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Brian Armstrong

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165

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2022-07-29

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2022-07-29

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1. “People basically just try more stuff because they're like, if I do good for other people, I'll get to keep part of it for myself and I can improve my lot in life and for my children and my community, whatever. So I realized when I read the Bitcoin white paper a long time ago that at least I had a hunch at the time. I was like, this might be a really powerful piece of technology that can inject”

   2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

2. “If you give people good property rights and rule of law and allow them to trade, it basically encourages them to do more good stuff and the whole society benefits. One of the things you may have noticed growing up in various places you did or I spent a year living in Buenos Aires, Argentina that went through hyperinflation. And there's a certain pessimism that can creep into countries when they don't have economic freedom, which it's basically like everyone has this bit of this vibe, which is like Don't stick your head up, you know, don't try too hard because it could all be gone tomorrow. Like the things that really are valuable in life are just family and friends and the past was better than the future will be. And so you don't really, people don't try as many, they don't try hard because you're not really sure you can actually keep the upside of your labor if you try hard. So you just don't try as hard. Whereas in America historically, you know, or high economic freedom countries.”

   2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

3. “Yeah, so economic freedom is this term kind of like GDP that economists use, and it's basically a measure of different countries around the world. It looks at things like are there property rights enforced, is there free trade, is the currency stable, can you start companies that you want to start and can you join the ones you want to join? And is there corruption and bribery prevalent or is it relatively free of that? And so this, there's several different organizations that basically score countries by economic freedom. And the really cool thing about economic freedom is that basically it positively correlates with things that we all want in society, like not only higher growth of the economy, but also things like higher self-reported happiness of citizens, better treatment of the environment, better income for the poorest 10% of people. And it negatively correlates with things we don't want in society like corruption and bribery and war, even and things like that. And so it's this pretty crazy provocative idea, which is that”

   2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

4. “Nobody had three years of experience with it because it had only been around a few years. So, yeah, we were finding people from adjacent fields. There's a certain personality type of people who are willing to join early companies because they have no structure. You can't really commit to them about you're going to have this team or this boss or whatever. Like everything's in chaos and flux. So it takes, yeah, hiring is one of the hardest things in the early stage for sure. You got to find people crazy enough to join you on this journey”

   2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

5. “Well, let's see. I mean, so the first person we hired was just like, we need to solve customer support. So we brought someone in to do that because we were all staying up till midnight every night trying to do customer support. And then we got more engineers. And then I think maybe the sixth hire or something like that was a recruiter because that turned out to be, you know, you need to build, hire the person who can hire more people. Yeah. That turned out to be a great force multiplier. And then you go on down the list, you eventually want to hire some more senior people. We needed legal and compliance. We need that really badly because there's all kinds of questions about what the legality of it was.”

   2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

6. “Right. I mean, it was like a cheap hack, but that was like the only thing I could come up with. And until we could hire like a real CFO and finance team who like, okay, now we know we got our arms around how much cash we have. It sounds silly, but we had such high volume of money coming in and out. Anyway.”

   2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

7. “There was a point where we had raised, I think, like our series C or something like that. And I think we had our bank accounts. I just put like $25 million in a different bank account that none of the stuff was touched to the actual operation of the business because I was like, you know, our operations were so messy and we needed to hire a new finance person. And I was like, I'd heard horror stories of actually startups where they thought they had X amount of money. And then it turned out they had way less. And then the whole thing was insolvent in like three weeks.”

   2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

8. “So, yeah, you basically need to make sure you have enough money where you don't die if there's some kind of a downturn or hit break even profitability. We were in a position where we were periodically profitable during up periods, but then crypto would go down and we were unprofitable. And so we had to kind of manage our own psychology and the balance sheet to make sure we didn't die in the downturn, which a lot of crypto companies did. We had to basically professionalize a whole bunch of services that had been just very quickly thrown together by like 20 year olds, right? Whether that was cybersecurity, it's like, okay, how do you go get like a really senior experienced cybersecurity person, but not someone who's so senior that they can't get their hands dirty and they can come into a company with 25, 50 people? How do you get a finance person to come and do that? Our finances were a mess.”

   2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

9. “And I probably still am, by the way, like even to this day at Coinbase, we continually have to push down decision making in the org like even 5,000 people. Who are the owners of each of these things? And so the temptation is people to push it up and you become a bottleneck.”

