NCFA Canada | May 29, 2020

BIO:  Austin is the CEO and co-founder of Consilium Crypto (https://consiliumcrypto.ai/), a big data company developing institutional grade investment analytics and liquidity access tools for the digital asset markets, helping funds find alpha and place large orders efficiently in times of thin liquidity. With a background in software development and machine learning, as well as previous tech startup experience, Austin brings a skillset balanced between the technology and business worlds. He previously worked with a distributed team based in L.A./San Francisco to build predictive models for crime hotspotting in major US cities, before transferring to the FinTech world to build machine learning based trading systems for currency markets. Enjoy!

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Transcription of Interview

Intro: Welcome fintech Friday's a weekly podcast brought to you by the National Crowdfunding and Fintech Association of Canada and partners.Covering all things fintech block chain be AI and alternative finance.

Manseeb Khan: [00:00:19] Hey everybody Manseeb Khan. Thank you for tuning into another fantastical episode of the Fintech Fridays podcast, Quarantine Edition. Hopefully you guys are staying safe, but also staying said it might feel like the movie Groundhog Day. I know it does for me personally. Everyday feels like Sunday and also Tuesday. It's very weird, very strange. But you know what? It is what it is. On this week's episode, we have Austin Hubbell from Consilium Crypto to kick off the first episode of the Fintech Friday Qurantine edition. So enjoy it. Awesome. Austin, Thank you so much for joining me today.

Austin Hubbell: [00:00:56] Thanks a lot for having me, Manseeb. Great to be here.

Manseeb Khan: [00:00:58] Awesome. So awesome. Give us a little bit of who you are and what you do.

Austin Hubbell: [00:01:03] Absolutely. So I'm a CEO and co-founder of Consilium Crypto.  Consilium s a big data company that captures siloed data sets from digital asset markets around the globe and brings them into one system where they can be easily transformed into valuable insights for investors. Every month we capture and analyze more transactions than the Toronto, London and Hong Kong stock exchanges all combined. And we're a B2B company, so we work with funds, exchanges and ATC desks to provide machine learning powered trading tools.

Manseeb Khan: [00:01:35] That's awesome. So how have you been holding up during this whole quarantine thing? I know I'm definitely getting a little star crazy. You know, before before we jumped on me, my best friends jumped on a Zoom call, and we all watched the NFL draft together just to get some sort of semblance of human interaction. How have you been holding up how is especially being a CEO especially working remote? How's that transition been going?

Austin Hubbell: [00:02:02] It's been it's been an adjustment for sure. I think our company, as long as well as a lot of other tech companies, are in a better position than a lot of other small businesses just because we continue to operate despite some of these restrictions. It definitely has had an effect on communication with the team. I think there's a few things going around right now apart from Corona. So a few of our our team members have been sick and out of work for a little while. But apart from that, things are going fairly well. We're also fortunate to have a little bit of practice with the remote work just because we do have a team in Toronto and a team in Montreal. So we do have a little bit of practice kind of keeping that team cohesion from a distance. But there's no doubt that it's had a lot of negative impacts on our business, just like everyone else's.

Manseeb Khan: [00:02:48] Yeah, I know for sure. It's definitely a very interesting shift and it should be very interesting to see how businesses are going to currently adapt by working remotely.  You know, some companies are going to thrive from working remotely like, you know, hopefully you guys are and some are not. But, you know, let's let's let's dig into the how did how did you get started into the whole crypto realm, as you say?  I mean, you know, for me, I was just a you know, my crypto journey probably started two years ago. I was just Googling a bunch of things and just found this crypto thing fun to watch people on LinkedIn. And then I kind of jumped up like, honestly, that's the whole purpose of this show, is to sit down with amazing experts like you so I can kind of learn more and, you know, let my audience learn more as well.

