GRTiQ Podcast: 195 Jeroen Develter

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Jeroen Develter (00:18):

Maybe another reason why I see Bitcoin growing quite fast or Bitcoin DeFi is that a lot of the experiments have already run in away on different networks. So Ethereum, said that as well on some of the podcasting, Ethereum has been a test net for Bitcoin, a great test net.

Nick (01:02):

Welcome to the GRTiQ Podcast. Today I’m speaking with Jeroen Develter, Chief Operating Officer at Persistence Labs. Jeroen’s journey into web3 spans traditional finance consulting and an entrepreneurial leap into the world of crypto and blockchain. Originally from Belgium, Jeroen built a global career that took him from working with major banks in Paris to founding a startup in Singapore. His diverse background provides a unique perspective on the emerging Bitcoin DeFi ecosystem, a narrative that seems to grow more and more every day. At Persistence Labs, Jeroen is working on pioneering solutions, aimed at expanding the utility of Bitcoin through interoperable Layer 2 networks and innovative DeFi applications. During our conversation, Jeroen shares his insights into the vision for a productive Bitcoin economy, the challenges of scaling Bitcoin’s infrastructure, and why he believes Bitcoin DeFi could outpace Ethereum’s DeFi ecosystem. I started the conversation with Jeroen by discussing his upbringing in Belgium and the early influences that shaped his interest in finance and technology.

Jeroen Develter (02:16):

First of all, thank you so much for having me. Very glad to be here. Yeah, absolutely. So I’m from Belgium originally. I basically grew up there in a little town called Austin. It’s like a beach town, beach city, I must say. It’s one of the bigger cities in Belgium. Yeah, I think Belgium is a nice place, but it’s pretty small. So after I actually graduated in Belgium, I studied actually in the University of Leuven, studied business engineering. Actually tried to go and explore the world a little bit, so I chose a career that matched into that desire to explore the world, and I started working in traditional finance consulting.

(02:50):

Went to Paris for a bit, actually did my exchange when I was studying in Hong Kong, and so yeah, worked in Paris for a bit and then moved away to Singapore for multiple years. After six years in Singapore, actually moved to Portugal for the last three years now. Looking actually at moving back to Singapore at the end of the year and go and explore a bit more actually on that side of the world. So yeah, I’ve been quite global, I would say, but today dialing in from Portugal.

Nick (03:16):

So I’ve had the opportunity to interview a lot of people on this podcast, and there’s a lot of various and diverse backgrounds of people that enter and start working in web3. One thing that makes you unique as I think about all the other guests is you’re a retired boxer. What can you tell us about your boxing career and how long you did that?

Jeroen Develter (03:35):

I am indeed a retired boxer. I am one and oh, I just want to state that for the record, I did one fight and I thought it was enough. I’ll give you the full story. So it was back in the days in Singapore, it was this thing called white collar boxing. I think it’s still quite a popular thing across the world actually, where people in white collar jobs participate in a boxing and a training camp for multiple weeks. It was three months or three and a half months, basically very intense training people who’ve never done boxing before. The main objective there was a charity event. So at the end of the three-month period kind of ends with a charity boxing event in which there were multiple fights, and that was one of these bouts and trained very hard for more than three months to become a boxer and did one fight, one, and then decided that I didn’t want to step into the ring anymore.

(04:20):

I actually liked the training part of the boxing. I think it’s nice to really be challenged and be forced to really adapt, really train hard, get to spar even with people, get hit in the face taking all these things like putting yourself in uncomfortable situations, and it was actually a great journey, honestly. It was really fun and it was great for charity. I think we raised $150,000 or so for a children’s hospital in Cambodia. It was a beautiful couple of months journey, but no more boxing for me on that level.

Nick (04:51):

Amazing. Well, you’re fully undefeated and you might be the only undefeated boxer I ever meet. That’s a great, great insight there. You mentioned as you graduated from university, you went to work in traditional finance and consulting. You worked at some large banks, work with some large firms like Accenture. What did these early experiences in consulting and trad fight, how did that shape, I guess, your thinking about your career and what you wanted to do with your life?

Jeroen Develter (05:16):

I think it was a great starting point. I think when you come from educational background and you go kind of dive into the world, there’s a lot of people say, I want to work in a startup, and they know from the beginning. For me it was like, actually I want to start in a corporate and see how things go in the corporate world and learn from that. I think for me it was mainly learning in a way because I know once you start your entrepreneurial journey, it is going to be a more expensive learning curve, I think. So it’s actually good to go and learn within these corporates, which is a bit more of a safe environment, I would say to learn. I’ve always been kind of entrepreneurial to begin with. Even when I was a kid, there was two things in my life, actually three. I think sports was one and then it was tech and then some sort of entrepreneurship and trying to combine those.

