Original author: Meow, Steve Chen
Original translation: Peisen, BlockBeats
Editors note: Jupiter co-founder Meow and YouTube co-founder Steve Chen had a conversation around the concept of UGM (user-generated money), exploring in depth how technology has gradually transformed from its initial innovation stage to a service that is popular around the world, and the importance of the community in this process.
Steve Chen co-founded YouTube with Chad Hurley in 2005 and helped lead the company to its acquisition by Google for $1.65 billion less than a year after the site launched. Prior to joining YouTube, Steve was one of the first product engineers at PayPal. He led development efforts and served as an engineering manager on several key projects.
During the conversation, Steve said that he and Meow have many mutual friends in Silicon Valley, but they got to know each other because of the meme coin PAJAMAS and its crypto community. Meow is also curious about Steves experience in joining Web3 from a community member because of his love for meme coins, and believes that the UGC concept in the Web2 era has something in common with the UGM concept in the Web3 era.
TL;DR
Steve Chen believes that the current Web3 technology is mature enough and has been proven to be effective, but Web3 is extremely lacking in trust, so how to further promote its widespread application is a difficult problem.
Meow believes that the community is the core of value creation. Technology and investment are just tools. The real driving force lies in community participation and construction. The decentralization and creativity of the crypto community are the key to promoting the development of this field.
Steve Chen believes that the current encryption technology and community building are similar to the early development stage of YouTube and are full of potential.
Meow compares user-generated content (UGC) on YouTube to user-generated currency (UGM) in DeFi, believing that in the future everyone may be able to create their own cryptocurrency.
Steve Chen joined Web3 because of the meme coin named after his cat, and compared the fun of joining the meme community to the success of YouTube. He said that what he saw and heard in the crypto community was much more advanced than anything he saw among the billions of users in Web2.
Meow once again emphasized that the future of encryption is the PPP community, and believed that the success of this field lies in long-term sustainable development and win-win for the community, rather than short-term profit acquisition.
Steve Chen: Welcome to the place. Its an honor to speak with you, but I think we should start by explaining how we got started. Because just 72 hours ago, I had no idea that we would be meeting, let alone seeing you here. Its kind of crazy. It also explains what the world looks like to me as I enter the whole Web3 ecosystem.
Meow: Yeah, it was really interesting because we had only met for less than 70 hours and then we started talking and found out that we actually had a lot of common connections. Maybe we knew some mutual friends before, but we met in a completely random global network.
Steve Chen: We had actually been communicating online for a few weeks before this. But even so, it was like a completely different world. I have been in Silicon Valley for 20 years and have been in frequent contact with some people there, especially in the Web3 field, even including the co-founders of the company I founded before. It was incredible that our meeting was completely random.
Do UGC on YouTube and do UGM in Web3
YouTubes real value is created by its users
Meow: What we are talking about now, I think, is very representative of how the crypto world works, which is more about finding opportunities for collaboration and then exploring along those lines. Both of us have been in Silicon Valley for a while, and in Silicon Valley, people feel that the atmosphere there is already very informal, especially compared to traditional Fortune 500 companies. But if you look at the crypto world, its even more informal. We have even made multi-million dollar deals and established relationships through Telegram chats, and we discuss some things on Spaces.
Crypto has really democratized the creation of money, and the creation of assets. You no longer need a government to create money, you no longer need a stock exchange to create an asset, and you no longer need CME (Chicago Mercantile Exchange) to make it a tradable commodity. You can create all of these things as long as you have a group of people willing to support it. Whats even crazier is that it doesnt even need to be a huge community, just a few hundred people, an AMM pool, and an asset is born.
Steve Chen: I have three months of experience in Web3. Although I am still a novice, 15 years ago, when we started to create things like YouTube, we talked about the democratization of content, the democratization of content creativity, and the democratization of content distribution. Anyone who has talent, whether you have Hollywood connections or whether you can access distribution networks, as long as you have good content, you can upload it to YouTube, and the content is completely democratized. The audience will watch it themselves, and if they like your content, they will share it with more people.
Meow: You just said something very interesting. You mentioned that the value of YouTube is not created by you, but by the users.
Steve Chen: Its really interesting, and I say this without any modesty, if you put yourself in my position, youll find that the well-known content creators who have millions of subscribers on YouTube, they have their own channels and content. These are their full-time jobs, just creating content.
Meow: Work is an expression of passion, and full-time work is part of life.
Steve Chen: Yes, we should be grateful to these creators. They may feel that without YouTube, they cannot pursue their passion for content creation and make money from it. But the reverse is also true. Without these content creators, YouTube is just a bunch of servers. No one will go to that domain because these creators continue to renew their subscribers and provide more and more content, which creates value. There are also third parties and advertisers who actually pay for this content. Without this ecosystem, YouTube cannot continue to operate.
Meow: Thats really interesting because youre obviously one of the pioneers of UGC (user-generated content). And in crypto, I call it UGM (user-generated currency). In user-generated content, the value comes from the user. Similarly, in blockchain or cryptocurrency, the value is created by the user. We went from an era where big studios created content and they profited from the content. And what you did was democratize that process and give users the opportunity to incentivize themselves to create content, promote content, and get value from it.
