Interview: XinGPT
Guests: Yan Xin, Sign
Xingpt:
Sign social network is very popular recently, everyone is browsing some of Sign's avatars and various related content. I want to ask, how did you design this? Why do you allow everyone to participate in these games on social networks? I feel that this kind of gameplay is actually quite rare.
Yan Xin@Sign
To be honest, we have discussed this among ourselves. I started to realize last year that it is difficult to make VC coins. Even if you have a very successful product that can make money, then you are a good business, but why do you want to issue coins? I think that many coins actually rely on the traffic brought by airdrops, but after the airdrops, they are gone.
In fact, I think last year had a big impact on me. The market was very bearish last year, and everyone was struggling. We were always raising funds. For example, since I started my business, I have been working on products while trying to get VC recognition. But objectively speaking, if you want to launch a successful coin, the most important thing is not VC recognition. VC recognition is no longer accepted by retail investors, right? VC was originally meant to lead retail investors, but now retail investors no longer recognize VC. If you chase VC every day and still can't catch up, then it will be very difficult. So later I realized that building a community is the most important thing, so I have been studying how to build a community since last year.
In fact, everything we do now is not just for the hype of TGE. We started to build a community at the end of last year. At that time, there was no TGE, but we used our own ideas to build a to C community. Building a community is very different from building a VC coin. You can't just talk about the product, right?
You can’t talk about features too much, because you don’t want to show people just one feature. People are interested in you not because of how awesome your features are, or how good your product is, but because they like your vision, your vibe, and your culture. So we put a lot of thought into this.
We actually started doing this in Singapore last year at 2049. We held a party at 2049, and our sunglasses had physical products at that time. We actually started doing this in Korea last year, and we have been building it consistently till now.
Xingpt:
I think there is another problem. You are actually a to B product. Nowadays, to C products may not be used by players. For example, meme and gamefi are more to C. You were originally to B, including the token table. So how to let the C end know what a to B product is, or how to let them understand or like the project without a usage scenario, may be a very troublesome problem.
Yan Xin@Sign
Yes, I think first, to B and building a good community are two different things. Let me give you a counter-example, for example, SpaceX, a company, actually has nothing to do with retail investors. It is a company that makes launch vehicles, but it does not affect their establishment of a community among retail investors. Retail investors watch their rocket launch videos every day. As long as you make the vision clear and make people feel that it is relevant, that you are solving their problems, or that your business is cool and that you are awesome, people will care about you.
It doesn’t matter whether you are to G, to B, or to C. If your marketing strategy is to say “we are making a moduler, whatever layer, for a certain algorithm problem”, then you are done, and retail investors will definitely feel that it has nothing to do with them.
If we do something, our goal is to make all information verifiable globally, just like blockchain transactions. For example, when a Chinese person applies for a US visa, he or she no longer needs to provide so many certificates, and all information can be directly verified. When Chinese people move to the US, their credit scores don't have to start from scratch. People think these problems are worth solving, and they care about them.
Of course, you are right. Pure to B is still very difficult, so we will also do some to C things this year. In the next few months, we will change our benchmark projects to Worldcoin and Pi. We will launch our own Sign App. We will not build a public chain, but we will build our own super App, and then we can use 30% of the tokens as incentives. This App is actually our distribution channel. Everyone has it. It can be used to store assets. We will put US stocks, services, and our own apps in it. This year, our theme is to G and to C, which means cooperating with 20 countries to make IDs and issue subsistence allowances. We will discuss this kind of cooperation with the country and build sovereign blockchain for them.
As for the community activities, such as online karaoke and online poker tournaments, these are directly to C, and we will include all of these.