(06:04):

But I’ll give you an example. I was always first one to figure out how to clone games on the Wii and then sell those on the playground and things like that. So I wonder it was Wii or DVDs or stuff like that. So that bit of entrepreneurial spirit was within me, but I still thought it was best to start off a career in a more traditional way and then learn in the bigger corporate. So started as a consultant for Accenture, which was combining the tech aspect and the business aspect of what I studied in good learning curve, but it was maybe a little bit too corporate. It was a huge company. I think when I joined, I was employee number 200,000 or something, which was not really that fun. I mean, it’s still fun, but I think too big for me to be really that engaged in a way with everyone.

(06:50):

So joined a smaller, more boutique type of consulting firm SEER Partners, which actually I thought was a great experience. It was great fun to work with a slightly smaller team. At that time, I think I was employee maybe three or 400 or so globally, but within Belgium I think there was only 15, 20 people. But then I didn’t work in Belgium for very long with them. I actually went to Paris. I joined the bigger team there and worked for pretty much all of the bigger banks that were around at that stage. That was great experience I think because you get to know how banks operate, how big they are. They’re a bit slow, which is I think a good insight to have. It is true compared to what we do now. Through that, I’ve always been kind of between the tech and the business side of things. So I have a very deep understanding of the financial side of things, but I have that deep and keen interest on the tech side.

(07:40):

So I’ve always played that role to connect the business and the tech side and played that, how do you say, product management type of role to figure out what’s the best way to develop products going forward. So I did that in Paris for more than two years and then decided that it was time to go back to Asia where I spent quite a bit of time for my exchange back in the days. So I moved to our Singapore office of the same consulting firm, worked for a bunch more banks, always a little bit slow, and I think the main thing that was for me, the point of wanting to change to something else was the lack of entrepreneurship and get through daily activity in a way that was really exciting. It’s more of like a day-to-gay, every day is the same type of thing. I wanted to do something more entrepreneurial again, so I joined another startup, which was just literally founded and it’s in fashion tech, so you really haven’t heard that too much either.

(08:42):

Basically joined a startup as the third guy within team of two co-founders that focused on fashion tech. So basically what does that mean? We were bringing tech more to a fashion industry. When I say fashion, it’s about suits that are made to measure for men. So it’s suits and shirts, basically custom-made clothing made accessible through tech. Did that for six years actually in Singapore, we’re actually nominated as one of the top 100 or top 300 fastest growing companies in Asia and in Singapore for two times in a row. So that was quite fun.

(09:16):

But then when COVID hit, we were selling suits, which typically is for weddings or for business attire. During COVID, there was not that much demand for the product because no one was getting married, no one was going to the office. So I was a bit at a slow point then. Business still ran and then still exists, but for me that’s when I lost a bit of interest because it was slowing down and I always need something that’s really fast-paced and exciting, and that’s when I started to look back at crypto. I looked at it a bit earlier as well, but that’s really when COVID hit. I really thought this is a time to really pick up the pace on the crypto side and really dive in heads first now that I have a bit of time on my hands because business is slow anyway. So yeah, that’s how I got into crypto. I’m not sure even that was the question, but I got to it.

Nick (10:04):

Yeah, it’s great. What were your first impressions of crypto? You mentioned that it was sort of COVID when you returned to it, but you had come across it before. What were those early experiences like and what was your perception given the fact that you were working in TradFi and working in consulting?

Jeroen Develter (10:19):

So my very first interaction with crypto was actually very early. It was like 2009, I believe. Bitcoin literally just launched, and I realized that you could actually mine it on your laptop, the Bitcoin mining, which I figured out. But back in the day, I had no clue what it was. I just learned about it and I saw, okay, this is cool. You can do this and you can earn some free tokens, whatever by doing this on your laptop or on your own computer. But I never really understood the concept behind it. So for me it was just part of something where you have to try it, but then left it behind for what it was, never came back to it until 2017. So really left it out. It was never even realized about everything that I left behind.

(11:06):

So in 2017, I think that, I mean, crypto started to pick up again a bit more mainstream, and I just looked at it more from an investor angle. I was very busy at the time with the business, the fashion tech business, but a little bit of investing on the personal side here and there, which I think was for me more than enough to be in crypto at that time because I wanted to build out the other business that I started in. But then as I said, when things started to be slow and in COVID, kind of thought it was time to take a next step and go even further into crypto, which was quite exciting. It’s exciting, but on the investment side, didn’t make money at that time. We obviously made money, but then lost it all. I think that’s typical for people’s first cycle. You have to lose it all to have the right to do it second cycle, right? Yeah, that’s how I got involved in crypto. And then yeah, 2021 really started to look for a job actually.

Nick (12:34):

Let’s talk a little bit more about that. So how would you explain that path you took then to finding opportunities to go full-time and working in crypto and web3?

