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Method To The Madness
Nadir Akhtar and Ashvin Nihalani

Method To The Madness

Play Episode Listen Later Feb 16, 2018 30:42


UC Berkeley students Nadir Akhtar and Ashvin Nihalani, members of Blockchain at Berkeley, discuss blockchain technology and token economies.Transcript:Lisa Kiefer:Method to the Madness is next. You're listening to Method to the Madness, a biweekly public affairs show on KALX Berkeley, celebrating Bay Area innovators. I'm your host, Lisa Kiefer. Today we're going to unravel the mysteries of blockchain technology. I'm speaking with-Ashvin N.:Ashvin [Nilani 00:00:20].Nadir Akhtar:Nadir Akhtar.Lisa Kiefer:Two members of Blockchain at Berkeley. And before we start talking about blockchain, can you tell me what this organization is and when it got started here at Cal.Nadir Akhtar:Fall 2014. It was originally a Bitcoin Association of Berkeley. Get together club, social club where you just talk about Bitcoin, talk about related technologies, blockchain. But in Fall 2016, a man by the name of Tobias Disse from the Netherlands, exchange student, said we should start a blockchain consulting group. And that was when our entire organization changed.We went from a social club to several layers of management producing output, high standards organization, like a company. But the leadership is entirely students.Lisa Kiefer:In the paper every day, there's something about blockchain, something about cryptocurrencies; and a lot of people don't really get it. So can you in layman's terms describe the blockchain technology?Nadir Akhtar:A blockchain is essentially a ledger shared by multiple people, which any one of those people can edit. The difference is that you don't have to trust any of those people when making edits to the distributed ledger. Analogy I like to use is if you're watching a sports game and there's the referee; you can either trust the referee alone to keep track of the score.It's much more efficient to know what the score is at any given point, but you trust that referee to be correct, not to be bribed or to just slip up. If that referee makes a single mistake, there's no check unless you have other people watching. A blockchain is like putting the burden of keeping track of the score on the audience instead of just on the referees.Now, you can poll every person in the audience at every stage of the match after every game and ask, "Okay, what's the score now?" And then the entire audience will respond. A lot of people may not have been paying attention. A lot of people may be voting in their own favor, but if you trust that the majority is honest, then you'll always have a correct vote if you trust the majority, or if you go with what the majority vote is.Ashvin N.:So, a succinct way to put it in one sentence is a distributed, replicated, append only ledger. That's what I kind of go for. My one line, and then I'll use it to explain it to anybody.Lisa Kiefer:When the financial crash of 2008 happened, shortly thereafter, a gentleman by the name of Satoshi Nakamoto came up with this idea of an open protocol system.Ashvin N.:You're right. Satoshi Nakamoto, a moniker that we don't know who exactly he is, he created a system for a distributed, trustless financial network. He worked on that, and then a bunch of other people joined in. We had the buildup of Bitcoin and he called it Bitcoin, and then eventually we had it expanding on beyond that, and now...Eventually, the banks and other institutions got interested, but Bitcoin had been associated with some negative aspects, including the Mt. Gox hacks and the overall dark web and the trade in there. So then banks and other institutions said, "We like the technology behind Bitcoin, but we don't want the necessary negative stigma associated with it." So they rebranded it, called it blockchain.Nadir Akhtar:It was rather they focused on the blockchain aspect rather than the cryptocurrency aspect. It was called a blockchain and the technical white paper back when it was two words. When you thought of blockchain back then, there was just the Bitcoin blockchain; but then banks wanted to focus on the technology and what that could do for other services rather than cryptocurrencies.Lisa Kiefer:I don't even want to talk about the cryptocurrencies yet. I want to talk about the social and political revolutionary change that blockchain as a technology will bring to me as a consumer. It's going to eliminate that middle layer of business that I'm not going to need anymore. When I buy a house, I'm not going to need to get my title from a title company. There's going to be a massive disruption in certain industries. Right?Nadir Akhtar:The way I expect is that most of these third parties, they just serve as execution bodies. It's because we didn't have autonomous agents back a few hundred years ago that we had to develop these services like banks, like brokers, that would take care of the middle layer for us.Now that we have blockchain, or now that we have automation in general, we can take things that humans used to do and now we can make sure that those things are executed in a secure and unstoppable way.Lisa Kiefer:In the early days of the Internet, it was supposed to be this decentralized, very democratic system and it evolved into something completely different than that, where we have these monoliths like Facebook and Google and...Ashvin N.:At its core, it's just about decentralized decision making. That's all it is.Lisa Kiefer:What's wrong with centralized?Ashvin N.:Well, I mean that's the question, right? There are certain cons associated with blockchain. These include some technological cons and certain governance cons that you'd come in and are those worth, in some cases the decentralized governance? Is it worth it?Lisa Kiefer:So this is an open question.Ashvin N.:This is an open question. Right. I'm really glad actually that you brought up that it's analogous to the beginning of the Internet because it really is. You have