If you are Netflix, you not only have to create content, but you also have to promote ads yourself, and this is true globally. No matter where you are in the world, you will see Netflix ads, which is crazy. But when we discuss these things, the real core is that users promote their content themselves. Similarly, in the crypto world, users are also creating currencies, promoting currencies, and deriving value from them.
Of course, there are some nuances to this, which Ill get to in a bit, but overall, I think this is very fascinating because were at the next step in the evolution of UGC and UGM.
Steve Chen: I think it depends on who the audience is. If they were there, there werent a lot of people using YouTube in 2000, or even 2005. At the time, you said you were democratizing content, which would have been a great slogan. But when you actually compare what you see on subscription cable networks, satellite TV, HBO channels, you feel that user-generated content cant reach that level.
Because back then, these contents were two to four minute videos, and even iPhones didn’t exist yet, and users just filmed, edited, uploaded, and shared these videos. But now, there are actually entire teams behind these contents. In 2024, you really see user-generated content (UGC).
I think as this democratized idea spreads, talent from all over the world will be able to participate, and you dont need to live in Hollywood to make this content. I think thats what attracts me to the Web3 world, although as you mentioned, there are still many pitfalls and problems along the way. Its not perfect, its not as simple as going to a bank to open an account, because the banking industry has been operating for hundreds of years. We are now at the beginning of the world of user-generated content, and we will see it catch up.
Meow: It will catch up, and that’s how all democratization happens when you make things easy and fun, even reading. I bet someone is like, “Oh, are you sure you want to let those commoners read?” I’m sure that’s the case with writing right now. What if they start reading and have these ideas?
When you enable people to publish their own stuff, when you enable all kinds of people to do things, the world becomes a much more chaotic place. Theres more chaos in terms of what content is produced or how to make money, and theres more, like, Samsung webinars, but I think its all part of making it easier to create.
Think about those big studios you just mentioned, who printed money in the past? In the past, only the government could print money, but now anyone can start creating currency. As long as you can create something, and the technical threshold is very low, you can get enough support behind it, such as those tokens worth billions.
Back in the early days of user-generated content, you really needed something like Bitcoin or DeFi. But now, you don’t even need those things, you just need an idea, which is kind of crazy.
Steve Chen: I think it keeps refreshing my memory because I think there are still a lot of obstacles that we havent encountered in the user-generated content world. For example, in order for content creators and market makers to really turn the market into an actual market, you need to start making money. And to make money, you first need to solve something that no one is used to before.
There was a billion-dollar lawsuit that Viacom sued YouTube because someone uploaded a Comedy Central video. You also have to deal with Universal Music, EMI, Sony BMG, because people didnt know they didnt have the distribution rights to certain CDs and put them in videos. I think these are just some of the obstacles that content creation encounters when it makes the generational leap.
Pajamas is your ticket to Web3
Meow: Its amazing because all of this is for work, and every time theres a big development, theres always this inevitable conflict between the old ideas and the new ideas. Take you, when YouTube first started, all this content was produced by these big studios, and then people uploaded it. The Web3 world is very similar, like Pajamas.
Steve Chen: Yeah, Pajamas is my ticket to the Web3 world. Pajamas means two things to me. One is that it’s the name of a meme token and it’s also the name of a cat I have. On the other hand, it’s the first cat video uploaded to YouTube, and it’s the 15th anniversary of that upload.
Pajamas in Steve Chens first YouTube video
And most importantly, I’ve been invited to speak at cat conferences all over the world because this video created a huge community of pet lovers who have been uploading videos and paying homage to this first cat video, even if it wasn’t a very good cat video.
Then one day people started talking about Pajamas on Twitter, and also mentioned things about Web3 and the meme space, which got me interested. Although I am not the actual creator of the token, this cat that I uploaded 15 years ago is the reason I got into this space.
Meow: We live in a world where anyone can tokenize an idea, there is no such thing as permission. Just like there are countless Trump tokens, you dont need any special permission. The tokenized world is like this, no one entity has complete control over an idea. So, for Pajamas, your cat was the OG cat 15 years ago. I am fascinated by this story. Someone created a token, and then a CTO or a community pushed behind it, and you had no involvement at all, and they didnt need your involvement.
Steve Chen: This is something that I learned about after I joined. But for me, its just a fun thing named after my cat. And what a great way to learn something new through something thats named after my cat.
Meow: I love that you found something that made sense to you. Its a way to learn that a lot of people dont take the initiative enough to understand. You approached this with an open mind and a modern mindset, and I feel like you learned a lot from it.
Steve Chen: Even so, I still had to go online and watch videos in the middle of the night to convince people. Because in the Web3 field, I learned that there is a lot of distrust. When I said, I am Steve Chen, the co-founder of YouTube, and I want to know the story behind the Pajamas token, no one believed me. No one thought that the founder of YouTube would be interested in this.
When I responded on Twitter, my account wasnt verified yet, so they thought I was just one of many impostors. Once I got into this space, I started to think seriously, and from my perspective, in the early days of YouTube, I didnt just see it as an amateur video site, I thought it had the potential to change the way people consume and create media on a global scale. I did see that, and I just wanted to understand it more deeply.