Jeroen Develter (13:14):

I think it was first of all, trying to figure out what do I want to do within this industry? It’s a big industry. It’s like coming up and it’s not like everyone has a job there or everyone knows how to introduce you to the right people and stuff. So for me, it was a lot about learning. I did a lot of learning self-study, trying things out and really go around the different ecosystems that there are, figuring out what’s most interesting for me at that time, where can I actually make a difference? What would fit well within my experience as well? So looked around and various things. Eventually was very interested in Ethereum. I think the part they had to proof of stake, I think that was very interesting. With that also came across Cosmos, the Cosmos ecosystem.

(14:02):

And for some way, I don’t know whether it’s serendipity in a way, kind of reconnected with an old colleague of mine from SEER Partners who when I left SIA Partners, he left shortly after that and he actually went into the crypto industry, started his podcast actually back in the day, and then joined Crypto Venture fund arm and reconnected with him in a way. And then he was the founder of Persistence. So one thing led to another, he realized that actually was very keen and eager to join industry. I had a couple of ideas on things to work on, and it got me to join his company. We’ve been working alongside ever since, has been a great journey.

Nick (14:44):

How would you explain to somebody who’s listening to this interview, or maybe it’s like a friend or family member, in fact, maybe you had to do this at some point in your life, but how would you explain someone with your education, your experience in TradFi, you’re working in consulting, you’re working at notable firms. Why would someone like you leave all that sort of security or credibility of that industry and that work to work in something that seems so new, a nascent industry like crypto? What’s the explanation?

Jeroen Develter (15:13):

I think it’s the urge to do something new and exciting and bleeding edge when it comes to tech. Sure, security is nice, but to me that’s not really entrepreneurship. And entrepreneurship is often about finding new ways and new things, and that’s, to me, what excites me. I often say this, if things are too comfortable, it means you’re not moving fast enough. That’s really how I felt at that point is like, look, this TradFi thing, sure it’s comfortable, but to me it’s not moving fast enough. So I like the speed and then the fast-paced environment that the industry brings, and it’s something new. If you would ask people back in the days, it’s like, would you want to be part of the dot-com boom in a way, or do you want to launch an internet company? A lot of people would’ve said, no, that doesn’t excite me. If I was there back at the day, I would’ve probably also said, oh, that’s super interesting. I just like the unknown in a way when it comes to business figuring things out. And that attracted me.

(16:13):

And I think with that, the enormous potential of what we’re doing here in this industry when it comes to breaking with the things that we know from traditional finance, traditional banking, making things more open, more decentralized, more transparent in a way, I think those are all kind of values that I believe in quite well. And yeah, it resonates with me and I think it would be nice to be and play a big role in that future of finance. Look, I still think the future of Bitcoin is enormous and potentially the Bitcoin economy will be the biggest economy in the world one day, and it would be nice to have a say in that, or not even a say, but just some sort of a contribution to that. And I still believe that that’s very much a plausible outcome where Bitcoin is the basis for everything that is like an economy.

Nick (17:05):

Well, as you mentioned, you joined Persistence Labs in 2021 and you worked there presently as Chief Operating Officer. For listeners that aren’t familiar with Persistence, what it is, what it does, could you share a little insight, top level introduction?

Jeroen Develter (17:20):

I’ll try to explain very simple. So Bitcoin is a network, is a cryptocurrency network that is quite famous for doing transactions, but it’s also famous for being quite slow and expensive to transact on. So people are trying to bring scalability and programmability to Bitcoin. So similar to what they’ve done on the Ethereum side, really bringing smart contracts to the network, that’s now happening on Bitcoin. So people are expanding the possibilities on Bitcoin. And with that, a lot of Bitcoin whats called Layer 2s are created, so there’s different blockchains that are created to solve the problem of being slow and being hard to do anything on. So now what we solve is that’s obviously great, that’s solving a problem of scalability.

(18:08):

Now that solving of that problem of scalability actually creates new issues. It creates a fragmentation issue, is what we see. So there’s pockets of different networks, different blockchains that are now building on top of Bitcoin, which is great, but each of these little economies on top of Bitcoin, they’re not really connected to each other and that’s actually what we do. We actually connect these little networks or blockchains, which are natively not really talking to each other because each blockchain, it lives in its own, it doesn’t really talk to any other blockchains, not natively without specific infrastructure. So we come in and we provide a bridge between these networks to transfer BTC or Bitcoin from one network to another. So I think that’s as simple as I can explain it is kind of bridging Bitcoin between different networks that are built on top of Bitcoin.

Nick (19:03):

I’ve had a bunch of guests on the podcast that are working in that L2 space in Bitcoin and a couple other sort of service providers that are focused on the Bitcoin ecosystem. I want to ask you this question that I’ve asked them, which is sort of this reemergence of Bitcoin from the perspective of programmability. We had the ordinal thing that sprung up, that all happened I think at the front of this cycle, if we’re even in a cycle. Where did that come from? You were front row to that. How would you explain that reemergence and interest in Bitcoin is something that people could build on or program?