everybody trying to assume that, hey, we're going to blockchain this, we going to have to blockchain that. Similar to how everybody said everybody had a personal website and everybody had their own little company page. But is it actually useful in some cases? Maybe, maybe not.At its core, it's decentralized decision making and that's what makes it so attractive to some people.Lisa Kiefer:Efficiency-Ashvin N.:I wouldn't even say if it's efficient. Right? In some cases, the way you implement a blockchain is less efficient. I mean it comes naturally. Rght? There are certain benefits to centralized decision making. Going back to Nadir's referee example, it's much more efficient for one single person to keep track of the score rather than having everybody keep track of the score. Right?Both in terms of memory and in terms of-Lisa Kiefer:Energy.Ashvin N.:Energy. Right, and that's another point we'll get to; but it's about are the cons associated with blockchain worth a decentralized decision making?Lisa Kiefer:Your organization, do you really honestly debate this?Nadir Akhtar:It's very easy to to bow down and worship something and not question its implications. The thing is that blockchain is unique. We recognize that it's unique. Blockchain is an interdisciplinary field. No other field mimics the way the blockchain works. You have to know from economics to computer science to cryptography in order to understand fully the implications of blockchain, but blockchain solves very specific problems in the world.There are aspects of blockchain that are more useful than other ones in certain situations. When you have a very specific problem, when you have this decentralized decision making, this trust issue between parties, that's when you want a blockchain because now you can have this immutable ledger that also comes to consensus in a way that doesn't rely on any single person. Instead, you trust this math in the protocol when you're making decisions when you're operating within the system.Lisa Kiefer:Can you give me a couple of every day examples that are going on right now that use the blockchain?Nadir Akhtar:Cryptocurrencies do come to mind.Lisa Kiefer:Define what that is.Nadir Akhtar:A cryptocurrency is a currency that's built off of economics, computer science, and cryptography. Economics in order to understand the behavior of every actor in the system; computer science in order to make sure that the information can be stored in an efficient manner, because keep in mind, because this is a distributed ledger, it's going to cost a lot of memory in order to handle all this information.We're storing hundreds of gigabytes all the way from 2009 on our computers in order to store the bitcoin blockchain, for example; and cryptography in order to maintain security and privacy for the people involved.So when you submit a transaction to the Bitcoin network, you don't send it to a single person who takes care of it. Instead you send it to thousands of people who all can act in your behalf to verify your transaction, but there's a certain voting process which is known as proof of work that decides who gets to actually decide what transactions go into the next block of the blockchain.Lisa Kiefer:It's kind of a competition between data nodes, like who can do this better and that's where all the energy use happens in the network. Correct?Nadir Akhtar:Precisely.Ashvin N.:It's faster and not necessarily better. I'm kind of looping back to your original question and I would like to make one small addition. Many people mistake that cryptocurrencies is like a financial network of some sort where you transact; but, especially as we've seen the industry mature a lot, it's not at all. I mean, all cryptocurrencies he mentioned it; that it's a system that uses economics, cryptography, and computer science to kind of, and a token to kind of achieve some purpose.I think it's an important distinction because there are cryptocurrencies that have a token associated with them and have a economic volume but they achieve completely different purposes. There's a supply chain one; there's a property deed one; there's one that tries to solve AI on a blockchain.There are all of these principles that's being developed and it's not necessarily just meant for financial network anymore even though it is one of the most prominent examples because it's the one that we've started off with. It's the one that's been tested the most often. It's the one that has the most underlying principles associated with it.But kind of looping back, we have cryptocurrencies, which is a tokenized network. And then we have supply chain is being tossed around a lot by these kind of big companies that want to get into blockchain. Then we also have some kind of medical records are getting interesting. Medical records, there's certain problems associated with that.Anywhere that you need, that you don't necessarily trust that the data either is going to be secure or the updates to the data aren't there. And once again, looping back to the general theme that you want decentralized control or decentralized decision making.In general, blockchain is being used to enforce accountability and reliability. Kind of like the fact that the data that you sent is kind of true and it's kind of secure. That's kind of where it's going. There are interesting applications being developed for the renewable energy credit market and then also in general, just overall accounting as being kind of revolutionized by blockchain.Lisa Kiefer:If you're just tuning in, you're listening to Method to the Madness, a biweekly public affairs show on KALX Berkeley, celebrating Bay Area innovators. Today I'm speaking with Ashwinee Panda and Nadir Akhtar, members of Blockchain at Berkeley. There's that kind of an irony with energy because it uses so much energy. And let's talk about data mining.Nadir Akhtar:The fascinating thing about Satoshi Nakamoto's innovation when it came to Bitcoin and the first blockchain was that he changed the way