Bitcoin and meme coins are both user-generated currencies
Meow: Bro, youve democratized video content, and now its monetization. Youve got to do it, I mean it. Youve played a big role in YouTube, anyway. I think youre right, were really in the very early stages of user-generated content and user-generated marketplaces.
Steve Chen: Interestingly, the reason I met Chad, the co-founder of YouTube, was because I first moved to Silicon Valley in 1999 and joined another startup, which was called Paypal. Even at that time, Paypal was trying to democratize your wallet and democratize the way you pay back your friends. But I feel that this is a leap compared to todays Web3. All of these things are forming a full circle, which has always been an area of interest to me.
Meow: When something first starts happening, people often don’t see its potential, and they often judge that it’s impossible to catch up to the current level. Let me give you two examples now. Recently, on Instagram and YouTube, there have been a lot of short videos, and the quality is very good. Someone said in the comments, This SNL stuff is so bad now, the budget has been cut, you should take over the show. I think this is really interesting. The quality of these short video creators is much better than SNL, more culturally relevant, more interesting, more influential, and has more views.
Steve Chen: This is democratization, and ultimately it will all come down to views and audience votes, and that will all come down to who’s watching.
Meow: What you mentioned is very important and should resonate with the audience. Imagine going back to the early days of cryptocurrency. To me, I think cryptocurrency is a category of user-generated currency (UGM). I think whether it is Bitcoin or meme coins, they can be considered user-generated currencies because they are not generated by the government.
Some people might say that fiat currencies are better than Bitcoin. But I dont think thats how it works, lets look at two examples. Lets say we compare the US dollar and Bitcoin. Obviously, the US dollar has a longer circulation history, and you could say that the US dollar has a stronger monetary acceleration effect. Lets look at the Zimbabwean dollar or the North Korean won. Would you rather hold the Zimbabwean dollar, the North Korean won, or Bitcoin? Obviously Bitcoin, and the same is true in many turbulent environments.
So, whether its fiat or Bitcoin or other asset classes like gold, they all fall into the category of money. Theres a more liberal perspective on how to look at them. So, thats how I think we can appreciate Hollywood content, and we can also appreciate a random video made by someone. If you can appreciate all the content out there, then we can also come up with other forms of money. But in a way, money is more confusing than content. Money is not money, its something else. So how do you think about this issue?
The use case of cryptocurrency is to create new types of money
Steve Chen: I agree with you because in some ways, when I left PayPal, we had already achieved the end goal. I think the technology and the product itself did have real utility. But even if you create a payment service like PayPal, you still need to give people a reason to adopt it. For PayPal, the reason was eBay.
Steve works as a programmer at Paypal. Image source: emigrantslife
Back in 1999, 2000, when you won an auction on eBay, you still mailed a paper check. Forget about dollars. You had to go to your bank account and withdraw money, then mail the check. A week later, you received the check, and someone cashed the check, and the transaction was completed. So at least this service makes the payment process faster.
But it didnt solve all the problems, there were still a lot of variables that werent resolved, a lot of conflicts and challenges. But we solved one problem, which was the massive popularization of PayPal as a payment service through the eBay platform.
I think whats interesting about YouTube is that it really takes the pure entertainment value of media content and democratizes it. Anyone can use the same upload button. What YouTube has shown over the last 15 to 20 years is that before you might have watched a show on cable TV, and even if you had an idea you wanted to do, you needed to know the right people and go through a ton of hoops to get to the point where you could get on TV. Now you can click the upload button and within five minutes have the world see your talent.
So I think thats whats great about it. Even if were talking about just access to a device, access to an upload button, and access to a channel, thats been democratized. Now it all comes down to the pure talent of the individual. Thats a bright spot for me in the Web3 world: where can we push this thing further? I think there will still be roadblocks and bumps along the way.
Meow: I think this has a strong similarity to the UGC and UGM I mentioned earlier. Before, if you wanted to create currency, you needed to raise an army, conquer territory, or convince everyone that this was the best currency. Like Genghis Khan did a lot of hard things to create currency. Or you needed to become a country and create a rare resource. The funny thing is, if there really was a Golden Goose, gold would become worthless. Sorry, Im a little off topic, but I think this is a very interesting analogy.
Steve Chen: You bring up a good point because I think PayPal kind of hit a point where it crossed the finish line in terms of payment services, but it was still limited to the U.S. dollar. Still, there were a lot of extra steps that we took to create PayPal.
Meow: I like the idea of meme coins, like Dogecoin. It really takes a lot of effort, it takes years to build infrastructure, build a team, create a community, set up those centers of attraction, all of which require a lot of work to get to this point. But meme coins are different. You have an idea, and if enough people resonate with the idea and there is enough power to support it, it has the potential to become a currency.
I honestly think that this democratization of money creation is mind-boggling. A lot of people say theres no use case for crypto, but I think the use case for crypto is pretty clear. The use case for crypto is to create new types of money. Its always been that way, whether its Bitcoin, Ethereum, or meme coins, theyre all essentially creating new types of money, new types of money. Everything weve seen, whether its the ability to transfer money, or new things in the industry, is a derivative of that ability. Because crypto has the ability to create new types of money, then we build everything on top of it.