Jeroen Develter (19:41):

I think that the main reason is actually the Taproot upgrade, I think which happened in, is it 2021? I don’t remember exactly, but basically the Taproot upgrade allowed Bitcoin to be a little bit more efficient in a way it handles transactions, it handles data in a way. And with that out of Taproot, even after Taproot the upgrade, it still took I think two years for Ordinals and Runes to be created last year, with 2023. So yeah, I think 2021 was Taproot. I see the small is obviously big. There’s a lot of health debate that went into that Taproot upgrade for sure. It was a way for the Bitcoin ecosystem to somewhat address the things that they saw on the Ethereum side where Ethereum was really gaining a lot of steam, a lot of adoption when it comes to programmability, DeFi and all of these things. So Taproot was a little bit of an answer I think to that.

(20:33):

But yeah, then you have, so Ordinals and Runes kind of was the first layer of innovation that was showing that Bitcoin has further options than just being a store of value, or just digital gold. Now with Ordinals and Ruins, you can actually have NFTs and you have actually different types of tokens that can be traded on Bitcoin. So Bitcoin, the network is more than just a store of value. So that’s the origin, but I think it’s even now been taken further by a few other innovations. So I think ZK Tech, so zero knowledge proofs I think are becoming more and more adopted in a way. I think it’s quite an important piece of the puzzle for networks that are trying to put a whole bunch of data very, very condensed into these Bitcoin blocks.

(21:22):

Because Bitcoin blocks are very small. You can’t put a lot of data in it. And also there’s only one block every let’s say 10 minutes or so. So you have to be very, very limited in terms of the data that you put on. But still, once you put it on there, you want to be able to verify all of the transactions you’ve complied into that block or the history behind it. So ZK Tech definitely helps there to make it more scalable. And so with that, I think there’s one other part there is the search for yield in a way for Bitcoin has truly begun now with, there’s a few protocols that are looking into Bitcoin staking. I think Babylon is a very famous one. I think their TVL now is 1.5 billion or so, but they’ve capped it actually at the moment for their launch.

(22:09):

So what it does is basically allows you to lock up your Bitcoin so that you can use it as a form of security to secure other protocols or chains who then can create some form of a yield on your Bitcoin because they have to pay for the security. So I think a combination of these factors, so you have the ZK tech, you have the step root upgrade, which enables a few more things. You have actually, there’s BitVMs a tech that is quite nascent as well, allows for some sort of smart contract development on top of then you have all these Layer 2s that are now able to leverage the security from Bitcoin. It all comes together in this cycle. It’s really like 2020 or this year actually that it’s really been sparking up and I expect to see a bigger push actually next year. A lot of these L2s are still very early days. Some of them still have to go live. Yeah, I’ve been very excited to see what’s coming.

Nick (23:07):

I had the opportunity to interview Charlie who for Episode 175, he’s one of the co-founders over at Bit Lair, and we talked a lot about BitVM. So a long time listeners of the podcast are already familiar with some of those concepts. You mentioned earlier that you had early insider vision for the impact that Bitcoin could have in the world, and you continue to have conviction for that. And I’m just wondering, how does something like Bitcoin defi and the emergence of L2s and all the things that you’re working on at Persistence, how does that sort of inform this vision you have for what Bitcoin could become? Because I think early on it was just a store of value and that was sort of the perception, this strange store of value internet money, but your vision seems to be much more expansive. Talk to us about that.

Jeroen Develter (23:55):

If you look at Bitcoin the asset, it’s now one of the top 10 assets in the world. I think in terms of size, it’s 10 biggest asset in the world, but it’s not productive. It’s an asset. People see it as a store of value similar to gold and silver who are both in the top 10 as well, but they are still not productive and they don’t really have any capabilities of becoming a real productive asset. Sure, you can probably get some yield on gold or silver if you use it as collateral and you use some other options maybe, I don’t know on gold, probably make it somewhat usable or productive. So with Bitcoin, it is a digital currency. It’s top 10 in the world now, and we haven’t even started at exploring what if we build a real Bitcoin economy around this.

(24:43):

If you look at the other assets in the top 10, most of these are companies. These companies have products but so many different products. They have real world value, they have an economy around it like it creates employment, it creates dividends for shareholders. There’s an entire economy going around these assets. These are all productive assets. And Bitcoin is not yet that and it’s already in the top 10. So for me it’s like how can we make this asset which is already top 10, how can we actually make it more productive? Which typically means how can we generate yield on that? If you hold Bitcoin now, how can you hold more Bitcoin in the future or how can you make that a source of wealth in a way where if you hold it, you earn something?

