times, um, where like, uh, you know,

266
00:23:27.780 --> 00:23:32.100
like people like they, they, they organize a lot of like group trips. Um, and then we were

267
00:23:32.100 --> 00:23:34.920
just like, no, like we don't want to go. We just like stay in here and just

268
00:23:34.920 --> 00:23:39.160
like, I got to do this math problem, bro. Exactly. Exactly. And like, so like, I want

269
00:23:39.160 --> 00:23:42.860
you to try to imagine that time. Cause like, I can't, um, yeah. Cause like literally, literally

270
00:23:42.860 --> 00:23:47.180
it wasn't going anywhere. It wasn't like, um, like we had no idea if, if this would turn

271
00:23:47.180 --> 00:23:51.440
into ultimate business. It was just pure out of like curiosity and just pure, uh, obsession

272
00:23:51.440 --> 00:23:57.080
over trying to solve this problem. Okay. Awesome. So, uh, I mean, I, I think that we've

273
00:23:57.080 --> 00:24:03.500
talked a lot of, you know, how, how Vest got to be, you know, where Vest is today, you

274
00:24:03.500 --> 00:24:07.440
know, what leads you to this part, like, you know, the team and everything. So I guess

275
00:24:07.440 --> 00:24:11.460
we'll end this off with, you know, where is Vest going to be, you know, where, where is

276
00:24:11.460 --> 00:24:13.140
Vest going to go? Where, where are we going to take this?

277
00:24:13.480 --> 00:24:19.620
That's a great question. So, um, our, our mission at the end of the day is to, uh, really

278
00:24:19.620 --> 00:24:24.180
invoke our belief and, and, and, and just make our kind of like, just like put our

279
00:24:24.180 --> 00:24:29.180
belief into existence that the current, uh, trading platforms out there are not

280
00:24:29.180 --> 00:24:34.400
friendly towards retail traders. Um, like whether that's options, CFDs, um, the

281
00:24:34.400 --> 00:24:40.020
existing, like even just the way how a lot of these products were built. Right. Um, so

282
00:24:40.020 --> 00:24:44.400
at Vest, uh, we're going to continue to try our best to introduce the perpetual

283
00:24:44.400 --> 00:24:49.080
future to the, not only, you know, CFD futures and options traders, but to be

284
00:24:49.080 --> 00:24:53.640
honest to the rest of the world. Right. Uh, right now we believe that venue is

285
00:24:53.640 --> 00:24:57.900
still going to be prop because, you know, prop is really good for limiting your

286
00:24:57.900 --> 00:25:02.960
downside. Um, and, you know, trade someone else's capital. Uh, but eventually

287
00:25:02.960 --> 00:25:06.120
that will also, you know, like people will eventually just prefer to just start

288
00:25:06.120 --> 00:25:09.160
training their own money, right. As they start to understand this product a lot

289
00:25:09.160 --> 00:25:14.100
better. So it's going to be our goal to educate the rest of the world to

290
00:25:14.100 --> 00:25:18.880
understand perpetual futures through prop, but then, uh, over time,

291
00:25:18.880 --> 00:25:25.400
really builds an exchange that, um, is one just interest aligned, uh, both from

292
00:25:25.400 --> 00:25:28.540
like a fundamentals, like the way how it's built for also from a UI and UX

293
00:25:28.540 --> 00:25:33.760
principles. Yeah. Um, and two, uh, something that many, many retail traders

294
00:25:33.760 --> 00:25:40.480
can, can come on, um, and, and, and just trade 24 seven. Another thing that I

295
00:25:40.480 --> 00:25:44.440
kind of want to mention is, is also the 24 seven part. Um, I believe that the

296
00:25:44.440 --> 00:25:49.580
world is, uh, becoming more and more global. And what I mean by that is an

297
00:25:49.580 --> 00:25:53.000
event that happens in China is just as relevant as an event that happens in the

298
00:25:53.000 --> 00:25:57.260
U S right. Right. Um, you can think of it like, you know, for example, like

299
00:25:57.260 --> 00:26:04.140
Taiwan, 70% of, uh, Taiwan or like TSMC, right? 70% of, uh, TSMC revenue

300
00:26:04.140 --> 00:26:07.520
comes from North American companies. So at that point, it's kind of like a North

301
00:26:07.520 --> 00:26:12.380
American company. Yeah. But the idea where you can only trade, you know, some

302
00:26:12.380 --> 00:26:20.480
stocks at like a certain close period time of the day, uh, even though events all

303
00:26:20.480 --> 00:26:25.840
around the world impact this company is a very, very archaic idea. Yeah. Now you can

304
00:26:25.840 --> 00:26:29.260
do a quick thought experiment of like, okay, what happens if, uh, people could

305
00:26:29.260 --> 00:26:35.840
teleport, uh, from like from the U S to, to China or to like Taiwan. Right. Um, where

306
00:26:35.840 --> 00:26:39.940
we, where we still have stuff like local currency, right. Where we still have, um,

307
00:26:39.940 --> 00:26:46.560
stuff like, um, you know, like down to even like different stock markets. Right. Um, it's

308
00:26:46.560 --> 00:26:53.640
my belief that stock markets will eventually turn 24 seven. Um, and, uh, we as people that

309
00:26:53.640 --> 00:26:56.980
are ultimately believing in and building towards the space, uh, we, we believe

310
00:26:56.980 --> 00:27:01.840
perpetual futures will lead that charge. And we hope that we can, uh, through this

311
00:27:01.840 --> 00:27:06.460
form factor, get people used to trading 24 seven, both from like a timescale, but

312
00:27:06.460 --> 00:27:10.880
also with the, the derivatives that we offer them. Awesome. Well, that's all we

313
00:27:10.880 --> 00:27:14.560
have for you guys here today. Thank you very much for tuning in. Justin, thank you for

314
00:27:14.560 --> 00:27:16.320
having me.