Xingpt:
Then I think we can talk about it in retrospect, because we have known each other for a long time. At the beginning, you did this project to benchmark Docu Sign, then you did attestation, and then you did token table, and now you are doing UBI. What is your idea when you are looking for PMF? I think a good point of yours is not to chase hot spots. For example, when Dubai was very popular, you did Docu Sign, and signature things were actually very niche. Later, attestation was not a hot topic at the time. The hot spots at the time were ZK and public chains, and now the hot spot is actually meme. It seems that you have not been chasing the trend. Are you deliberately avoiding it? Or do you stop chasing it if you can't catch up? What is your thinking logic in the process of finding PMF? Do you seek help from outside or are you driven internally?
Yan Xin@Sign
I think there are two points. The first is to pay attention to internal consistency. For example, when we first started ethsign, the team was very inexperienced, and DeFi startups were already very advanced, with high complexity and a lot of money. This kind of product may not work in the long run. Startups raise some money at the beginning and put it in, and once the money is stolen, it’s over; NFT is not suitable for us either. So we chose something unpopular at the time. At that time, we chose something unpopular deliberately because we didn’t have the strength to compete with others.
Later, I paid attention to two things. The first is the consistency within the team . For example, we are actually consistent from ethsign to the token table, because most of the people who sign the agreement are engaged in investment and financing, and there is consistency from signing the agreement to executing the agreement with smart contracts. Second, from ethSign to Sign Protocol, there is also consistency - from signing and verifying the agreement on the chain, to all digital information being signed and verified on the chain . Ethsign is still based on Sign Protocol and has many users. So we are particularly concerned about the consistency within the team. If the internal division is too serious, we will give up all the accumulation in the past and the morale of the team will be unstable.
I also care about what the market needs. For example, regarding the token table, we found in the middle of last year that the unlocking cycle is very long. People want to unlock and sell their tokens. These are the actual needs we observed, and then we did it when we thought we could do it, and then it became an observation of the business market.
It is actually very difficult to follow the hot spots in the crypto, because hot spots usually only last for three months. If you find it is a hot spot and then chase it, it is often too late. Generally speaking, you have to do it first, and then you have a chance when the hot spot comes to you, such as Virtuals, because others are already there. Then, once the hot spot comes, it will take off. If you say Myshell wants to follow this hot spot, it will follow it for a few more months, and when it comes to Binance, it will no longer be a hot spot. So it is difficult for startups to chase the hot spots in the crypto because the time is too short.
Xingpt:
By the time you unlock it, the project is no longer popular.
Yan Xin@Sign
Yes, what we can do now is to be more traditional. We have become a company with revenue, making money every month, and then we work hard in the direction we think is awesome. In the current market, most people don’t believe any stories. No one believes you when you talk about the public chain community, no one believes you when you talk about ZK, and memes have been played out and all the money has been lost.
We can only continue to do what we believe in, which is to expand and strengthen the community and let those who have never used the crypto start using it. So we began to cooperate with the country to expand our territory, rather than pursuing bigger hot spots in the inner circle.
Let’s go back to the question of building a community. The current Marketing stardard is to pair up with those KOLs and let KOLs speak for you. In fact, it is just to grab the popularity in a fixed circle for a while. But you also know that this is not sustainable. KOLs are promoting new coins every week, and people will not always hold on to your coins. They have new coins to sell every week. In fact, the reason why the crypto is not developing well now is because the inner circle is so small. There are full-time people and liquidity, but the money is limited. So it doesn’t work. Pi inspired me a lot, because Pi users only play Pi and don’t touch other coins. So I think I must find my own territory, have my own real user group, install my own Sign App in the user group, and won’t let others touch other coins.
Xingpt:
Yes, I think it is quite interesting. For serious project parties, people may have prejudices when looking at Pi. People with IQ 100 may think that Pi users are all "low IQ". But in fact, as you said, Pi still has a strong ability to occupy the mind. It's just that we may not want to touch other cx issues, but it is indeed very strong in occupying the mind.
Yan Xin@Sign
Yes, let me show you something cool, we did a lot of research - this is a store in South Korea that accepts Pi payments.