that a voting system works in a distributed network. Distributed systems are something we've known about for decades. Research has been done for the last 30 years about how to make distributed systems secure and efficient where a distributed system is merely a bunch of computers trying to achieve the same goal as opposed to a single computer.The reason that this plays into Bitcoin is because every single person who's participating in this Bitcoin network is essentially their own computer, their own system, their own entity, and all of those people need to be able to coordinate with each other despite not knowing who each other are, despite not knowing how much resources another entity has, despite not knowing how much influence another entity has.In Bitcoin, you solve what's known as the double spend attack. The problem that prevented online decentralized voting, like voting on transactions in Bitcoin for example, was the civil attack where someone can at little cost to make another identity and use that extra identity in their own favor.So if I'm with 10 other people in this Bitcoin network and identities are easy and to make, I can't trust that one of these people isn't actually just belonging to someone else, that all 10 of these people aren't just the same person, in which case my votes as a single entity is being overruled by another single entity.In a distributed system, all entities should have equal voting power. Satoshi Nakamoto's innovation was to go from one identity, one vote to a one CPU, one vote system, meaning that instead of casting a vote because you have an identity associated with the network, you cast a vote by computing the answer to a puzzle.And this puzzle, you can't solve by hand; you can't guess the answer to. It's like a brute force puzzle, like solving a password. You just try as many inputs as possible until you finally find the output. And that's where mining comes in. Because you've restricted the voting process to machines, a person can't duplicate those the way that they can duplicate their online accounts or their online identities.And that is what prevents a person from voting more than they are allowed to because you tether their identity to the resources instead of to their online entity.Lisa Kiefer:So all these machines are grinding out this competition and that's the mining?Nadir Akhtar:Precisely. That's good.Lisa Kiefer:And that uses a lot of energy obviously.Nadir Akhtar:Mm-hmm.Ashvin N.:I would like to point out that there are alternatives. I mean, the cryptocurrency and the blockchain space in general has known that this is a problem. We've known it for a while, especially with the widespread adoption we're seeing now. We see it as a very big problem and it's gotten to the point where it's no longer decentralized. Right?And one of the very big points in voting, like when we decide on what voting algorithm to use is how centralized is it? Because in this case, it's gone to the point that you can only mind by having specialized hardware. They're called ASICs, application specific integrated circuits. And if you don't have one of those, you're not going to be able to mind successfully. You won't beat out anybody else.So what's happened just to the nature of an evolving marketplace is that all the smaller players have been pushed out, and now we have these giant farms sitting in China and India. China, India, Iceland's a very good one because they use their temperature to keep the electricity costs low. So we have that and it's not really centralized anymore.So there are alternatives being developed that do consume less electricity or consume no electricity at all. The most popular one would be proof of stake where you basically say that you have to hold in reserve some of the coins that you associate to votes. So instead of one CPU, one vote, it's one coin, one vote. And if you act badly or you lie about it, then we slash your vote; we take away the coins that you've put down.There are alternatives being developed and it's a big thing that we noticed. I'm just saying that, especially in a lot of industrial applications, they're not using proof of work. Proof of work is considered by a lot of people to be kind of an antiquated system. It was good back when it started off, but because they-Lisa Kiefer:It used too much energy.Ashvin N.:It used too much energy. I mean, what was the last estimate? It used more energy than Iceland or something like that?Nadir Akhtar:Yeah, it's been insane about how much energy it is.Ashvin N.:It kind of ties into the greater problem or a greater trend in the blockchain industry is that we are becoming more and more concerned about our impact on the world. You see it with a lot of people who want to be ethical. A lot of knowledgeable people. We ourselves kind of do that on our part by trying to propagate like the correct knowledge and how to do things.Lisa Kiefer:Who else is looking at this from all sides?Nadir Akhtar:Blockchain at Berkeley is unique and that's one of the only neutral arbitrators of information, being an academic organization run by students and not by companies. There are other organizations like the MIT Bitcoin Club, U-Penn's Blockchain Club that are also doing this. To my knowledge, they're not as prominent in the general blockchain space.Lisa Kiefer:Let's talk about some other cryptocurrencies like Ethereum.Ashvin N.:Ethereum is unique in the fact that it has decentralized applications called depths. Basically, Bitcoin does have that, but it's to a much limited degree. It's a very, very limited degree. You can only concern financial transactions.Lisa Kiefer:It's like applications sitting above the blockchain.Ashvin N.:Yeah. In Bitcoin, the only thing you can append a financial transactions. You can only say that I'm moving money from this to this. However, in Ethereum, it's built in such a way that you can append much more than that and then you can append full on application changes. Right?Sorry if I get a little bit technical, but the state