   2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

10. “So, post product market fit, yeah, a lot of it's scaling, and you got to build out an actual company. So I remember I was still writing a lot of code there for a while, and we were hiring in, we had like maybe 25 people or something. I remember one of our investors came by one day and he was like, Brian, how much of your time are you spending writing code? I was like, maybe 50% or something. He was like, how much time are you spending hiring people? I was like, probably 20%. And he was like, I think you need to flip those numbers. Like this company is not going to scale. You're the CEO. You don't need to be writing code every day. You're going to have to transition that stuff. Like even if people can't, all that stuff's locked in your head. So maybe they're not going to do it as well as you for the first six months or something. But like if you don't start transition it, you're never going to build a real company. It's just going to be, you're going to be the bottleneck. So, you know, like a lot of founders, that took me a while to like really internalize that lesson. I'd always heard people say that and, you know, but I still was holding on too much to decision making.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

11. “Yeah, I'm a little skeptical now of the brain teaser thing. There is a whole question about, like a lot of universities are getting rid of entrance exams. So if you're hiring right out of universities, sometimes it's becoming a less reliable indicator of like, are they in that university? And I've heard some companies, we haven't done this yet, but I've heard some companies are actually creating their own for college grads exams like standardized testing almost to get people in the door because the degree almost doesn't mean what it used to, which is a whole topic”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

12. “We started with brain teasers periodically at Coinbase, and we got away from that relatively quickly. And I think it's a tough one because I actually think it does show how somebody kind of performs under pressure, but I don't think it's a super reliable indicator because there's some people who are really good at the typical work situation, but that's not a typical work situation where somebody puts you on the spot, like in a live interview, and sometimes people get nervous and they can't think clearly and like they don't have their computer in front of them or whatever they normally use.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

13. “That's weird Looking to see for humility too. I'll tell you ask people about a time something went really wrong, like you had conflict with someone on a team. And what I'm kind of looking for is, were they part of the solution or are they still holding on to like blame and criticism about that and be like, well, I told them they shouldn't do that way, but they didn't listen to me. These are all bad signs. So I'm looking for, yeah. Can they get the job done? Will they work together on a team? Can they communicate effectively? Do they fit into our cultural values? And, you know, those kind of things. Yeah.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

14. “It's usually like I like to think about what do we need this person to accomplish in this role and get really specific about that. It's like usually something pretty hard. And then I'll ask them a question. It's like, tell me about a time you did X or tell me about the hardest kind of problem you've had to solve in Y. And what did you do specifically to overcome it, right? So I'm asking to see if they can actually do the stuff we need to get done. But then I'm also kind of asking culture questions if I'm interviewing for that. And so I'm trying to see like, are they concise communicators? Can they just give me a clear answer and stop talking? Some people like ramble on for like five, ten minutes if you ask the first question. Some people are, you know, they're interruptors like Church of Interruption. So like they won't stop talking until you interrupt them, which for me I'm always patient and I wait. So yeah.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

15. “To put in an answer, which you can check in a spreadsheet if it was correct or not. And like there were some funny examples in the early days of Coinbase where we put in brain teasers and stuff, but we don't do that anymore. We do normal interviews. We do references. The kinds of things I ask in interviews”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

16. “Yeah, so basically we've tried so many things over the years to make interviews more efficient because it's a huge time sink for the team. So we basically will usually get them down to like 25 minutes. I've seen if you're trying to hire like a big team, let's say of people who are contractors or something, not necessarily full-time employees. I've seen people actually do 10 minute interviews. You can even interview like a thousand people almost like in a week or something. I'm not sure if that quite works out, but let me a little less than that. But you can basically get six and six done an hour if you're just, I need to get a team of 30 contractors for whatever purpose. But if you're talking about full-time employees, I usually do like 25 minute, you know, you're oftentimes like one thing we've done is we'll put like a Google form online and it's like put some basic hurdles in there. Like, you know, ask them”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

17. “Yeah. And there's a whole part of the interview which is about candidate experience, right? Sometimes you know it's not the right person, but you want to make sure they have a good experience If you're just exhausted and you're on your sixth interview and you're like, well, thanks for coming in. And then you're going to create a detractor or someone who's out there, like, fuck that company or Brian was rude to me or whatever. So I had to, honestly, I had to work on that a little bit in the early days because I was doing so many interviews. I needed to make sure that when people came in, I was like, you know, made them feel comfortable, ask them a couple of like warm-up questions, just like, oh, how was it getting in the office? Did you find it okay? And like, what have you been up to this week? And not just a factory assembly line, like boom, boom, boom, like, yeah.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