The current Web3 atmosphere is like Silicon Valley
There is enough curiosity, but also trust
Steve Chen: From a target market perspective, I think one of the biggest hurdles is still getting people to trust and adopt the platform and really embrace it.
Meow: Welcome aboard, its really about trust. We can talk about it, you can show everything you want, but it doesnt matter, the key is trust.
Steve Chen: Yeah, because I think, people who are in the Web3 world right now, you are all early adopters.
Meow: No, we are not. I mean this space has been around for a long time, we are just beginning to understand the potential of user-generated currencies (UGM).
Steve Chen: The platform has shown whats possible, but its still like going back to the early days of YouTube. You know you can upload a video, you know you can watch it, and the technology is there. But getting people to actually spend an hour, two hours of their time creating content or watching content on this platform is a whole new thing, especially when you start to attract a large audience.
From my experience over the last two or three months, I like to think about this from the perspective of a potential user or consumer. How do you get people who havent used this technology yet to adopt it? How do you make them feel like they trust this technology?
Meow: My answer is that crypto offers a great direction to work towards. What I like about the crypto industry is that we all share a common goal, and I really dont see that in any other industry. We are an industry made up of people who are all very interested.
Imagine when viewers see me and you talking, they say, Wow, the founder of YouTube is talking to Meow. And youre also a founder. Were talking about the early days of user-generated content (UGC) and how that reflects user-generated currency (UGM). I think its wonderful for people to see that.
I told you before that I think cryptocurrency is inevitable because its like a two-by-two grid across the globe and across the entire technology stack. Across the globe, across the entire technology stack. There are people in every area of the technology stack, from marketing, finance, education, content, to regulation, who are driving this. These people have extremely strong incentives and they are very passionate.
When you have a lot of people who are ideologically aligned, financially aligned, and because we have real social networks now, these people are also socially connected, forming very solid social networks. Our entire reputation is built on this space. So its all growing. The growth of crypto right now is because we are moving forward as a whole. I dont see anything like that happening in other industries.
Steve Chen: I think 2024 is really the right time to enter this market, because I think there is a lot of curiosity about this field now. For me, as a practitioner in the Web 2.0 field in Silicon Valley for 15 years, I have seen what technology and the Internet can achieve, and it has proven to be successful in many ways.
Many of the internet and mobile applications we take for granted today were developed before some young people were born. A whole generation has grown up with this technology. But in the area of Web 3.0, I still think it is the next big change. It will take a similar entrepreneurial spirit, innovative ideas, ICO solutions and startups to combine the two.
Combining these elements will create something far greater than the sum of its parts. I am very excited to meet you because I think we need to build more bridges to attract those who are interested in Web 3.0 but don’t understand the market, and those who are already in the Web 3.0 field can also benefit from it and solve the problems they encounter through collaboration.
Meow: Can we stop looking at the world as separate? I think we are promoting democratization, and the kind of currency democratization we are talking about now is impossible without a deeper democratization of content. We all participated in that crazy explosion, such as the rise of Facebook, Twitter, and even instant messaging tools. Before these applications appeared, group chat was not a real concept. But now the entire industry almost relies on group chat, such as Telegram, WeChat, Twitter, which have become the foundation of the industry.
In a way, weve reached a point where mainstream adoption is imminent. To me, I feel like its probably three or four years away from mainstream adoption. I could be wrong, but I do feel a deep instinct and interest. What do you think about that?
Steve Chen: First comes curiosity, then trust. I think for many people, first of all, its about whether this is something worth my curiosity, and then whether to invest in it. I think its more of a community thing than an individual thing. And early pioneers will inspire others to join, see that this technology has been verified, and be able to move it forward.
It may sound silly, but I still use my family, especially my mother, as a gauge for whether to accept a new technology. When I talk to them about food delivery services, Amazon, YouTube, instant messaging, etc., they understand and accept it very quickly. But when I want to talk to them about changing the way they do daily transactions, it is difficult to convince them that there is another alternative based on new technology.
For me, its like the atmosphere in Silicon Valley: being surrounded by entrepreneurs and potential investors who are interested in technology and willing to take risks to see if new technologies can solve these problems. Thats why Im interested in joining the Pajamas community and want to communicate and collaborate with you.
Meow: Im also very interested in your story of joining us. Let me ask you a question, how did you initially start to believe in this thing? Why didnt you think it was a scam, but instead became curious and invested in it?
Steve Chen: Thats a good question. Ive always been more willing to take the riskier route because I think only through this route can I seize opportunities, and Web3 gives me a chance to explore possibilities. When I started to get interested in the Pajamas project, I felt that it was really changing the way the entire ecosystem operates. This experience allowed me to meet a large number of people who have similar social networks as me.
Crypto community is more fragmented than Silicon Valley
Meow: Its incredible that we know so many common friends, which also shows that our circle is very small. I admire you very much. You didnt enter this industry with the mentality of I want to build the next trillion-dollar startup or I want to be an industry guru, but joined the Pajamas project as a community member with an open attitude to learn and explore. Many people in our community really appreciate your attitude.