(25:28):

And to me, that entire DeFi narrative or the entire DeFi ecosystem is a way to actually make that productive. That’s why I’m so bullish on it because we know DeFi works, we’ve seen it on Ethereum, there is interest, there are a lot of people using DeFi products every day. I think it’s still early days, but eventually a lot of the current world infrastructure, even when it comes to money and finance could actually run on crypto rails I would say, because the traditional banking system, sure it works, but it’s not that efficient. It’s not that transparent, it’s not that open for anyone to join. It is quite limited. You have to have a bank account. So it is a whole lot of problems with the traditional finance system and I do think with DeFi you solve those and I think with the asset that Bitcoin is, the size, the mind share, I think it’s huge potential there.

Nick (26:25):

You said in another interview that you actually think Bitcoin DeFi could be a lot bigger than DeFi on Ethereum just because alone the Bitcoin size of market is much bigger. I’m just curious though if there’s other reasons that we might sort of think that that might be true. So if we subtract out the fact that the total available market for Bitcoin might be much larger than something like Ethereum, are there other reasons why Bitcoin DeFi might be able to outpace and replace sort of that Ethereum DeFi ecosystem?

Jeroen Develter (26:58):

I think the main reason for me is mindshare. Look, if I say anyone who is not in the industry, I say, look, I’m in crypto. Oh, crypto is Bitcoin, Bitcoin is crypto, and people don’t really look further than that. So I think mindshare is the number one reason that it could work. I think maybe another reason why I see Bitcoin growing quite fast or Bitcoin DeFi is that a lot of the experiments have already run in away on different networks. So Ethereum, said that as well on some of the podcasting, Ethereum has been a test net for Bitcoin, great test net, but now everything can actually be adopted even faster on the Bitcoin side. I think those things probably would help to really make it grow faster and bigger than anything we see now. But yeah, I think it comes to mindshare adoption, overall acceptance as well. It seems like also with the ETFs and stuff, you see Bitcoin is accepted as an asset now. ETH share a little bit as well. There’s also ETH ETF, but all the other assets not yet.

(28:00):

So I think it’s just miles ahead and I’m not sure if it will be losing that dominance. Bitcoin dominance is I think 60% or so. That means that 60% of all crypto assets is actually Bitcoin, which leaves 40% to the rest. And I actually do believe that eventually Bitcoin dominance will probably continue to go up for even longer as Bitcoin now allows for programmability and scalability as well. It was always like Bitcoin has never focused on programmability and scalability in a way that was very clear. It was all about distribution, adoption, more going mainstream, right? Ethereum was very clear. It was all about, they focused on programmability, not even really on scalability because even Ethereum as it was back in the day, not really scalable. Now with all these L2′s it is. So now I think Bitcoin took a more decentralized approach from the get-go and the more focus on distribution and really community adoption and stuff, and now they focus on that programmability. I think that’s the right order of things.

Nick (29:03):

You and the team at Persistence have been working on some pioneering solutions related to intents based architecture. Intents have come up on this podcast a couple times over the years, and when it does, there’s high conviction for how important something like Intents are for unlocking more value, more adoption, better transactions through DeFi. I’m not sure I fully understand Intents quite yet. What can you tell us about what you’re building there and why it’s so important?

Jeroen Develter (29:31):

Yeah, sure. Intents, obviously people don’t really know what it really means. It’s a simple word though, Intents, but it’s not always clear what it means. But to me, intents is just, it’s a way of being able to express what exactly you want and then getting that done in the way that you don’t really care how it gets done. So I’ll give an example that I’ve used to explain it to people who are also not familiar. So let’s say if you order something on Uber Eats, I’m sure you’re familiar with Uber Eats, you order something, let’s say you want to have a spaghetti and you’re hungry now and you’re okay to get that spaghetti from that particular restaurant in let’s say maximum 30 minutes. So that is your expected result. That is your intent. I want the spaghetti in 30 minutes delivered at this address and it needs to come from this restaurant. So this is your intent.

(30:22):

Now, how Uber finds this driver to pick up that spaghetti, how this guy makes the spaghetti. Obviously you hope it’s correct and according to the recipe, but how Uber gets someone to pick it up, which route he takes on his motorcycle and on his car, but if he uses a motorcycle or a car, you don’t care. As long as it gets delivered within your expected timeframe, you’ll be happy. And that’s kind of what intents do. Currently in crypto, it doesn’t really work like that because of the way blockchains work and you have always limited block and then blocks don’t really communicate, so everything needs to be finished within a block. It’s quite hard to achieve that, especially when you start trying to look at things between different blockchains. So especially when it comes to bridging, you want to go from one asset on one chain to another asset on another chain, you would have to define the entire process of how exactly do I bridge that token from this chain to the other?