18. “One thing is, I've done a lot of reps on hiring at this point. So Coinbase has about 5,000 people. Probably the first 500 people or something maybe in that range. I interviewed every single one of those, but you have to remember there's probably like, I don't know, on average, maybe 10 people that went in the process for every one we hired or something. So it was like. By the time that we had 500 employees, I had done like 5,000 interviews or something. I was like very burned out on interviews. I had been doing some days I did like seven interviews in a day or maybe, you know, you would do lots of interviews. Maybe you wouldn't get burned out, but different kind of interviews. Very good.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

19. “How do we scale this thing? How do we hire people? How do we hire an executive team or raise more money? So the problems totally change.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

20. “Yeah, that's right. So you'll know you have it when the usage of your product keeps growing without any marketing dollars or anything like that. It's just like more people keep coming back every week or month. So you're kind of keep, you're basically watching your stats. Nothing is working. You see these little wiggles of false hope in your metrics. And you basically just keep talking to customers, fixing the improving the product. Talk to customers, improve the product, talk to customers and try not to run out of money. So be really scrappy. And then, if you're lucky, you hit some kind of threshold where, like, okay, the thing is good enough now, or we hit on some use case, and then it'll organically start to grow a bit. And then you have a whole different set of problems once you hit product market fit, which is.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

21. “Places like a startup and it fails, you're even more valuable to your next employer, right? Or you can go raise a seed round, pay yourself a salary, try it for like two years or three years. If it doesn't work, go get another job. It's not like you weren't paying yourself a salary during that time. So I think people overestimate the risk of doing a startup and they just never, they never start because. Seems crazy, and all your friends think it's silly. Like, that's sort of the default nature of every big startup idea.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

22. “My other favorite analogy for this is that Like at the base of a mountain that's shrouded in fog, and you're looking up at the mountain and you're trying to think, how do I get up there? But you can only see like three or four steps ahead because the fog is so thick. So you have to just take steps into the unknown. And when you take three steps, another three steps will be revealed ahead of you. And sometimes you'll end up on some local maximum. You'll have to retrace your steps or whatever, or come up to a cliff, you know. Most people in life don't take the steps into the fog, into the unknown because it's scary. Or they're like, I don't know, what if I fail? Or like, I don't know how that's going to work or I might run out of money or I won't be able to get a job after or I don't know, whatever reason. But that is like one of the things that separates, I think, entrepreneurial people with that kind of inclination is that they have sort of a comfort with this risk tolerance, but it's actually not really risky if you think about it. It's not like, you know, at least in most.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

23. “Yeah. Well, if your pre product market fit, the best advice that I have from that period is action produces information. So just like keep doing stuff. I remember like. Paul Gray Yeah, Paul Graham had this great line like that. I think that's his line, and he was like, startups are like sharks. If they stop swimming, they die. So even if you're not sure what to do, just do anything. Because when you do it, it'll produce some information. Like people liked it, they didn't. This was very true for me. There was times where I just did something instead of debating it endlessly and like, just try it, you know, like, all right, so we shipped it. And like there was a couple times where the minute I shipped it, I was like, I knew I know we built this wrong, but now I have an idea what to do next. And it wasn't, I only would have had that idea if we had actually gone through the exercise of going to build it. It's like.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

24. “Yeah. Well, it definitely helped to have a co founder. So there's like that old saying about it's better to be in a great relationship than to be single, but it's better to be single than to be in a bad relationship. Co founders actually blow up a lot of companies too, but when you find the right co founder, which I was lucky to find with Fred Ursom, that was very important. There was definitely moments where I was like kind of at the wit's end or whatever. And he was like, dude, let's rally. And he basically carried the team a couple times in really key moments.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

25. “This Brian? I'm like, nope, wrong number. Click, you know, and I, you know, the next I pick up the next call. It's like when I finish the call, another call is like coming in. I was like, I'm a reporter from Japan asking about a security, nope, wrong number, click. And I finally get the delivery guy downstairs, bring the food up. We were all surviving to like fix this bug. I remember there was just basically a point that night where I was like, fuck, I need to just, I basically just curled up on like a ball on the floor. And I just like cried for a little bit. I think I let myself just kind of wallow in self-pity, kind of took a nap for about five minutes. And I was like, let's fucking solve this. And I like, you know, stopped being like a little whatever and got back up.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