changes are recorded, right? I mean that's saying that there's one state right now and then let's change it up and then that state, and then you can do applications. There's a Minecraft application that was built on a Ethereum. Minecraft's a game. It's completely run on Ethereum. It's really quite interesting.But going back to other cryptocurrencies, bitcoin has an anonymity problem that's been widespread without. Rather than being truly anonymous, it's tied to a mask instead. That's the best way I can say it, that it's like everybody's wearing a mask.Everybody still knows that there's a specific person associated with the mask. They just don't know who's behind the mask. And that's kind of the definition of pseudo anonymous. But there are other applications. Monero, Zcash, that try to make things truly anonymous so you can't trace any type of transaction amount or in between the participants, except for the participants.And then there are other things. There are all these new alt coins coming out that try to solve other problems. For a long time, there has been a problem with AI and blockchain because those are the two sort of big buzz words going on. So, let's do AI on blockchain. There are a lot of cryptocurrencies that try to solve AI on blockchain.Lisa Kiefer:What would that mean to use AI on the blockchain?Nadir Akhtar:AI and blockchain serve two different purposes. The issue is whether or not using one can facilitate the accomplishments of the other. AI is in data analysis and processing and blockchain is in data storage and agreement. Let's say that it's 2200 and I want to make a supreme overlord that is an AI, something that is making decisions for all humans.But I don't want to put this decision making power in the hands of any single computer. So I create an AI that lives on top of a blockchain. So on one hand, you have what looks like just a single entity that's running this AI; but in actuality, it's a blockchain network. And every update to this blockchain is an updates to either the AI's model, so to say, its decision making strategies or an update to the actual decisions, the computation that the AI has done.Lisa Kiefer:Could it keep the AI ethical?Nadir Akhtar:Well, that's all in the hands of the people who run the end points, who control the blockchain notes.Ashvin N.:A lot of people say that blockchain will eliminate the middle layer or increase trust or make sure that we all can live in harmony; and the reality is it's just as susceptible to corruption or anything like that as other people.Lisa Kiefer:I thought it has never up to today, it has not been corrupted.Nadir Akhtar:It's never been corrupted in that the math and protocol behind blockchain is secure. The difference is that if you don't trust the end points when you're dealing with things like supply chain, then in that sense you can corrupt the blockchain.A blockchain doesn't facilitate the transfer of information from the real world to the virtual world. It doesn't stand behind some person who's inputting data into a computer, but what it does is ensure that it's much easier in this virtual landscape to keep information accurate and uncorrupted once it's been inserted into the blockchain.Ashvin N.:And then I think it's important to realize that it's not really developed yet. We had the Ethereum, the Dow hack of 2016 that resulted in over... I forgot the exact amount. A certain amount lost. We had the Japanese exchange that was hacked a week ago.It really comes down to the fact that blockchain allows for a secure or efficient way to distribute and decide about information, but whether that information is correct or not, or whether you can control the voters, that's completely up to kind of whoever's in the system. It's unique in the fact that the voters don't have to trust each other, but there's also problems associated with the network as a whole.Lisa Kiefer:Right now, if you're on Facebook or Amazon or Google, my life's history, if I use those monoliths, if they have it, they use it, they make money on it. Will blockchain enable people to monetize their private data, get paid for our personal data via blockchain? Is that a possibility?Nadir Akhtar:There's a lot of research going into this. It's tricky to say, for the reason that I haven't seen anyone yet successfully do it; or if they've done it, it's too early to tell whether it be successful. Traditionally, Facebook stores your password, stores your email address, stores all the information.With blockchain, you're responsible for holding on to that information yourself. It takes the burden off of a central organization and puts it on the user. The issue is that if the user isn't securing their own information correctly, it's just as vulnerable, if not worse. Right? We sort of enter a social contract when we go with these big companies because they handle a lot of stuff in exchange for a lot of free stuff.Lisa Kiefer:So I would get value for my data, but I would also have to really manage it and make sure no one steals it, and how many people know how to do that? The regular layperson.Ashvin N.:Right. It comes to problem when you see people... If you ever browse certain support forums, they'll say, "I lost my pass- or private key in this case. How do I get my money back?" Or our one thing is that we've seen due to adoption of Bitcoin and other cryptocurrencies, we've seen a big jump in hackers and there are certain security protocols.When somebody posts that, "Hey, I got hacked." And at that point, there's nobody to blame. I wouldn't say nobody to blame but yourself; nobody can help you. There's research being done in, about account recovery and so forth. But at this point, like I said, there's no organization that's going to hold your hand and say, "It's OK, let me refund you."Lisa Kiefer:Is this where a regulatory body comes in or some sort of a governmental controls?Nadir Akhtar:That's the very funny thing about blockchain. When you say we want to put regulations on this deregulated network, there's