"The crypto revolution is inevitable": who is this ex-hacker who met the creator of Ethereum and "evangelizes" on decentralized finance
The breaking point was knowing the internet. And another, closer was to learn of the creation of bitcoin. "This is great," he said. He bought "a little, but it stayed there." The best thing happened in 2017: "I discovered Ethereum and it was at that moment that I said wow! Because I like to build."
PabloSabatella.jpgPablo Sabbatella teaches Crypto & DeFi at the academy he founded: Defy Education. He is also a Growth Lead at Exactly and an active tweeter.
From the age of 14 he started with a hacking computer security portal. At 15 that site was "the largest in the world in Spanish" on that subject. Later he had "a very large electronic music portal," he says.
“From 2009 I began to study on my own. In investment clubs I studied finance. What happened was that in crypto everything I did came together: a bit of computer security, a bit of finance and a bit of technology”, summarizes this entrepreneur who was in December at one of the meetings attended by Vitalik Buterin, creator of Ethereum.
-What was the first thing you did when you started in Crypto?
-I got up, went to Twitter and started telling what I was learning. In an easy way. I'm not looking to veneer but everyone understands it.
-Why did you take to using twitter as a channel for disseminating what you knew about crypto and what did that lead to?
-What he explained began to grow. A friend of mine told me why don't you give us some little classes. She put it together and Defy Education was left.
It is a crypto academy in which in a course designed to understand from scratch what the whole world of cryptocurrencies and decentralized finance is about. I agree with the crypto philosophy 100% for 100%. And I do a lot for disclosure and for this to grow.
https://twitter.com/PabloSabbatella/status/1476702391315668993You have always been an entrepreneur, but now you have joined a decentralized finance project called Exactly. Why?
-In August I was called by Gabriel Gruber and Lucas Lain, who are the founders. They wanted me to join as the first employee to take care of the entire ecosystem part. I was always an entrepreneur. It's weird for me to be an employee. They are cracks and they give me the opportunity to be in the crypto world.
What is decentralized finance
In the relatively new crypto world, a term grows exponentially. Although it seems that it is becoming fashionable, behind it it entails a radical paradigm shift in the circulation of money. It is about DeFI.
What is DeFi? It comes from the concept of decentralized finance, or decentralized finance. They are financial services that work on a blockchain or public blockchains, such as Ethereum. Covers loans, investments, custody, futures. There are no brokers, banks, finance companies in between. Everything circulates through cryptographic processes.
As it is not regulated, there are no accurate numbers. But it is estimated that as of December 2020, some US$15 billion had been deposited in DeFi protocols. And that in January 2021 approximately $20.5 billion was invested in DeFi, according to MyEtherWallet COO Brian Norton, quoted in a Forbes article.
Argentina has an advanced crypto ecosystem, as highlighted by both Vitalik Buterin, the creator of Ethereum, during his visit in December, and Santiago Siri, its host and creator of the Proof of Humanity protocol.
According to data from the aggregator Statista, the country ranks sixth in the world in terms of knowledge or possession of cryptocurrencies, with 21% of those surveyed.
Statista world crypto argentina.jpgSabbatella gets excited when he begins to describe everything that can be done through smart contracts, how it could benefit millions of people who are outside the traditional financial system and how this new dynamic helps the daily life and planning of individuals. who seek to invest and companies.
-What is DeFi looking for?
-Seeks to bring financial derivative products from the traditional world to crypto. To be 100% decentralized. I mean, no one asks anyone for permission. It's all anonymous, 100% open.
In DeFi there is a lot of lending, but at a variable rate. You leave 1 bitcoin or 1 ether as collateral and they give you a loan. When you return it, the collateral is returned to you.
When you come to make a deposit or take out a loan, you will have to choose an expiration date. So you come and deposit, for example, 10,000 DAI and say that you are going to leave it deposited until December 31.
We, at Exactly, say that on December 31 when you come you will take 10,087.33 DAI. And that is the exact number that we are going to pay you, with the exact rate.
The borrower can also know that if they ask for 10,000 DAI today, they know exactly how much they will have to pay back on the closing date.
Now that's exactly. And we are planning to leave in May. Many security audits have to be met for the protocol to be secure.
-Are there minimums to operate in DeFi?
-Each blockchain has a limited capacity of transitions. Then it adjusts for price. When you trade on Ethereum you have to pay for something called gas. Gas rises with demand. Making a loan request, being an advanced operation, can cost between 150 and 200 dollars of gas.
That expense is not justified for a $1,000 loan. There is a new technology that is starting to be used, which is called Layer 2, which allows the processing to be done in another blockchain that is connected to Ethereum. It is faster and cheaper.
Once the transaction is closed, it is saved on the Ethereum network. It can be up to 250 times cheaper.