Xingpt:
Can it really be paid? Or is it just displayed?
Yan Xin@Sign
In South Korea, merchants need to support Pi payment and pay 220,000 won per year. These are all offline stores, including small supermarkets selling wigs and haircuts.
In fact, Pi is the closest to real digital currency in my mind. You said you issued a coin. I also reflected on it in the past. For example, since entering the circle, the narrative of the crypto has been hijacked by VC. VC has its own theory, saying that your coin has utility tokens and governance tokens, but after so many years, is your utility really worth so much money? How many utilities have you seen? Can gas be worth billions? Governance tokens are even more stupid. The truly awesome coin is community + crypto currency. The bigger the community, the more utilities it will incubate and the governance it will create. It is not determined by the project party. The awesome coin is that you have a huge community. Vitalik just wrote the client himself, and everyone runs this client. Etherscan is not made by Vitalik. The most awesome thing is that you build a community and give everyone the opportunity to participate. You can't just let everyone buy coins, you have to give them the opportunity to contribute and earn tokens, so that everyone can play by themselves. So build a good framework, not just a plate. This is the essence of the coin, not the VC theory.
Xingpt:
Yes, you can’t just buy based on the money you earn or the price.
Yan Xin@Sign
Yes, in fact, this model is not sustainable and may not work. If there is no such model at the beginning, unless there is a Paradigm, Elon Musk helps you to shill, or Trump makes a big plate for you, it will not work now. There are too many plates now. Even if it works, the actual model is that the people in front cut the people behind. As long as the people behind don’t come in, the plate will collapse.
Xingpt:
Yes, the price of Binance new coins is not rising anymore, and the circulating market value is very low. What do you think about the price of coins? Is it a pressure for you?
Yan Xin@Sign
There is definitely pressure. After all, we have financing and we need to make investors profitable. We recently repurchased the money of pre-seed investors. The price of the coin is definitely important.
But I think how do you maintain the price of the currency and how do you make it go up? As I said, you need to have your own set of things. We now have product capabilities and business capabilities. First of all, the company can survive, not by selling coins to make money. Secondly, the business has developed. On this basis, it has become a model where it is not our team work2earn, but the community contributes and earns tokens. I think the mining machine disk is the most reliable.
Xingpt:
It still needs PoW, right?
Whether it’s Ethereum or Bitcoin, PoW is the way to go. Now UBI may just mean that everyone contributes something else.
Yan Xin@Sign
Yes, let everyone contribute, such as traffic, whether it is put into Perp DEX or US stocks. You hope that the money from traffic monetization and the mined coins can be balanced or discounted. If they can be balanced, there is a chance. Pi can basically break even now.
This is the direction of expansion that I can see. The advantage of PoW is that everyone contributes. If you don’t contribute, you will have no coins. It is not like PoS where the people behind always have to take over from the people in front.
Xingpt:
OK. For example, if you have a specific idea now, what will be the form of community contribution on Sign in the future? Because each contribution form has a different path, for example, Worldcoin relies on iris to sell identity, and Pi relies on completing tasks and socializing.
What type do you think the Sign will be, or are you still figuring it out?
Yan Xin@Sign
We have thought it through clearly. BTW, the problem with Worldcoin is that it is not a continuous contribution, but a one-time contribution of iris, which cannot be sustained. You accumulate a lot of information, but you cannot monetize it, and you cannot get the money back, so there is no reason to continue.
But for example, Pi relies on community traffic and can break even by selling advertisements. We will learn from it, which is equivalent to integrating Worldcoin + Pi. Worldcoin has various utilities. For example, there are mini apps in it, which can be wallets, identity authentication, etc. But Worldcoin has no user engagement. It is an app made by Americans. You get money once a month. You have no reason to open it every day, so the traffic will not increase. Pi needs to be opened every day, and the traffic is large, so it can sell advertisements. Just like Alipay, it has both normal services and Ant Farm, which allows you to engage every day. We will do similar splicing. What I am doing this year is to cooperate with the country, such as offering them Tax Deck, building a chain to the ID system, the minimum living security system, and issuing the UBI system. In fact, it is to help them issue the country's money and cooperate with their stablecoins. In the future, for example, UAEPS, the UAE's things, will be a KYC-passed stablecoin account after getting the ID card.