always this conflict between putting the trust on the end points, the users, letting them make their own decisions freely or having some centralized or central-ish entity that makes decisions on behalf of all of the users.There was this one project, it was an ICO or initial coin offering known as Tezos. What Tezos wanted to do was put governance on the blockchain. When Bitcoin and Ethereum undergo changes, it's an informal process; sort of like an ad hoc group of people who know what's going on, who say, "Yes, I think we should do this. Yes, I think we should increase the block size," for example, to allow for more transactions per second. "Yes, I think we should change the way that we read information in a block or whatever it may be."Typically we say, we go on to some forum online, make a post about what we want to change and everyone says, "All right, I'm going to update my software at this point." What Tezos wanted to do was make rules about the rules. In other words, you vote within the blockchain about what the rules are governing, that voting process and the blockchain instead of having to do it outside of the scope of the technology itself.Lisa Kiefer:How did that work out?Nadir Akhtar:It's funny. Tezos has actually been sued twice. In summary, Tezos was not actually producing what they said they would be producing. They said, "Here's our plans for the future, here's our expectations, here's how much funding we need," and people paid them because it did sound like a good project.There's a lot of problems that can be solved with the solutions that Tezos was proposing. The issue is that once the developers have millions of dollars in their hand, they don't really want to work.Ashvin N.:So going back to Tezos, right? It's still doesn't solve the issue we're talking about. It's a big problem we see in ICOs because there's whales coming in with massive amount of money and then they'll manipulate the market. Nobody's going to control them. Nobody can control them because it's a decentralized network and then even in Tezos, even if you have to do Tezos, you have to get the entire community or majority of the community to agree that this person's bad and then they can always subvert the system by creating another identity.Just because of the nature of blockchain, it's very, very hard to introduce any kind of regular oversight. The only way that governments have successfully been able to do it is that these end points that we keep talking about, like where you get into this space where you buy a coin or so forth, those can be regulated.The most prominent ones, if the view is neo coin base is where you buy it though Coinbase has succeeded to federal oversight on multiple times and they have started giving it over records and so forth. It goes back to the fact that blockchain itself isn't inherently suspect free or anything.All it does is that it makes sure that the system itself, there's a... I guess the best word would be error free and then however the users act, that's up to the users.Lisa Kiefer:Tt sounds like there's a lot of challenges; but do you think in the long run, blockchain is going to be a standard and if so, how many years are we talking about?Nadir Akhtar:I don't want to replace every single database with a blockchain for the reason that I wouldn't replace every single mode of transportation with an airplane. Airplanes are very good at doing some things, like transporting passengers quickly and boats are very good at transporting large amounts of cargo. Each one serves its own purpose.Similarly, blockchains, they serve their own specific purpose just as centralized databases do, just as a distributed but fault free or nonpublic systems do as well. I think blockchains could be a standard when it comes to eliminating third parties. I do believe that.The only reason that we haven't done it yet is because we just didn't have the capability to remove the human execution error that we have dealt with for the past few thousand years as a species. Once we have enough research done to where we can make secure regulatory bodies through a blockchain, I do think that they will be the standard for the middle layer of trust that we have put in these third parties.Ashvin N.:You'll never actually know that a blockchain exists behind your application and you never should. Blockchain, for better or for worse, is very much a back end technology, for those familiar with computer science terms. It's the way to make a database more resistant and more secure, but you'll never know it. Will blockchain become a standard? No, not necessarily.One concern that I personally have is that I have yet to see a good use case other than a financial network. One that's fully developed out or so forth, and then governments will never want their money to be on a blockchain.Bitcoin, for better or for worse, is a financial network that does really well. Ethereum is a distributed computer, but there are certain problems with their end that have yet to be addressed. People are jumping on the hype and saying blockchain will rule the world. No, it won't. We really won't.Blockchain at best will improve the efficiency and security of several already existing applications and that'll be a go. But once again, blockchain is not meant for the end user to directly interact. They'll interact with an application and then the database, the application associated with it, will be a blockchain.All you hear about Bitcoin is one of two things. "Hey, it's super volatile. I made 10x money." Or that you heard that, "Hey, somebody got hacked." I mean, there's been a very big negative stigma and that's been a limiting factor for company adoption and also people are doing it.Chase has been in the market. JP Morgan has been in the blockchain one for almost two years now. They had developed their own private blockchain. IBM-Lisa Kiefer:Do these blockchains communicate with each other? Can they?Nadir Akhtar:They can.Ashvin N.:There's two separate you can do it. You can either do