This, in combination with Ethereum 2.0, which may come out this year, can achieve much more scalability. With this, all these loans will be easier and more accessible.
-How is the proccess?
-The problem that there was historically with the issue of requesting loans is that it should just be the same amount of money and for the same term, that is, very difficult. Here, what are liquidity pools are set up. Those who want to lend DAI deposit it in the DAI pool and those who want to borrow take from this pool.
It is provided automatically, anonymously and "permissionless". You only need to leave some collateral: ether, bitcoin. It is undisposable and uncensorable.
The challenge is to bankarize the 30% of the planet that does not have access to financial services.
-In what state of progress do you see that DeFi is in Argentina?
-Argentina has the highest density of talent per capita working in crypto on the planet. By far. More than anything working for outside projects.
For example, the founders of Open Zeppelin, those of Decentraland, the programmer who made the first DeFi protocol is Argentine and his name is Mariano Conti. And there is a very important role for communities: DeFi Latam.
The impossibility of buying dollars due to stocks made Argentines grow in the use of stable currencies.
Added to this is the explosion of the Belo, Buen Bit and Lemon platforms. Everything is growing big and fast.
The meeting with Vitalik Buterin
-What caught your attention about Vitalik Buterin?
-He's a standout. He is a different. You listen to him and you realize that he is very advanced, that he really understands all the challenges that Ethereum faces.
He was asked what would have to happen for Ethereum to fail. And you realize he's not a fanatic. He sees that network not as a mechanism to fill up with money. He is interested in what can have an impact on people.
https://twitter.com/EriUehara/status/1472052983655399428The future of DeFI
-What things do you have to keep an eye on in crypto or De Fi in 3 years?
-The issue of scalability. For that, it is important what happens with Ethereum 2.0, which stops mining and is validated by proof of participation. If you scale, it's going to be cheaper and reach more people.
Then there is the whole challenge at the regulatory level. Governments are beginning to see that this is growing very fast, that there is no way to keep up with it.
Governments have a very big challenge to understand what all this is about and go out and regulate what they can regulate, because they are not going to be able to regulate everything.
Countries that know how to regulate are going to be at an advantage. Those who regulate well will attract talent and those who do it poorly will expel it. Argentina is a constant source of talent. In technology and in crypto. All the people who are dedicated to the subject make their companies abroad or leave the country.
DeFi Bitcoin.jpgThe DeFi and Bitcoin scheme seek to be the alternative to the current financial model.
The United States is trying to regulate more or less well, or at least puts people who know it as regulators, so that the companies are there. And China, on the other hand, is making a lot of mistakes.
You have to keep an eye on the regulator and also. And also in what the government does regarding the CBDC (Central Bank Digital Currencies, digital currencies issued by central banks).
Between now and 2030 the euro disappears. Between now and 2030, the dollar, the euro and the yen will disappear as paper currency and everything will become digital. When cash disappears and all digital money has a first and last name, the informal economy will continue to exist, but DeFi's role will be greater there because it will be the only vehicle that people will have to be able to operate online. out of the eye of the state.
Everything that is fixed rate is going to grow a lot, because it is inevitable that at some point the market falls sharply. Nothing goes up forever. When the market falls hard, those who studied will make a big difference.
Bitcoin, NFTs and investments
-Do you think that bitcoin needs one more resounding fall?
-Yes. But I don't know if it's going to go to $100K and drop to $50K. Or if it's going to hit $60,000 and it's going to drop to $30,000. What I can tell you with confidence is that you could easily have a 50% drop in price.
When bitcoin falls, NFTs are going to fall very hard. Because it is something that is out of fashion and there are many projects that really do not have any value behind it.
-Today, how would you put together a portfolio based on what you see?
-First is to understand the subject and what is your investment horizon. I would never invest in crypto for less than 8 years. Because of the volatility.
Another point is to know how much your risk aversion is. Do you plan to have 70% down your portfolio?
I think that you also have to have a more traditional investment from companies: Mercado Libre, Amazon. I would put 10% of my savings every month into Bitcoin and Ethereum. If after 10 years that 10% went to 0 it will not change your life.
But if it increases 20 times, which would not be unusual, you have tripled your capital.
There is much to climb and little to lose. But you have to be aware that you can go to zero and it could happen.
Mining, Ethereum and 2022
-Is mining still a business?
-I am not an expert in mining, but in principle mining bitcoin is business. And that is not going to change. In Ethereum it is estimated that between April and June it will stop looking.
If you have teams, I would continue until whatever time it is and at a time when Ethereum 2.0 comes out, what will happen is that it will no longer be profitable. And the market is going to be filled with plates. If you have to start mining today, I wouldn't get involved. No Ethereum, over there yes bitcoin.
-How do you see 2022?
-Crypto adoption is generational. You look at any survey and the younger people are the more they adopt crypto. it's a matter of time. The crypto revolution is inevitable.