Yan Xin@Sign
Yes, we do this normally. The goal is to get the number of Sign Apps installed to 10 million or 20 million. This way we can put ads and apps, such as hyperliquid, US stock trading platforms, and various services. It is normal for US stocks to be deducted by 10%. It is expensive to buy US stocks for Turkish people. We can put good services and assets worth promoting globally, and even pensions and insurance. For example, we can set up a fund on Wall Street to manage pensions denominated in USDT. This is our goal.
Xingpt:
Yes, anyway, we should build up users first.
Yan Xin@Sign
Yes. User contribution is actually, we now have 4 types of SBT in the community, and there will be in the Sign App in the future. Entering is like choosing a profession in World of Warcraft, such as Serious builder, making things together; support warrior, which is reply guy, likes, interacts with others, and provides emotional value every day; orange blood is orange blood, inviting others to join; and there are things related to staking.
Xingpt:
I understand, there are still some social functions. The example you gave of Alipay is a good one. Alipay is actually a kind of SBT. You register with your ID card, bind your bank card, correspond to the blockchain address, and then have some social activities. The concept of Alipay on the chain is quite interesting.
Yan Xin@Sign
Yes, Alipay for the whole world.
Xingpt:
This is very interesting. I think it is also meaningful to combine with stablecoins. In fact, there are not many solid narratives in the crypto now, Bitcoin is definitely one, and stablecoins are also one. If it can be combined with stablecoins, it is also a direction. What do you think of the industry market or industry development? Now it seems that everyone is quite confused, the market is sluggish, there are too many VC coins and meme coins, and I don’t know how it will develop in the future.
The second is that VCs and entrepreneurs don’t know what to do. People who have issued coins also want to pivot, which is actually quite difficult. I haven’t encountered this situation since I entered the circle. Although there was a bear market in 2018 and 2019, everyone knew that they were working on public chains, such as Solana. It was difficult to raise funds at that time, but the direction was clear. Now everyone is working on new things in AI, but in fact they don’t have much confidence. I don’t know what the next wave of narrative in the crypto will be. What do you think?
Yan Xin@Sign
I think so too. In fact, when I went back to New York in early March, I talked to several project founders there and everyone was quite confused. I think we should still look for the big narrative and not focus on the small narrative, which will soon pass. Nowadays, it is easy to invest tens of millions of dollars in something that will become obsolete in three months. It is very dangerous.
So I'm betting on the biggest things possible. For example, the ID system we made is globally available. You use an ID to do KYC now, and the exchange takes a photo, but it can't actually verify your passport, and it can't be verified like verifying a transaction. We want to make it like that.
I think the digital infrastructure of the future will be world-class. World currency is the first world-class thing, Starlink is a world-class communication network, and in the future more and more infrastructure will be world-class, and ID cards, banks, and academic qualifications can all be verified globally. This is the direction we have been blindly advancing.
This is the only direction I find credible. I am not afraid of returning to zero if I accumulate knowledge along this path, because this is the trend of world development.
In addition, we need to find specific pain points. For example, why are small countries willing to cooperate with us? They do not issue their own stablecoins. They have to pay an 8% handling fee every year to use the existing payment system. 8% of the country's electronic currency flow is given to Visa, which is actually even darker than the crypto. So if there is a chance, they would rather issue their own national currency and build their own payment system, and we will help them do it. I believe that although it is not popular now, it will be a trend in the next 5 or 10 years. As long as the company survives, I dare to keep doing it.