(31:21):

There might be a few steps in between, but you as a user, you should actually not care about that. What we want to do is we want to abstract away the complexity from the user, and you just want the user to tell us, look, I want to trade token A on chain A for token B on chain B. And that’s like what I want, this is my intent. Obviously you’ll see some quotes and you’ll accept the best quote typically for getting that fulfilled, but how it happens in the background, you don’t care. And that’s kind of what intents are. And for us it’s a huge unlock when it comes to user experience. It’s like a UX play of sorts where, and you can even do multiple steps.

(32:00):

Even if you say, look, I want to trade from this token to that token, and then after that I want to deposit this token into that protocol to do this action, all of that, you can actually, it’s a simple, you can package that in one intent. You say, look, this is what I want to do, and someone else can actually even deposit it on your behalf in that protocol so that you can really, really just focus on the core thing, which is building the front end, which is very simple for user that allows them to submit what exactly they want. That’s really what intense is about.

Nick (32:32):

You mentioned that these are sort of early days for Bitcoin DeFi, and as I mentioned earlier, I’ve had some guests on the podcast before that have talked a little bit about this. There’s been this remarkable emergence of activity interest in Bitcoin outside of just this store of value thesis. Can you just give a little more insight on where we are now, the types of Bitcoin DeFi that exists, the things that people can do, and then what you think happens next? What’s the big next milestone in this context that people should watch for?

Jeroen Develter (33:08):

It’s still quite limited at this moment, I think what you can do. When I talk about BTCFi actually went how I kind of described the term, it’s Bitcoin powered decentralized finance. So for me it’s actually quite wide. Maybe it’s a wider definition than what many people have. When they say BTCFi, sometimes they think it needs to be DeFi on top of Bitcoin. So that’s slightly a different definition, but for me it’s a bit wider. So if you use Bitcoin, the asset in any DeFi protocol, to me, I call that BTCFi. Currently we’ve seen actually some of that on Ethereum, so is WBTC the bridged version or the wrapped version of Bitcoin on Ethereum. It’s used in DeFi, but it’s quite limited. It’s less than 1% of the Bitcoin supply that is used on Ethereum. There’s a few other chains that have similar things. Right now you have OnBase, you have Coinbase BTC, which is starting to get used in DeFi. You have BTCB on Binance. To me, those are also part of the BTCFi and ecosystem.

(34:15):

But I think where the real unlock comes from now is to actually, instead of bringing these different assets to places where the tech was actually enabling DeFi, so these different chains like Ethereum base, maybe other chains as well, now bringing the tech to the asset itself, because that’s still where I think most people care about Bitcoin is the security that comes with Bitcoin and Ethereum or acting with your rabbit BTC on Ethereum does not have the same security guarantees as acting on a true Bitcoin Layer 2 with your actually different form of Bitcoin there. So I think that’s a big unlock. So kind of bringing the tech to the asset, I think that’s one. Another big unlock in my opinion is, so what Babylon is doing, what our protocols are doing is this Bitcoin staking is making Bitcoin yield bearing in a way. There’s currently a few ways of making money off your Bitcoin.

(35:16):

One is as similar as with what I mentioned with Goa. You can lend it out, you can use that collateral, but now if you can stake it as well, it’s another vertical of sorts to make your Bitcoin yield generating. I think that’s another unlock. I think the combination of these things is just what is the potential, and I think the coolest thing that we’ll see will be around forms where you can reuse some of that Bitcoin. So let’s say you stake your Bitcoin, you get yield on it and you get a representative token as collateral that you can use as collateral. You put that in a borrowing lending protocol and you can for example, lever up a little bit. So you borrow more USD to buy more Bitcoin, which you can stake again. So you can do leverage liquid staking on your Bitcoin.

(36:02):

I know it’s quite complex, but instead of having two or 3% yield, maybe on your Bitcoin, you can now get 10%. Obviously you take a slightly bigger risk because if Bitcoin price goes down significantly, you might get called on your loans. But I think it’s a very interesting concept. So you can do that. Obviously, I think just only borrowing lending itself I think will be a huge unlock. So there’s $1.5 trillion almost, it’s just sitting there, but you can’t really use it. You can’t borrow against it. But with DeFi really coming into these next stages, imagine you can now borrow USD against that and you don’t have to borrow the full amount. Let’s say even you borrow 20, 30%, or let’s say you borrow 33%. Let’s say 33% of all Bitcoin is used as collateral. Let’s say that’s half a trillion, let’s say $500 billion used as collateral to now borrow. And then you have additional money that can flow into other things. It using a bit of leverage on top of Bitcoin, just make it more productive and to make that asset more valuable in a way, if that makes sense.