Manseeb Khan: [00:03:33] Well, it's a bit of a winding path. Like most people are getting into crypto previously worked at a proprietary trading firm in Montreal focusing on forex. So global currencies, we were looking at G10 spot markets and trying to do some interesting things with machine learning to get an edge in that market for trading purposes. At the time, I had a few friends that were very involved and then blockchain and crypto and they kept kind of bugging me about it more or less. They kept coming to me and saying, You have to check this out, you have to check this out. And so near the end of 2016, I started studying for the C4 certificate. So it's the crypto currency certification consortium. I'm missing one of the C's in there, but that's one of the really great. Yeah, exactly. Well, it's one of these online courses that teaches you the fundamentals of Bitcoin and blockchain. And one thing that I thought was really cool about that, course is in the end, you take this test and if you pass, you can get a certificate, but they force you to pay for that certificate in Bitcoin. You can't use PayPal, you can't use your credit card. So you have to actually go get some Bitcoin somehow, create a transaction and actually pay for it in Bitcoins. So that was my my intro into the crypto world. And then about seven or eight months later would have been around Q3 2017. The opportunity just kind of presented itself to make the leap over from Forex and start something new in cryptocurrency. And basically what I saw was the opportunity to collect this amazing dataset of raw transaction data, bids and ask to order book data, from these exchanges and distill it into value for investors. And that's something that would be incredibly expensive to do in traditional markets and within crypto. It was a lot easier at the time, at least.

Manseeb Khan: [00:05:25] Yeah, no, that's That's. Wow, that's awesome. The fact that you have to actually purchase is difficult in Bitcoin That's.  Wow, that that's amazing. You know.  Creating a system or creating a program that helps funds understand Crypto more, I guess what would be your, I guess know, diluted tips and tricks of the trade that you can share with our audience, that things that there should be kind of looking for things that you've picked up along the way.  I mean, granted, you're definitely a lot better now at understanding and like analyzing these assets than you were from day one. Were there like a couple of things that you kept in mind that's helped you stay the course?

Austin Hubbell: [00:06:12] Well, I think it's important to treat these things as a technology first and an investment second, so really understanding how these things operate. The risks involved, especially the tail risk involved with these things. For example, vulnerabilities in smart contracts, things like that. Companies that operate in the cryptocurrency world, if they're not very careful about how their funds are managed and that the security protocols in place, it really creates a price on your back for hackers. So I would say that for people who are just coming into crypto, don't treat it as a speculative investment, treat it as a new technology. So think of buying an individual crypto asset as buying an app on the app store. So put in five to ten dollars, play with it for a while until you have a thoroughly understanding of how it works and then decide if you want to go up a tier or how you want to actually engage with this if you want to use it for its intended purpose of kind of maybe remittances or transferring payments or peer to peer cash or if you want to use it as an investment. And so once you've kind of made that decision, I would say at some point the next step would be to manage your own wallet. So it's a very powerful process to control your own private keys and understand the signing process works and really just go slow and steady, ask for help at every step in the process if you need it, and just focus on education and really understanding the tech side rather than just treating it like some kind of slot machine.

Manseeb Khan: [00:07:41] Yeah, I know for sure. I mean, understanding that, you know, it is not a lot like looking much is not speculative.  The app, the app things, it was it was a great example. Education is going to be the key education's That's. Hey, that's that's the purpose of this show, right. Of letting people know what it is. What's the purpose of it?  You know you know, us being a global pandemic right now is a really interesting test case of, you know, banks are shutting down. ATMs are going to have limited cash like, you know, like three months ago you might have wanted to buy a house. Guess what? You can't. You want to buy that. You can't. Right. Like, it's everybody's everybody's money is now held up. This is why crypto came into place, right, so the should be very interesting test case for Crypto.

Austin Hubbell: [00:08:28] Absolutely. Yeah. I'm glad you brought that up, actually, because I have a little anecdote from the last two weeks. Oh, perfect. You were just trying to. Sorry. We were just trying to convert some USD to CAD within our own bank account. So it's not not a complex transaction. Should be very simple. I couldn't do this through the online system with our bank. I called their their their support number and they said that there's super long wait time. I waited for about an hour and a half on there. Got transferred between different departments and their final say was, I'm sorry, you have to go into an actual branch to do this. And that's crazy. So I said, OK, well, I don't want to do that. No. One, because that's just what the opposite of what everyone's supposed to be doing right now. This is really not an essential thing for my life to be done. And then secondly, I looked up at my branch was completely closed. So what do you do now? You know, this is just craziness, but how do the funds been in stable coins, for example? So a Canadian dollar stable coin and a U.S. dollar stable coin. I would have been able to go to any number of exchanges and go make that transaction instantly and get those funds and move on with my life. And so I think that's one area that that hopefully banks will take a second look at one, this whole storm passes and they kind of revisit these processes.