Steve Chen: Indeed, it is a very different world, and many people may ask, why not start a token project yourself, but spend so much time participating in it as a community member? For me, this is the first time since YouTube that I have been so interested in a project. In the past three months, I have invested a lot of time in the Pajamas project, often working until three or four in the morning before realizing that it is time to rest.
Meow: What exactly do you find interesting? Because I find it interesting myself, but its hard to describe that kind of fun, so Im curious about what you find interesting.
Steve Chen: I would compare this joy to the success of YouTube. YouTube allows creative people to use their creativity to reach an audience and even monetize and build careers with that creativity. When you go to give a speech to fifth graders, the best thing is to see them applaud enthusiastically and express their desire to become YouTubers when they grow up. This experience allows you to do something you love and make a career out of it, rather than following a career path that is predetermined for you.
In a way, I see something similar in the pajamas community. When I was in the Telegram group, I had no idea where these people were from, but the core reason we came together was a shared passion for pajamas. Then you realize that these people are actually more decentralized than we previously thought. I thought Silicon Valley was decentralized enough, but in fact, this community has members from all over the world, in every time zone. And thats exactly what you said, its much more advanced than anything Ive seen among the billions of users in Web2.
Meow: I often see and participate in things like reaching millions of users through a group chat. We know the tight relationships in Silicon Valley, and trust plays a key role in it. This trust is built on years of experience and the reputation of institutions, such as companies like Sequoia, who have established a certain level of trust and signaling, which can sometimes be abused by individuals.
For the purposes of this conversation, though, lets focus on the positives. I think Silicon Valley was able to succeed because it had a very tight network of people that were connected through private parties, social networks, etc., and that model is similarly reflected in crypto. The difference is, however, that the network in crypto is global, not concentrated in one region like in Silicon Valley. I really like this because I think crypto has truly democratized access to funding and expertise.
Steve Chen: I agree with you, and thats actually our ultimate goal. I think in this process, even in the past three months of the journey, its not all positive, but I take these negative experiences as learning opportunities. Its like the experience during the YouTube period, not only those successful Silicon Valley startups, but also those failed projects, such as when we acquired Delicious from Yahoo, we thought we could reactivate this social bookmarking service, but it didnt work out in the end.
However, I am still very grateful for that experience because it made me realize the gap between the imagined results and the actual results. One of the greatest contributions of the pajamas team was to give me such learning opportunities, not only when the market is rising, but also when the market is falling. This experience made me understand that no matter what you do, the market cannot always go up.
Value creation is not always smooth sailing
Meow: One point I often hear is that the true value and personality of a community is formed in market downturns, not in market booms. Every time the market crashes, many people will question whether it is a scam, but those that survive are stronger each time. And it is in these troughs that a new generation of participants is formed because they will realize that they missed something and will not make the same mistake again next time.
I think thats how we were able to convince everyone in the end, and thats why UGM will win in the end. Every time someone says, I was wrong, this thing isnt that fake, were one step closer to winning.
Steve Chen: I totally agree that the development of Silicon Valley has not always been smooth sailing along the way. There are always ups and downs.
Meow: People tend to get so fascinated by this crazy idea that the value is just like this, like a success story. Its not, the value is 90 to 99% failure. And thats why Im so optimistic, because people tend to only look at the failures and say, this is a scam. But if you look at the successful creative ecosystem, theyre constantly trying and recycling. As long as you fail in the right way, its fine, simple.
You and I both know who are the best people in startups? The ones who dont succeed. Theyre the best because they have a lot of experience and talent, and theyre humble enough. I mean, how do you find a new mentor, how do you let a newbie fail? You cant do that, just like in the cryptocurrency world, as long as someone fails in the right way, you can say he did all the right things.
I feel like the cryptocurrency industry is like a global phenomenon, and to me it really is a reflection of global value because you really feel the same dynamics and energy.
Steve Chen: This is what I see happening. While Silicon Valley shines in the spotlight, I feel a whole new level of engagement when I talk to people on Telegram who are truly committed to the crypto community. In these Telegram conversations, the first sentence is usually What time is it? because people are from all over the world. This is very cool, and I think as long as this passion is there, these problems and obstacles will definitely be overcome.
Meow: This reminds me of another example of a good product. One of the important reasons why Silicon Valley is successful is that it attracts the best talents from all over the world. Why do they come to Silicon Valley? Because there are opportunities, talents, networks, and funds here. In the crypto field, the threshold is much lower. There is no O1 visa or H1 visa. All you need is a Telegram group chat. Jupiter, which I lead, is now one of the largest teams in the crypto field.
Steve Chen: Im always thinking about how to continue to expand this space. Like, how do I get 10 of my friends to join? How do I get them to bring 10 more people? Thats what keeps me up at night, because I think all the right ingredients are there, and its just a matter of finding a solution.
Meow: What if I said there would be thousands of solutions, and everyone would solve the problem in their own way?
Steve Chen: Of course, I think there will be problems and challenges at every level, but it has been proven to be feasible.
Meow: I recently went to Ecuador in South America, where I performed a service that required a $300 prepayment to the service provider. You cant imagine, trying to pay the various fees through Western Union was a nightmare. I tried to swipe my credit card directly, but the fees were ridiculous and almost impossible to complete. Even so, there was a huge distrust of cryptocurrency at that company, but for me, cryptocurrency can completely solve this problem.