it with a main chain and associated side chains or you can have completely separate chains that interact with each other. IBM sponsors a research group slash set of products called hyperledger and they're all meant to interact with each other. So interesting capabilities there.Companies are slowly adopting it. Currently, there's a bad stigma associated with it. A lot of lack of talent is another big thing that companies-Lisa Kiefer:Oh, interesting.Ashvin N.:Yeah, companies are hiring up. If you want to get money real quick, if you want to get a good six figure salary, become a blockchain dev. There are tons of resources available, including our own dev courses that we kind of provide.Lisa Kiefer:Tell me what your organization offers the community both on the campus and outside of Berkeley.Nadir Akhtar:We have three main departments, each of which has their own vision and mission. We have education, which as the name implies is focused on teaching people, but not just students; entire communities, companies, anyone who is dealing with blockchain, we want to educate. We have two courses that we teach on the UC Berkeley campus. You actually can take the course online this coming May when it's going to be released on edX. It will be the first blockchain crypto course fully on edX.We actually are developing certifications for different parts of the blockchain space. We have certificates for blockchain fundamentals, for blockchain developers, for blockchain consultants or researchers, and these certificates are tests of knowledge similar to the SAT. It's a standardized test that says whether or not you have the aptitude to understand some aspect of blockchain.This certificate I mentioned related with edX is a certificate of completion saying that yes, you have actually gone through this online course as opposed to just going through a bunch of YouTube videos and now claiming to be an expert. We have the consulting branch, which does work with companies and trains internal members, devs, and consultants.The consulting branch has worked with Airbus, Qualcomm, BMW, and going to be working with more of this coming semester to build real projects that are used by these companies. We've also worked a lot on internal projects. This one pharmaceutical problem, a supply chain, the U.S. passed a bill saying that by 2022, 23, all pharmaceuticals, the entire supply chain needs to be recorded and tracked in an immutable, auditable way. Right?Naturally, blockchain lends itself easily to that, which is another project we worked on internally.Ashvin N.:Then the third department is research. Research and development, R and D. These work on solving several fundamental questions and issues that are still prevalent in the research space. We are currently partnering with the Kyber Network, which is a distributed exchange and also that we're working with Ethereum foundation to start working on some of the scalability issues.We try to be an all in one company and we try to do everything at once; and so we provide education to our members, both to the public in general and to companies as well. We kind of develop software and developed products and then we also do research. We do have events for all levels, all ranges of knowledge; from beginner all the way to end and then if you do want to jump into the deep end, it's not hard. We do have our previous courses available on an archive so you can just go and look through those.Nadir Akhtar:You can actually audit our courses here at Berkeley for free. Conveniently for those who have work, there is the blockchain fundamentals course on Saturdays 2:00 to 4:00PM that I and others are teaching, from Blockchain in Berkeley. We have the blockchain for developers course as well. If you're interested in those events, that education hosts, just go to blockchain dot berkeley dot e-d-u; and check out the education tab.Lisa Kiefer:And you can find out about all this stuff you just talked about. Thank you for coming in.Nadir Akhtar:My pleasure.Lisa Kiefer:You've been listening to Method to the Madness, a biweekly public affairs show on KALX Berkeley, celebrating Bay Area innovators. You can find all of our podcasts on iTunes University. We'll see you in two weeks. See acast.com/privacy for privacy and opt-out information.

Secret MLM Hacks Radio
42: Curing Downline Overwhelm...

Secret MLM Hacks Radio

Play Episode Listen Later Dec 8, 2017 13:43


What's up guys. Hey. Hope these days going fantastic, and you're killing it, and you woke up smiling. If not, I invite you to do so. It's amazing what it does for your day. Hey, so ... Hey. When, I first joined ... It was the very first MLM I ever joined, and I got into. I ran into a problem really, really soon and imagine that you've probably run into this too, at some point in your MLM career, if you're still in one. What's funny is I actually learned that a lot of people who are listening to this right now, are not in MLM. They're just looking for one. I didn't know that. How you guys doing? Anyway, great to have you. Anyway, so the first time I ever joined an MLM, I ran into this issue, where I was excited to be a part of it, and I was running. I was literally going door-to-door down Main Street. I was trying to recruit friends and family. I was doing ... You know what I mean? I had not learned a lot of things that I know now, where I actually am ... I treat it very differently now. I actually value. I actually put stuff out there. I actually qualify leads. I auto close. I've got a lot of tools and stuff like that for my down line. The whole purpose, again of this podcast is to help show you what I do, so you can do it in your own business. I don't care whatever it is you're in. As long as you love it, great. That's awesome. Go kill it and crush it. That's great. The other purpose of this podcast is to go through and show you, kind of documents the journey of me creating this next product for the MLM industry. There's no talk of me trying to recruit you. You won't even know the