26. “Oh, yeah, somebody posted, so we had all this. We started to get all these customer support inquiries, and like we only had a few people at the company. And so we were backed up maybe like 20,000 support requests. So people couldn't get a hold of us. So somebody posted my cell phone number on Reddit and they were like, if you need to get a hold of the CEO, whatever, because everyone's upset about where their money is. So I remember we're in the office. It's like late at night. We've been working like 12 hours. We're all sleep deprived. I'm trying to hack and get this bug fixed. And we all need like food at the office. And so my phone has been blowing up all day because someone posted my phone number on the internet. And there's like a guy, there was a guy like trying to deliver food and I needed to answer my phone to like get the food from downstairs. So I was like, shit, I got to just see who, if that's him. So I started answering the call. And it's like.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

27. “Yeah, so sleep deprived, like a bunch of people on the internet were pissed at me. The balances were fucked up, like people were tweeting the company's over. Just give the money back. Whatever. And then.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

28. “So, I've always thought about that too for myself. I'm like, how do I? Because you can fuck it up on both sides, right? Like if you just come out and you're like saying whatever's stream of consciousness, you'll often end up pissing off people on your team or tripping over some regulation that you've, you know, there's all kinds of things about running a public company. You can't say certain stuff. But if you're too PR approved in your answer is like nobody trusts you what you're saying. And so anyway, this is something I think about a lot. I don't think I have the right answer, but I'm trying to find that balance.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

29. “A lot of these people, they have like Asperger's, right? A little bit. And sometimes people with Asperger's don't really emote in the same way. And so I think it's almost a form of bias against their cognitive type or something, which is like that person doesn't emote right. I don't trust their intentions. And the other thing I've thought about, too, is that sometimes I think some leaders, like maybe Zuck or Bill Gates, they can come across as a little bit PR rehearsed. They're basically, they're giving the PR approved answers where Elon just says whatever he thinks to a fault. So even if people hate what he says, they're like, at least I believe it's authentic.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

30. “Right. So I ask myself this time too because. I don't claim to know any of these people well, but I've met them briefly, and my impression is that they're actually all smart people trying to do good things in the world. So there's not too much difference there despite public perception. So why is it that some are really hated, some aren't? I mean, it's a complicated question. Obviously, Zuck and his Facebook got blamed for the whole election thing and all that didn't help. Social media has gotten a lot of pressure just from like, you know, hey, why aren't you solving all society's tough problems? It's like, well, they're just one company. But one thing I've noticed is that”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

31. “Never want to become so surrounded by people who just work for you and will say yes, and then you think like, well, I'm a genius and I am like, that's how you become a dictator or whatever. But you also can't care so much about what people think because then you'll never do anything that's truly authentic to yourself. One other thought on that, by the way, I think it's a really good question. So, I've thought about this a lot. People generally kind of hate on Zuck and they hate on. They don't really hate on Elon. Actually, Elon has a lot of haters too, but it's a different thing.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

32. “I don't know about wisdom, but I've thought about this too because, yeah, you want to always be open to feedback, especially from people who have like your best interests at heart, right? And if you can become isolated from it and just like, you know, surrounded by yes people. And I mean, who knows, maybe like she and Putin and people like that are in situations I have no idea. But if you listen to too much of it and you just try to please everyone, you'll never get anything done. And most of the best leaders are people who can act when they believe that they're doing something net positive for the world and humanity. And they actually don't really care if they piss off some proportion of the people. Almost anything you're going to do of significance in the world today is going to piss off 5% of people, maybe 49% of people or whatever, maybe 60%. I don't know. So.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

33. “But that's not the case at all. And most founders I've known have gone through this too where they're very surprised at the amount of hate that they get. And I think it's actually like a muscle you can build, your tolerance to it because you go talk to somebody who's like, for you, it feels terrible because you're at the center of this storm. But if you go, then you go talk to like, you know, your family or some other person, like, dude, I didn't even hear about that. They're just busy in their own life. And so they have no idea that you had all this negative press or like whatever it was.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

34. “Nobi told me this before starting a company that, like. A bunch of people will hate you for this, which is like a very counterintuitive thing because, you know, most companies, I think, are doing good things in the world, at least you're trying, right? And so even if someone's like trying, but they're not, they're failing, I'm generally rooting for them, at least you're trying, right?”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

35. “Yeah, well, I didn't. You're right. I didn't know at that time I was like, is this the end? We're so tiny now, everybody hates us. So is it over?”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