Steve Chen: So, I want to ask, why hasnt it solved these problems yet?
Meow: Its about trust, infrastructure, liquidity, and social issues. Like, does anyone trust the system? If their friends dont trust it, then they wont trust it either. Then theres the liquidity issue, is there enough liquidity from A to B? Theres also the transfer issue, and the acceptance issue. These are all problems. But once I show them how to do it, they think its great. However, the exchange rate is still very expensive. So this is why stablecoins are so powerful.
Although they understand this, they may not know what a stablecoin is, which is why I feel there are a lot of things that need to be solved. I realized that it is almost impossible to solve these problems. You need a local team to really accept and drive these changes. You need people who speak the local language to drive these changes. I can promote and encourage this, but ultimately it is not my task.
Steve Chen: I think its still important to talk about where you live. My family and I moved to Taiwan in 2019. The original plan was to stay for a year, but the pandemic came and the schools in Taiwan handled it very well, so we decided to stay in Taiwan, and its been five years now. I found a lot of untapped potential in technology in Taiwan, especially in the field of semiconductors. And, Ive been thinking about how to globalize the resources of Silicon Valley and bring it to the world.
Meow: The entire content and style of Silicon Valley is a very long topic. What are the main gains you got from it?
Steve Chen: The main takeaway I see is that cryptocurrencies create a huge foundation in terms of currency and financial transactions. The technology has been proven to work, and I sometimes even trust it more than some central banks because I can see the source code and algorithms behind it. I think the technology has been proven to work, and the key is how to make it more accessible to consumers.
The most fun part for me was documenting it, especially the issues mentioned earlier, such as the fraud I encountered. By experiencing these issues firsthand, I was able to better understand the difficulties that new users and new technology adopters might face, which led to a better experience.
Compared to starting a business in Web3, joining the meme community is more interesting
There is no “real token”
Meow: Any token launched now will have 5 fake versions. So what is the real one? For example, the next day there is GOG, or other similar names. Although there may be only one GOG, it does not mean that other similar names are fake. You can say that there is only one ABC letters or only one Facebook.
In the long-term development of decentralization and centralization, companies such as ByteDance are still the center of determining the rules. Take Binance as an example. There were many problems in cash transactions before. Centralized exchanges have the power to deal with these problems and can decide which are regular tokens and which are fake tokens. In the decentralized world, because there is no real centralized organization, it is particularly important to define the real token.
Steve Chen: Actually, this has already happened successfully. When I was growing up, we only trusted proprietary software and hardware, but now we see the emergence of open source. If you start to disclose the code and details behind the hardware and software design, although there are some caveats and compromises, everyone can see the source code and algorithms, so that every transaction can be publicly reviewed, increasing the transparency of the network.
Meow: In theory, in cryptocurrency, due to the lack of identity, one person can create thousands of virtual wallets and conduct a large number of transactions, which is called the water army problem. In this case, anyone can pretend to be a successful project with thousands of holders, but in fact it may be just a robot. Someone has created robots to generate a large number of accounts and conduct various operations.
Steve Chen: I think these are the problems that any new technology will inevitably encounter in the process of adoption. As we have seen in Web1 and Web2, solving these problems will ultimately benefit the world. As entrepreneurs, we need to identify problems, optimize daily needs, and come up with solutions. If you can solve these problems, you will get greater adoption and ultimately convince more people to use this new technology.
Im still in this space because I think there are still a lot of problems that need to be solved. Its not like everything is solved and we can walk away. We need to keep working on it and find solutions.
Meow: I like this optimistic view of technology and evolution. Although things will become extinct in technological evolution, we can find a path to improvement by trying new things, identifying problems and proposing real solutions. I believe that cryptocurrency will also go through this evolution, screening out the best participants and optimizing technology and systems.
Steve Chen: This is part of evolution. Things do go extinct in the evolutionary process, but trying new things, identifying problems and coming up with solutions is the reason we move forward. I cant guarantee that all solutions will be successful, but I personally believe in it.
Meow: I personally love your foray into the UGM (user generated media) space as a pioneer in UGC (user generated content). What are your thoughts? What are your plans?
Steve Chen: Honestly, it is a privilege for me to have the opportunity to meet and discuss with the core people at the forefront of the UGM field like this afternoon. Many people talk about how precious it is to communicate with you. I think this kind of communication is the peak of my entry into this field. Although I am still new in this field, I can bring the experience learned from the Web2 world, although these experiences may not be completely applicable, but still have certain value.
Meow: I think it makes a lot of sense, and our discussion feels like there are a lot of similarities. I’m really excited about the future of UGM and UGC, life has indeed become very crazy. I don’t know how to deal with these changes, but I’m excited for the future.
Steve Chen: It’s important to keep an open mind, stay curious about new things, meet more people like you, and see if there are opportunities where I can play a role in this new area, just like I did in Web2.
What does “CTO” mean in the Meme World?
Meow: What do you find interesting about being a member of the community? In startups, people usually join the company for salary and equity. The equity is provided by the company, the roles are clear, and it is a centralized incentive alignment. In the UGM space, the situation is completely different. People spend a lot of time and energy on it, and although they may get a financial reward in the end, it may not be clear. How do you think this incentive method works in the community?