name of the MLM that I'm in. It's literally just to help you see how someone like me ... I have a heavy, very strong internet marketing background. I was the ... I still am, the right hand funnel builder to Russel Brunson at ClickFunnels. Sat right next to him for about two years. I'm about to leave that job, in about four weeks here, which makes me a little bit nervous, but I'm excited to do it. I'm literally leaving to do this full-time. If that's any kind of testament that what I'm trying to teach you, works. I have two kids. I have four year old and two year old, and a pregnant wife. I would not leave my job, if it was not actually being successful. Okay? Please know that what I'm teaching you guys throughout this entire podcast, and especially in the course I have coming up, works. It's real. It happens. You guys are living testaments of it right now, also, that ... Anyway. Anyway. Moving on. The first time I joined an MLM, I ran into a problem quickly, which was, after I had ... You know, I was doing it the old school way. I made the list of the friends and family. I called a bunch of people. I annoyed lot of people. I went through and I was going door-to-door. I was hustling. I still did it the best that I could. The problem was, when somebody else finally joined my down line, I didn't know what to do with them. Right? They were just sitting there, and it was like, "What do we do now?" I'm like, "Oh crap. Uh. Sorry for sounding like a broken record, but I'm about to tell you the same thing my upline told me to do. Go bug your family members and friends. Go hustle like crazy. Go the next thing, you know, blah, blah, blah, blah, blah, blah, blah, blah, blah." I just started regurgitating all the stuff that I was hearing. Does it work? Yeah. Yeah, it works. It's effective. It's not very efficient though. You know what I mean? It'll work. It's a terrible experience though, and I ruined a lot of relationships with it. You know what I mean? Anyway, that was part of the issue that I was running into with the whole thing. I didn't know what to do with them, after they joined my down line. I was on this call once. I'm not sure if you guys know who Stu McLaren is. Stu Mclaren's a very amazing guy. He makes millions of dollars every year, running membership sites. Amazing value, but he only spends a couple week a year actually building them. The rest of it's all on auto pilot. Amazing stuff. It's the world I come from. Built a lot of membership sites in my day. And so, one of the things that he teaches in one of his courses, is this concept that ... Have you guys ever bought a product before? You've bought the product. You get it and you realize ... You what, there actually is a better example. Christmas is right around the corner. Right? Christmas is right around the corner. Let's say you buy a toy for a kid, and you get this toy and you have to assemble it when you get it. You open up those instructions and the first thing you notice is, it's not a simple set up. Right? You kind of get completely overwhelmed by the amount of steps that it's now told you to do. Let's say you have done this for a kid. Fine. Whatever. A piece of furniture. Let's say you go buy a piece of furniture, and you're like, "Oh my gosh. I'm gonna spend the next two or three hours of my life building this thing. I had no idea." You know what I mean? It's that feeling, you like, "Oh crap. There's that much stuff to do? Oh jeez. Oh, uh. Gosh dang it. I didn't want to go through this today." You know what I mean? That's kind of the feeling you get. It's the feeling of pure overwhelm. Well, what's funny is that it's been learned, it's been noted that the number one reason why people will refund from memberships sites, is become of overwhelm. There's just too much stuff. There's not enough places to go. There's not enough ... I'm sorry, there's too many places to go. There's too many things to do. There's too many options. There's total overwhelm and the person just wants to get out. A confused mind is always a no. Right? The answers always no for a confused mind. A lot of times that ends up happening, when you join an MLM, or when one of your people joins a MLM. When you recruit somebody, the tendency is just to barf all over him. Here's the comp plan. Here's all the specs to the product. Here's how we're selling it in the script behind it. Here's your duplicated website. Here's the events coming up. Here's all the books coming up. Here's what the president has said about x, y, and z. Here's blah, blah, blah, blah, blah. You go and you barf all over these people. Total overwhelm. No idea where to start and it makes someone want to quit. What Stu Mclaren teaches as the way around us, is something called a success path. Okay? A success path. These success paths are genius. I use them in my own MLM recruiting now. Their amazing. Okay? When somebody joins my MLM, what I do is I think through the success path that I want that individual to go down, meaning, what's that number one? All right, well, we should probably have learned about the product a little bit more. Watch this video. That's it. Don't think about anything else. I'm not out to tell you about the [inaudible 00:07:08] plan even more. I'm not about to tell you about all the 12 million events coming up. I'm not about to tell you about the stuff that's going on, and have you re-introduce the 1400 of my upline people. You know what I mean? Just watch that one video. That's it. What else? Don't worry about it. Did you watch the video? Nope. Then, watch that video. That's all. I write it out. I put stuff down, so that they understand what is expected of them, in order to be successful. Right? Both from a business standpoint and a recruiting standpoint and a sales standpoint. I just, I figured it out. I do through. I just simplify it. Okay. Here's all this crap. Let's put it into an organized manner that you can actually digest it, and that it's not gonna stress you out like crazy. That's what I've been building