Xingpt:
I see. In addition to the direction you are working on, as an investor or observer, what new directions do you think are promising that have not yet emerged or are not being pursued?
Yan Xin@Sign
I am actually doing what I am optimistic about. For example, I think we can build a mini religion (mini religion/community). What does it mean? Murad first said this when he was promoting memecoin. This term has a great influence on me. Now that AI is developing so fast, 1 billion people will definitely be unemployed in 5 years. These people can neither do research and development nor screw as well as robots. These people need small platforms to give them something to do. I think it is great to build a mini religion. Your network should not be a tool to get work done faster, but a platform for everyone to provide emotional value to each other. Now we measure people by money and work. In fact, in the future, machines can do everything, and people should just provide emotional value to each other.
Nowadays, picking up girls also depends on whether you can provide emotional value. No one is fucking hungry, and no one wants your food.
It would be awesome if we could create a system that provides emotional value to 10 million people.
For example, when we build a community, we don’t just let everyone listen to me, but let everyone reply, like, and interact with each other. It’s a network, not a point-to-point communication between me and everyone. I think this is a very entrepreneurial opportunity, beyond crypto.
Our company actually has three businesses now: one is to build a community; one is to do sign, cooperation with G and sign App; the other is token table, which is to be a crypto broker and put various assets on the chain. Now everyone has USDT, which has been internationalized. Can we buy different assets based on USDT? For example, gold has risen recently, and it is not easy for Chinese people to speculate in gold. We let everyone use USDT to buy any asset, put all assets on the chain, and everyone can trade. I just want to put US stocks in the Sign App.
Xingpt:
But FTX and BMan have done this before, and they all seem to have been suspended due to compliance. Do U.S. stocks still have to rely on compliance?
Yan Xin@Sign
All are possible, but compliance is also changing now. After Trump came to power, he can basically do anything. Only compliance will have a chance. We have no chance in mature markets.
Xingpt:
Yes. What do you think of this wave of AI? Recently, AI and robotics (non- crypto) are very popular, and many projects in the crypto have also turned to AI, pure AI things. Do you think it will have an impact on the crypto? Will attention and funds be sucked away?
Yan Xin@Sign
This is an objective reality, and it is quite healthy. Any industry needs to be constantly screened, with one wave of people being screened out and another wave of new people coming in. Only those who remain after the screening will be the crypto of tomorrow.
Some people like me can’t do AI and don’t know how to do it, so I just ignore it. Some people who are already dual-roaming can enter the crypto or retreat to AI in Silicon Valley.
Xingpt:
I see. When do you think the next big wave of crypto market will come?
After the ETF, the cycle is different from what everyone expected. The BTC price model based on the four-year cycle has been falsified. Now if we want to think about the new cycle, there are many different opinions on the cycle. In fact, the cycle is very important when you do a project. What should you do in the bull market and what should you do in the bear market? This is also a very important point to think about. What do you think?
Yan Xin@Sign
I blindly believe in the four-year cycle, and I think that last year's 100,000 Bitcoin was actually very accurate. Using log as the Bitcoin annual index, it has always been a straight line in the past. Last year's 100,000 was also very accurate, but it has not reached 150,000 or 200,000 this year. Assuming that it reaches it and it is accurate, there is still a chance overall.
Now, the ETF is more closely related to the US stock market and is affected by the macroeconomic environment, but in general, the crypto is still very small, with only tens of trillions of money. As long as the wind comes, it can be pulled up again. Why do I blindly believe in the four-year cycle? Because I don’t see any reason to change the cycle. I think the determining factor of the cycle is the memory of retail investors. After a period of time, everyone forgets how they lost money last time and enters the market again. FTX hurt everyone a lot, but after two years, no one cares, because didn’t Hyperliquid rise again last year? Everyone doesn’t care about decentralization or centralization. As long as someone shill for another wave, there will be no problem.