36. “We were all very sleep deprived, which kind of exacerbates everything. If you look at the Exxon Valdez spill and all these natural disasters, like sleep deprivation is often involved. So, because the reason why we were so sleep deprived is not just because we were working so much, but the site would go offline in the middle of the night, and I'd get paged. I was like on pager duty. So I'd get woken up sometimes like two or three times a night, like have to try to fix something, go back to sleep. So in that environment, you can kind of get discouraged. So one bad thing that happened was we had a bug on the website and there was thousands of people on Reddit and Twitter who were all like pissed at Coinbase because like the balances were showing wrong and they were just like, you know, fuck this company. It's over. Like I hate these guys. And so that was, I'd never had this feeling of a thousand people mad at me at the same time. I feel like I'm a pretty chill guy. Like most time people don't get mad at me. So that was one. Another one was that.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

37. “Well, there's a couple moments I'm remembering. I mean, so for whatever reason, I had this like big chip on my shoulder at that time. And I was like, I really want to do something important in the world. Like, you know, I could have a good life and like work for some good companies and write some software. For some reason, I never wanted that for myself. That probably wouldn't have been healthier, honestly, just to like as an expected value outcome. That's probably a better thing in life. But I was like, I was like, man, I really want to do something important and have a bigger impact. And I was like, I was willing to sacrifice a lot for that. I was like sleep and not going out with friends and stuff. I remember one of the, just for like years, working on this stuff, remember one of the darker moments was we probably had like maybe five employees at that time. And I remember like a bunch of bad things happened like all at once. And it was, so first of all, you have to remember at this time.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

38. “I had no idea if I was doing anything right at all, but I was kind of loving the experience of it in a weird way. It felt stressful at the time. Like, you know, nothing was working. But I was just, I felt like I was on the right path somehow. And so I just kept going. I don't know.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

39. “You know, I was really looking forward to doing something crazy and a big challenge. And I wanted to. I love kind of crisis moments like that where I'm very determined, right? And especially when I get very set on something and I'm just like, you know what? I'm going to figure out a way to make this fucking thing work. Like no matter what. And so. I reveled in that. I had read all these books about startups and every startup has these major setbacks and just like nothing works. And so.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

40. “So then I had this. We went about the process. My co-founder, I at that time we basically had to get like a bank partnership, payment rails, you know, an exchange, basic exchange function. In place, and the minute we launched that feature where you could just click buy, put in your bank counter credit card, buy it, buy Bitcoin, it showed up in your account, from that day forward, like the number of users started to go up like this. And so we finally had found product market fit after two years of wandering in the desert.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

41. “I'll wrap the story here by saying that I found the right co founder after Y Combinator. We still didn't have any customers. The thing that I basically launched the hosted Bitcoin wallet, there were people signing up. I just posted on Reddit and places like that. And maybe like 100 people would sign up and then nobody would come back. And so I was like, I just, in Y Common, do they often tell you, you know, talk to your customers and improve your product. Talk to your customers and prove your product. That's all you're supposed to be doing. Try to find product market fit. So I emailed like five of the users that had signed up and I was like, hey, I worked on this app. I saw you signed up. Can I get on the phone with you? I get on the phone with like five of these folks. And I was like, you know, why didn't you come back? And the guy was like, well, the app was okay for a beta, but I don't have any Bitcoins. So I didn't really know what to do with it. And I remember this light bulb kind of went off my head. I was like, well, if I put a buy Bitcoin button in there, would you have used it? And he was like, yeah, maybe.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

42. “Bitcoin node in Ruby, which turned out to be maybe a weird decision in hindsight because Ruby wasn't the most performant language. We've subsequently had to rebuild that many times. Yeah, I had this hosted Bitcoin wallet, and the thing that I didn't have any users for it, by the way, I applied to Y Combinator because I was like, maybe if somebody there writes me a check, this will like make it feel like a real company. And I was trying to find it, I was trying to find a co-founder at that time unsuccessfully. So I was basically just wandering in the desert. I had a lot of self-doubt about this because I was like, I don't know, all my friends don't think this is kind of dumb. And maybe Bitcoin is just going to get shut down and like this will all be some stupid thing. There was definitely a feeling of just wandering lost in the desert, lots of self-doubt. Paul Graham and the Y Combinator group kind of wrote me the first check after I went and interviewed and stuff and they wrote me a check for like 150k. And that was the first time somebody who I really looked up to kind of said, this is worth pursuing. Maybe you're onto something, maybe you're not, but like, let's at least try it. And so that was kind of what gave me the confidence to quit my job and try it.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