this last little bit here is ... I've built a lot of members areas on the internet. It's one of my specialties, really enjoy doing it actually. I thought, how cool would it be .. This is something I just barely started doing right now, as far as the members area form. It's a dedicated members are that's just for my down line. Not just for the tier that's directly under me. I'm totally fine if it's like, they bring in the tier under them, and they bring the tier under them, they bring the tier under ... It's still all essentially my down line. Why would I not want them all to have a success path, to have training on how to sell each specific product, to have training on all the leads and things you can do out there that's all automated. You know what I mean? Why would I not want everybody to have that? What I've been doing and building, is putting together a members ... When they join, you know I give 'em the option to have the entire members are to themselves too, to duplicate it that way. It's legitimate true duplication, because I know I can build it awesome. That's my actually job, which I'm about to leave soon. Once I build it, I can comb the thing over to 'em. Now they have it for their down line. You know, or they can just give access to the current one too. I'm completely fine with that. Anyways, all I'm trying to do is, I'm trying to just illustrate the fact that, one of the reasons ... This is the case that I'm posing, which is that I really believe that, one of the major reasons why somebody will not join your down line, or when they do join it, then they do nothing, is just sheer overwhelm. They have no idea what to do next. They have no idea what to start on next. There's a lot of information, which is great. There's so much information, that it's completely overwhelming and they just don't know what to do. Create a success path. What is the first logical thing you would have any person who joins your MLM do? I can't answer that for you. That's up to you. Okay? I've answered it for myself, and my team. We're putting those things even more together. I go and I survey people and I say, "Hey. What are you struggling with? How can I help?" We do live calls frequently. We go through a lot of cool trainings. We go ... You know, and we ... The upline is not their only support. The content from the MLM, you know, the corporate MLM is not their only piece of guidance. It's not their only source of training. It's not their only source of, here's how you actually sell. They're getting it from me too. Right? Actually, way more in-depth, than my MLM provides. Right? And so, anyways, that's what I'm super stoked about. I'm very, very pumped to get this piece done here. I've created a lot of "success paths." This is the most in-depth one for an MLM, my MLM down line that I've ever built. Excited to have it. Excuse me. Anyway, super pumped to be able to send that our to 'em. I think what it's gonna do is it's gonna help keep believability. This whole games about beliefs, right? Someone joins your down line, because they believe that it's possible for them to be successful, which is great. They're right. They should. They need to have that belief otherwise why are they do anything. All right? The belief can get killed when they realize that they've got to ... When they feel like they don't just have to read the owners manual alone, but they also feel like they gotta write the thing. You know what I mean? When it's that much stuff. I actually feel like it's actually been preserving some belief patterns, has actually created more, not just of a path that had to be successful, but just like, overall peace. You know, overall well-being. What's neat about it too is it's trained people where to go to get information and they collaborate amongst themselves now. It actually helped duplicate me, and slightly removed me. Not that I'm trying to be removed, but it's mainly that I'm no longer the bottleneck. You know, cause the trainings there. The stuff that I said is there. It's all in there. The success path is there. They know the path from A to Z, how to actually be successful with this thing. Because I'm being transparent about how I'm being successful with it. I'm showing 'em exactly what to do. You know what I mean? It's hand holding at the coolest, but without me having to actually do it, because it's all done through videos and you know, PDFs and ... You know what I mean? All of these different things. Anyway, start thinking through the major sticking points of your down line. Again, I pose the belief that part of that is just straight, sheer overwhelm. If you can't figure out what those pieces are either, just ask your upline. "Hey. What are the things that the people who joined, actually with the first." And then you start thinking through what that success path looks like. What it is that the person is actually asked to go through. Here's an example. You can be like, "Here's what the first 30 days of your life here looks like." I know a lot of MLM's have that, but from corporate they have that. It's so much more powerful if you, the leader gives that to the down line. Hey. Welcome to the team. This is a legitimate team. I'm not just saying it, cause that's what we we're told to call it. This is an actually team, meaning, here is an actual success path we found. It actually made us successful with it. Here's how it's duplicatable, and you know. Blah, blah, blah, blah, blah. If it comes from you, versus just corporate ... Corporate probably has something like that, but if it comes from you also, it's gonna be a lot more powerful and it's gonna go a lot further. Anyways guys, hopefully that's helpful. Go create the success path. Fight overwhelm and I'll talk to you later. Bye. Hey. Thanks for listening. Please remember to subscribe and leave feedback. Would you like me to teach your own down line? Five simple MLM recruiting tips for free? If so, go download your free MLM Masters pack by subscribing to this podcast at secretmlmhackradio.com.