In mathematical models, the cycle will slowly lengthen, but not very quickly. It is essentially the result of collective behavior game of people, and it is a very fixed pattern. Because it has always been four years in the past, I don’t see any reason for it to change.
Xingpt:
I think you have always been very accurate in your pace. In 2021 and 2022, you will raise funds in the bull market, and in the bear market, you will look for cash flow or cash flow business. How do you grasp this cycle? What should you do in the bull market, and how should you survive the bear market (as an entrepreneur)?
Yan Xin@Sign
Of course it has something to do with the company's stage. First of all, I'm bragging. I've never failed to predict a bear market. I successfully buy the dips when I just entered the circle in 2018, and I also successfully buy the dips in 2021 and 2022. I have always blindly believed in MVRV and believed that the core valuation of the crypto will not fall again after everyone loses a certain amount of money. Overall, it is still within the plan. Now we have reached the A round, the company can make products and make money, and the bull market will continue to expand, tell bigger stories, and gain more attention and users. In the bull market, there is an opportunity to talk to the government. In the bear market, everyone thinks that the crypto is a scam, and the bear market will develop in a creepy way, and it will repeat.
Xingpt:
Do you think there will be a rebound this year or next year? Now VCs have all transformed, some are market agencies, some are secondary investors, and some are just lying flat. I don’t think this will last long. Do you think there will be a rebound or will it take a long time?
Yan Xin@Sign
The market will definitely pick up, but the industry structure may not return to the past. The current VCs were actually spawned by the last wave, and there were not so many before. Most VCs actually have no judgment ability, they just follow the leader and give some money. The real VCs are those who can organize and endorse. Everyone in the industry knows that there are few capable people, and such VCs will continue to survive. It is normal for those who are incapable to die, and they will do something else.
As the industry matures, more and more people will join. In 2017, people were playing with concepts, and anything related to blockchain was awesome. In 2022, everyone gradually began to know about Bitcoin, and now they are moving towards promotion. Whoever can get people outside the circle to use it can expand the circle. The profile of talents needed at this stage is different from before. For example, Alipay started out as a custodian, and later it was promoted to the public. They were two different groups of people. In the future, we will need more traditional people who can do execution and promotion. It will no longer be VCs who just shill.
Xingpt:
It is more like the O2O era, with distribution of goods and food delivery, unlike the first wave of the Internet where everyone was an online webmaster.
Yan Xin@Sign
Yes, that era has passed.
Xingpt:
Attention is lower and harder to obtain.
Yan Xin@Sign
In fact, the people who really understand Bitcoin and decentralization in the world have all entered the circle in 2013, 2015, and 2017, and have entered the circle repeatedly. Now we can only expand to find people with IQ 70-50. This group of people does not care whether you are decentralized or not, but only cares whether you can get benefits. You speak a different language and play a different way with them, and you are no longer the group of people who believe in the "decentralized future".
Xingpt:
You are absolutely right. The current halal and purely technical narratives are actually not taking off. They are self-circulating within the circle and cannot get out of it.
I think the biggest problem now is that there are no positive externalities. There is no positive externality in creating narratives internally. This wave of people has come in, and only ground promotion or UBI can attract new users.
The question I am thinking about is whether it is possible to use non- crypto methods, such as AI applications and consumer applications, to first attract users and then tokenize them, without issuing coins first, and then expand to the crypto after the number of users grows. Do you think this path is reliable?
Yan Xin@Sign
I don't think it's necessary to "expand to the crypto", it should be said that it can only be "reduced to the crypto". The users of AI, payment, and applications are much larger than the crypto. You can issue coins, but there is no need to play with VCs and users in the crypto. You can just issue a coin based on AI users for everyone to play with. There is no need to return to the familiar crypto. There is no need to let degen and VCs in the crypto buy your coins. They will sell them after buying them for a week. In fact, these people are meaningless to you from a certain perspective. They will not hold your coins. They buy them to increase the trading volume of Binance, which is useless to you.