Steve Chen: Thats a great question because Im trying to figure this out as well. Im amazed at how driven and passionate the community is, how many talented people are contributing so much time in their roles as if this is their startup, no matter where in the world they are. When we get together to discuss, even if everyone remains anonymous, you can feel the passion and the amount of work thats being put in. Its amazing because you find people from all over the world coming together around a common goal.
Meow: And this goal is very interesting because it is just an idea or a symbol. Singapores incentives are like this pure idea or symbol. Its amazing that an idea or a symbol alone is enough to align people. Do you find this interesting?
Steve Chen: Yeah, I dont think its that different from my experience as YouTube CTO. I acknowledge every day that you, with over 20 years of experience as a system architect on projects, dealing with data center scaling, etc., you have much more experience than I do. If you have ideas about how to scale YouTubes backend more efficiently, Ill listen to you.
In the online community discussions, I feel that I can provide my own feedback, but at the same time there are many people who are more experienced than me in this area, and their enthusiasm and experience make me benefit a lot. This kind of mutual exchange is similar to my experience in the Web2 era.
Meow: I find there is a big talent distribution gap. Ive been involved in a lot of discussions lately, and its amazing how the CTO position means different things in different contexts. In a community-driven environment, the CTO role is different than in a traditional YouTube or other company.
Steve Chen: CTO usually refers to Chief Technology Officer. In a community-led environment, the role of the CTO is different and may involve more management and support of the community.
Meow: Could you please explain the specific role of the CTO in the community?
Steve Chen: In a community-led environment, the founders and the original team may have long since left, and community members have taken over the management of the project. They have enough faith and commitment to the token and work together to fill the gap left by the founders. This community takeover approach has given me a great learning experience.
Meow: The experience of being a founder and being a community member is very different. If you are a founder, you control all decisions and resources, but as a community member, your role is completely different.
Steve Chen: This experience is part of the learning process. Different from traditional founder-driven companies, community-led projects present another model of collaboration and development.
Meow: It is indeed a big difference to go from a highly structured and founder-driven environment to this decentralized community environment. Traditional companies tend to emphasize the value of founders or institutions, while community-led projects focus more on individual and collective enthusiasm.
Steve Chen: Yes, traditional companies focus on meetings, schedules, and organizational structures, while in the community, the real value lies in the enthusiasm and participation of each member. It is an obvious fact that you cant buy enthusiasm with money.
Meow: Yes, people can feel the sincerity. The sincerity and passion in the community cannot be bought with money. You can only experience this feeling through real participation and investment.
Steve Chen: Even downloading an app or using a communication tool like Telegram has taught me a lot. Although I use Telegram quite frequently now, it wasn’t on my computer a few months ago. Even so, I kept an open mind and was willing to communicate with new people, which paid off after some missteps.
Attention and capital are spinning fast
Meow: It is true that the democratization of finance has made transfers more convenient, but it has also brought many new challenges and risks. For new users, there are many traps and problems, which makes people feel uneasy.
Steve Chen: In a way, being able to easily transfer $100,000 to someone is more convenient than ever before. However, it also means that we need to be aware of it and face it head on. I think when something like this happens, I will immediately inform the community, the Pajamas team, and even my Twitter followers about these issues. I dont want to hide or keep it secret, but to be public so that we can find solutions together with the community.
Meow: It’s been helpful talking to you because I’ve been going through this myself lately. Things like creating a wallet, figuring out the contract address, etc. are no longer a problem for me. But if I go back to the beginning, these were all very daunting things.
Steve Chen: But actually, even this afternoons experience was valuable. None of this would have happened if we hadnt built some foundation of trust between us. It was a valuable experience that we were able to trust each other and be willing to take minimal risk to get the reward.
Meow: I think this is great advice for anyone who wants to get into this space, whether its a trader, investor, or leader. Be optimistic, but also be cautious. When entering any situation, be prepared for the worst, but also be cautious. Being too cautious may lead to missing opportunities, but being completely careless may lead to failure quickly.
As adults, we have experienced many potential dangers, such as falling off a cliff and being scalded by scalding water. We survived, and society and our parents have built enough protection for us. We gradually learn what is dangerous and what is safe. Society is like a child who has just started to learn the rules. We are also constantly learning and adapting in this new UGM world.
Steve Chen: Even though you are still active and are considered an iconic figure, you continue to come up with innovative approaches and solutions, which shows your commitment. Even though you may not be the one who came up with all the solutions, your belief in long-term solutions shows that you have not given up. This is similar to me. I am not 100% sure that what I am doing is right, but I am willing to invest time, which shows that I believe there is value in it and I am willing to keep working on it.
Meow: I love this perspective. People really appreciate that you didn’t come into this space with a domineering attitude. Instead of showing off your tokens or claiming to be an expert, you approached this space as a learner. Every time I thought I knew something, I was actually wrong.
Like other fast-moving industries, cryptocurrency is the only industry that changes almost every few weeks. For example, a coin goes up because Trump was assassinated, and then goes down because Biden announced that he would not run again. These phenomena completely subvert our understanding because these coins have no direct relationship with Biden or Trump, but they will have huge fluctuations due to these events.