Nick (37:15):

So I want to ask you this question that harkens back to your experience in consulting and working in TradFi, but let’s assume for example, that the crypto spaceis more centralized than it is today, and there’s a way for you as a consultant to kind of come in and shake the industry, what it’s going to do next, what it’s going to focus on. So this is obviously just a thought experiment here, but assuming that that was the case, and you were to hired to come in and sort of grow this thing to get it to mass adoption, the next big unlock for greater use, greater interest, what would you focus on? What would you advise, hey, crypto industry, the best place to start driving greater adoption is here? What would you say?

Jeroen Develter (38:01):

I like the question, very original question. I haven’t heard that before. My first thought is that instead of doing more, I would actually try and do less as an industry. There’s a whole bunch of stuff that the industry has taken and pushed, which I think is conflicting a little bit with what we’re doing. And it hurts itself. I’m talking about all these meme coins, all these scams, all these issues that you have with the industry. No one takes it seriously just because of those things. So if I would have a magic hand in a way to shape the industry, I’d probably do away with a little bit of that. I think you need some for the culture. I think memes and NFTs and stuff are good part of the culture and for people to feel part of the group. But I think it maybe has gone a little bit too far and especially all these meme coins and all these scams, and I think it’s a bit too much for the reputation of our industry. I think that’s once doing less on that front.

(39:05):

When it comes to doing more or focusing on wanting, I would say it’s education. I think education towards the, I think the masses is maybe a big word, but I think people still don’t really know what it’s all about until they really come into trouble. Recently I was traveling, I was sitting in a restaurant and some people next to me started talking about how their banks locked up their funds because they were moving, one document was not signed or whatever it was, and he was talking $10,000 was frozen in the bank. And we started interacting at some point, I can’t remember exactly how it happened, but started explaining about Bitcoin and the free, no one has access to your money. If the bank tomorrow decides to say that you’re not a customer or you’ve never been a customer, what are you going to do? If the government tomorrow says, well, actually you have no right to have a bank account with this bank, what are you going to do?

(40:05):

But with Bitcoin, at least you have some of these guarantees that, look, if you have the key to this wallet, it’s your key is you keep it secure, it’s your money in a way. And it’s like those values, I think people don’t think about it enough. People take it for granted that yeah, there’s banks and these are safe, and these are acting in my best interest. And sure that could work in many countries, but in many countries it’s not the case. And even in times of severe distress in certain countries, you’ve seen it, here the government says, okay, you can’t withdraw your money anymore. I feel already in Portugal, here you’re allowed to withdraw 200 euros at a time from the ATM, which I think is like, it’s a constraint. And I’m sure you can do multiple ATMs, so we have multiple transactions, but it’s like, hey put this limit, it’s my money. If I want to withdraw more than 200, I should be able to.

(40:59):

And these things, I think to me it’s a bit of education and making people understand why a lot of us are working in this industry. I think that would be a good thing to work on. And then again, going back to intents is just making things simpler. When it comes to UX, like user experience, it is too complicated. A lot of the UX is very basic within crypto. It’s just very quick. And yeah, it’s not really inviting for users to come aboard. It’s not easy as well. All these different wallets, all these different chains, we need to abstract that complexity away. We need to bring it to mobile at some point, which is also not easy because it comes with a lot of issues on the security side as well. But yeah, those would be probably my things. It’s like education and making it more user-friendly and using Intents to do that probably.

Nick (41:55):

You’ve sort of alluded to this, but I want to ask this question formally, which is having spent so much of your time as a consultant working deeply in TradFi and the banking industry, obviously that’s an industry that’s primed for either disruption or just greater adoption of something like Bitcoin. When you look back on those days, do you see gaps in that business model of traditional banking, traditional finance where you’re like, oh boy, what’s Bitcoin sort of get some traction there? It’s going to totally change things. Or do you have the opinion that it’s already being adopted and we’re seeing early seeds of what that’ll look like in the future?

Jeroen Develter (42:38):

Yeah, slightly tricky. The thing is with the banking system, it actually works. It works kind of. For most day-to-day activities it works and people are not even looking for alternatives because it actually does work if you have the regular use cases, which are mostly covered by most of the banks and most of the countries. And if you live in one of those countries that is fortunate enough to have most people banked, you’ll probably be okay. You don’t need something else that is better, even if it is maybe 10 x better. I don’t know if it’s a 10 x better at this stage. Typically, when it comes to disruption, we’re talking making things like 10 x better. That’s a tricky one.

(43:26):

I’m sure it’s better. Is it 10 times better than the current banking system? I don’t know. Hard to say. I would say so, but not everyone is convinced about that. And that might take a bit of time. And then typically it’s what I say is people have to run into issues to realize, so actually this is now great, but I think the longer time horizon, more and more issues will come up.

Nick (43:51):

Jeroen, now I’m going to ask you the GRTiQ 10. These are 10 questions I ask each guest of the podcast every week, and it’s an opportunity for us to learn some new things from you. I always hope that listeners will learn something new, try something different, or achieve more in their own life. And it’s always fun to get all these great answers. So are you ready for the GRTiQ 10?