43. “Well, first of all, I don't really get what you're doing at all. Bitcoin sounds like a scam or something. You've gotten involved in. But then other people who understood what Bitcoin was told me they thought it was a dumb idea because they're like, dude, if you store all this Bitcoin, you're just going to get hacked. Like nobody, you know, why would you do that? And so I kind of had this thought like, you know what? I'm not going to go all in and make a store everyone's Bitcoin. That would be too much right now. I have a job. I have a day job, you know. But let me just make a prototype and I'll tell people this is like a beta thing. Like, don't put any real money in it and just see if there's interest. And if I feel like I'm onto something, maybe I'll go do this as a company. Because I did, I really wanted to be an entrepreneur at that time. I was like, I was 29. I was almost turning 30 and I always wanted to like start a company, but I was, you know, I wasn't yet. I was an employee at a company that was great. So anyway, I had this prototype I was hacking together nice and weekends. I actually wrote a whole”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

44. “Well, SMTP is a protocol that runs email. And Git is a protocol for version control, but people made like Gmail and GitHub. Most people don't want to run their own email server or even their own Git server. They just want to use a hosted thing that, you know, will do all the security and backups for them. So the thought in my head at that time was Bitcoin's this new protocol. There's probably going to be somebody who makes a hosted service that does all the security and backups for you, makes Bitcoin as a protocol easy to use. So maybe I should maybe I should make like a hosted Bitcoin wallet or something. That was my, it was going to make Gmail for Bitcoin or something. And a bunch of people told me that was a bad idea. Most of my smart friends who I told about it, they were like”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

45. “Well, I definitely didn't know if it was going to work. I mean, it was kind of, I felt like I was just following my gut. So, I mean, I was working at Airbnb. I was a software engineer there. Project manager. I was working on some fraud prevention stuff, for instance. And I read the Bitcoin white paper in kind of December of 2010. I started going to some Bitcoin meetups in the Bay Area, met lots of interesting people there, like crazy people, anarchists, you know, like really brilliant people, all the above. And so I started nights and weekends trying to put together a prototype. And my initial thought was.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

46. “Another cat and mouse game. So I think they've, yeah, but it's using a lot of similar signals like mouse movements, keystrokes, and then obviously all the stuff that comes over the wire with your browser. So what operating system, what fonts, you know, what headers are being sent over and how There's an old website, I can't remember what it's called. It was called like Panopticlick or Panopticon or something, but it basically was a proof of concept site that they would just show you all the data that was kind of getting sent over with your request. And say that there's only one person in the world who has this exact set of data. It's you. And so it's almost like a workaround, a clever workaround to track somebody, identify a unique person even if there wasn't a cookie involved or something.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

47. “Who was one day in Austin, Texas, and then an hour later they were in London or something. It's like, well, that's very improbable. I mean, sometimes people were using VPNs, so you got to be careful with that because there's legitimate people who use VPNs too. If it's not possible for them to have gotten on a plane and gotten there that quickly, then that's usually their spoofing a device or IP. Sometimes those are interesting factors. But yeah, if you feed enough of these in, you will, oh, another fun one is like. Real users will type their credit card one number at a time Scammers have a list of them and they'll just paste in a whole number. So you can look at like the number of milliseconds between keystrokes. There's all kinds of stuff people have come up with.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

48. “Just kind of, I don't know, relatively well known stuff might be. You have device fingerprints, right? So what kind of device are you on and what fonts do you have installed? A lot of people who are farming lots of these accounts, they're using emulators and like virtual machines and stuff. They're not like, you know, an average person on that device. And then you'll see sometimes like one of my favorite metrics we track for this was called like improbable travel velocity. So we're tracking people's IPs, right? And you might see some”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

49. “Protect Against it. So, what you want to do is kind of build up a labeled data set of all the different people who have turned out to be fraudulent and good actors and hopefully collect as much data as you can. And then you might feed hundreds or thousands of these factors into your machine learning model and it'll come back with a risk score. So an example of the kinds of factors people create or put in there. You know, obviously I don't want to disclose too many of them because it's a cat and mouse game.”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source

50. “Okay, so fraud prevention is a big topic. So there's a lot of things people do, but one of the things they do is that Use machine learning, right? So you look at hundreds”

    2022-07-29 · Lex Fridman Podcast · #307 – Brian Armstrong: Coinbase, Cryptocurrency, and Government Regulation · IDENTIFIED FROM THE TRANSCRIPT · source