Steve Chen: Ultimately the market will determine the truth, and market prices are the key to determining whether a theory is correct. Therefore, some founders may think they have all the answers and try to adjust according to their own vision, while other founders are more adaptable and humble, willing to listen to opinions, and ready to admit that they may be completely wrong. This humble attitude is very important in this field.
Meow: This industry humbles you very quickly. Whether you are a trader, investor, builder, or speculator, you need to build a foundation of humility because this space changes very quickly. A few months ago, someone released a token address and raised tens of millions of dollars. This phenomenon reflects the extremely fast rotation of capital and attention. The markets attention to certain tokens changes very quickly, and often overnight, you will see capital flow to new popular tokens.
Steve Chen: For me, it is really valuable to be able to communicate with people like you and understand how you turn ideas into practical solutions. I want to hear about the difficulties and mistakes you encountered in the process, because these experiences are equally important to us.
PPP truly brings applications to market
Meow: I am amazed by the explosive growth of tokens. It was difficult to get a significant valuation before, but now every day there are tokens that soar and then quickly crash. The speed of this capital and attention rotation is extremely fast. Every day there are new creators who gain attention and then disappear quickly. The dynamics of this industry are incredible.
Steve Chen: We are now having this conversation from a Silicon Valley perspective, and while there is a lot of interest in the technology side, ultimately it’s about consumer adoption, how do you actually get these applications to market. It’s important to be able to talk about my interest in this space and see the potential in this space in my personal network. I hope to be able to better explain why I can attract more partners, especially those I’ve known over the past decade of experience, to join this space.
Meow: Can I give you a really outrageous suggestion? I think what you should do is to get more people who are already interested to join you, and then let your friends in Silicon Valley see how happy you are, and they will naturally follow you. Instead of convincing others, it is more fun to just take action. I like your point of view on the connection between UGC and UGM. You are not speaking from a technical perspective, nor from a traders perspective.
If you approach this from a technology perspective or a transactional perspective, you might be missing the point. Imagine if you look at content from a server perspective, it’s bandwidth and data first, but that’s not the essence of it. Similarly, the essence of this current movement is not technology, but people’s deep desire to create assets, be part of a symbol, and move forward.
So I think its important to go into this space not from a technology perspective, but from a community perspective. Everyone is trying to create the next blockchain or something scalable, trying to figure out how to make the next breakthrough. But these are just the surface, starting from the core drivers of growth, from driving the deeper drivers, this is the key. Thats why I think you start from a community perspective is the perfect starting point, because the community is where the value is created.
Steve Chen: To some extent, I think the technology has reached a certain maturity, so I entered this field because I believe that now is the best time to think about how to apply technology to actual services. The value of technology itself is one aspect, but the real value will be revealed when technology is adopted as the engine behind actual services.
Meow: Just like YouTube, initially we limited it to dating videos because the technical infrastructure was not mature enough, but then we decided to open up the platform. Even though we were competing with Google Video at the time, we never expected that 20 years later my kids would be using it and it would be the most popular app.
Steve Chen: So the key to YouTubes success in the early days was whether you could get enough bandwidth, and the challenge afterwards was to find the right ideas to use these resources. UGC was possible because the technical infrastructure was mature, and the same is true for UGM. Although now we are talking about how to democratize the right to create money, in essence, it is very similar to the situation of creating videos.
Meow: How do your kids feel about watching YouTube? Im curious, what did you think?
Steve Chen: Sometimes its a mixed feeling. Because when Im telling them to go to bed and put down their dads phone, its a mixed feeling. Im thinking, Thank you for using this, but can you please put it down? Although I think its a bit contradictory, its true.
Meow: It feels like the users who use it.
Steve Chen: Its crazy how fast its grown. Nothing else in the past 15 years, other than creating YouTube, has excited me as much as interacting with you guys. I really enjoy being part of the community now.
Meow: One day you might say, Hey, why dont you just let them send you money? Not USD, but the money that dad makes, or you could ask, What is the money that you create? Im serious, in the future everyone will have their own currency. Were going to have billions of currencies. Everyone can create a currency, and some currencies are more valuable than others, and were heading towards a world with billions of chains and tokens.
Steve Chen: I think the similarity is that, although it is new technically, the ability to transform from an idea into widespread global acceptance is at the core of what drives everything.
Meow: This drive is really important. Its important for me to think in the mindset of a student and advocate and be as useful to the community as possible. This mindset is healthy because in this industry, there is a lot of competition and abstraction. I will find my role in the ecosystem, which I call PPP, similar to PVP games.
PVP is adversarial, you choose other people. I think you can look at cryptocurrencies in a PPP way, that is, focusing on how to perform in a long-term framework. The last player in PVP loses, while in the context of PPP, the last player wins. My mission is to participate in the game, but if it is a PPP game, it is infinite because the last player is always the winner.
Cryptocurrency is a garden. If you have the right resources, like soil and sunlight, you can create something beautiful out of it. I feel like thats the direction we can go right now. We can take all the raw soil, sunlight, and resources and turn it into a beautiful garden. To me, its an amazing thing how we can turn bits and bytes, and human energy, into something beautiful.