Jeroen Develter (44:12):

Let’s do it. Let’s do it.

Nick (44:24):

What book or articles had the most impact on your life?

Jeroen Develter (44:28):

Yeah, so for me, there’s actually just two. One is Atomic Habits by James Clear. I think I’m a very methodological person in a way. I just like my daily habits and trying to improve on a daily basis. I think step-by-step compounding over time I think is a great way to improve. And the other one I really like is Outliers by Malcolm Gladwell, which I read long time ago, probably like 10 years ago. But it’s still, sometimes it comes up. And I think it’s more about, sure these atomic habits in a way are very useful, but a lot of success also comes from being in the right place, the right time, the right circumstances. So I think a combination of these two books is probably how I think about many things actually.

Nick (45:14):

Is there a movie or a TV show that you think everybody should watch?

Jeroen Develter (45:18):

My favorite TV show I recommend to everyone is Curb Your Enthusiasm. But I’m not sure if everyone will like it, but I do think it’s an interesting form of humor, which I really enjoy. But yeah, could be an interesting one.

Nick (45:32):

If you could only listen to one music album for the rest of your life, which one do you choose?

Jeroen Develter (45:37):

So you’ll be surprised, I actually rarely listen to music, very rarely, and I actually should listen more often. But I would probably go for something like classical music, a top 50 best classical music hits or so because it’s something that for me works at any time. I used to listen to classical music when I was studying back in the days. Even when you’re working, I think it’s nice. Even if you are working out, I think still works. So for me, it’s like timeless in a way classical music.

Nick (46:06):

And how about this one, what’s the best advice someone’s ever given to you?

Jeroen Develter (46:15):

Quite blunt, but it is like you’re going to die. If you keep that in mind every day, I think you live slightly differently. It kind of forces you to think, okay, every day can be the last one. So make sure you live life to the fullest in a way. And yeah, I think you’re going to die is very powerful piece of advice.

Nick (46:35):

What’s one thing you’ve learned in your life that you don’t think most other people have learned or know quite yet?

Jeroen Develter (46:43):

I think for me it’s the power of consistency. Being able to continuously do things and saying you’ll do something and then actually do it. And doing that over and over again and to build reputation for yourself, I think kind of goes back a little bit to these atomic habits as well. It is like consistency, compounding effect, I think that for me is something I realized a lot of people haven’t figured out. You see people doing something once and say, okay, now I’m done with it. It’s not how it works.

Nick (47:16):

And how about this one, Jeroen, what’s the best life hack you’ve discovered for yourself?

Jeroen Develter (47:21):

It’s one of the laws that I come back to is like Parkinson’s Law. And I’m not sure if you’re familiar with it, but it states that work expands to the amount of time that you give it to completion. And I think for me it’s the life hack that this works on yourself, but also for other people you work with. So if there’s a task that is quite simple to execute, don’t give yourself two days to do it. Put a deadline for yourself. Same for people you work with. Give strict deadlines, obviously reasonable, both for yourself and people you work with. And you’ll get so much more done. Because otherwise you start procrastinating and everyone kind of procrastinates in a way and just takes as much time as they’re given.

Nick (48:04):

Jeroen, based on your own life experiences and observations, what’s the one habit or characteristic that you think best explains how people find success in life?

Jeroen Develter (48:14):

I can only say one word and it’s on the screen. Persistence. It’s the name of the company. It resonates very well with me, actually. Well, there’s no video in this, but I have it even on my wall in terms of my main values. I think just persistence I think is very underrated. I think you need persistence for finding success in life.

Nick (48:36):

And then the final three questions are complete, the sentence type questions. So the first one is, the thing that most excites me about the future of web3 is?

Jeroen Develter (48:47):

The potential for creating the Bitcoin economy.

Nick (48:50):

And how about this one? If you’re on X or Twitter, whatever anyone calls it, then you should be following?

Jeroen Develter (48:56):

Sahil Bloom. I really like the content he puts out.

Nick (49:00):

And then the final question, I’m happiest when?

Jeroen Develter (49:04):

When I can spend time with the people I love, like family, friends, kids, wife, things like that.

Nick (49:18):

Jeroen, what an incredible opportunity to meet you, hear your story, and get some insight into all the things that are going on the Bitcoin ecosystem, as well as BTCFi and the future of Bitcoin DeFi. If listeners want to stay in touch with you, follow things you’re working on as well as connect with Persistence Labs and figure out how to plug into that ecosystem, what’s the best way for them to do it?

Jeroen Develter (49:39):

The easiest way is Persistence.one the website on which you’ll find the link to all the socials, all the telegram, discord, all the places where our community is active, and obviously on Twitter or X, our handle is Persistence1. So yeah, there you’ll find everything you need to know about us and how we move the needle on the Bitcoin ecosystem.