Manseeb Khan: [00:09:51] Yeah. No, I mean, hopefully it's something Banks again, hopefully some people actually look into, right of education is gonna be the key. Knowledge is power in a sense of understanding. They're like, hey, you know what the current economic systems are in are extremely vulnerable. This is exactly why new digitalization of money is coming in. This is why it is going to such a huge push from people in our industry for the digitization of money. Cryptocurrency blockchain because in the next world pandemic, which is now inevitable of, you know, now just the countdown of what is going to happen. Hopefully the next time around, a lot of people have more money and assets where they're not wasting half an hour on call to transfer funds. I mean, anecdote, for me was a couple days ago, I ran to the local bank to the ATM just to get up, get money out.  Unfortunately I wasn't with that bank and that ATM was locked. So I'm like, OK, I need cash. I had to walk to walk to the actual drive through of the ATM to pull out cash. And I was like, OK, well, this is it. This is ridiculous. Like, what are we doing here?

Austin Hubbell: [00:11:02] And 2020, to have that be the process, just to go buy something with your own money that you should control at all times. It seemed a little bit crazy to me.

Manseeb Khan: [00:11:10] Yeah, no, it's it's just it's ridiculous. So aside from the new digitilization of money. What are you most excited about when it comes to the space? When it when it comes to fintech? What are you most excited and what are you most passionate about?

Austin Hubbell: [00:11:28] I think that the education side, when it comes to personal money management or wealth management, having people understand the different ways that a portfolio can be created, whether that's gold based investing, where you're you're actually looking towards a certain thing that you want to purchase in the future, whether it's a vacation or house or something like that, and really just diving into how people can retain control of their money. Well, still manage it and sophisticated, smart ways. So I think the ability for technology to do a little bit more hand holding with the end user or with the person whose funds are being managed as opposed to just kind of completely handing it off and hoping for the best and hoping that you're either financial adviser or robo advisor does a good job without really understanding the underlying principles. I think that's a huge opportunity for FinTech. And then the second one, I would say just to circle back the blockchain a little bit, would be the digitization and tokenization of assets. So I think fractional ownership in assets and the ability for people to trade these things peer-to-peer around the world and really bring the kind of less fortunate emerging markets, third world, whatever you want to call it, and bring that into the capital market system and give them access to capital and give investors access to those amazing opportunities and ideas without the friction of the financial systems and different countries and having their own infrastructure and kind of payment rails and whatnot. I think that's a huge opportunity.

Manseeb Khan: [00:13:04] Yeah, 100 percent.  The fact that opening up micro investments into like into like, hey, you know, you can own a fraction of a classic car or a condo or or a commercial like real estate like opening up those little markets is going to make and break is going to be make the biggest difference in the world. Right. Especially now where, you know, a lot of people want to be a lot more liquid. A lot of people want are definitely rethinking where to put their money. I mean, are you going to put on stocks or not? Probably not going to buy a house for enough. Good luck. Are you gonna do that?  Like, it's like having the access of, hey, buying a 67 Camaro. Pretty, pretty awesome right now. You realize that that's a young, dumb investment that I definitely make right now. If I had that. If I had the ability to for sure.

Austin Hubbell: [00:13:56] Amazing, yeah. Everybody's got their own their own 67 Camaro that they want one day. So I'll think with the right education, the right tools. We can all get there.

Manseeb Khan: [00:14:06] 100 percent. So what do you see? The biggest shifts being in the industry post-covid.  Right. You know, businesses are definitely become more remote. This is I mean, aside from the whole money aspect of it, how companies are gonna start working and interacting. You're going to see a lot more virtual teams, right? A lot of crypto companies, a lot of blockchain companies are in all aspects. They're global. Right. So unfortunately, can't all be in a room, but they all can be in a virtual room. So how do you see the shift happening in the industry? Post this pandemic?

Austin Hubbell: [00:14:41] I think one of the biggest things will be automation. I think right now and for the next few months, there will be a lot of belt tightening among big companies and small companies that really just kind of taking a step back and looking at the business and saying, OK, what part of these processes can be automated? How much is it gonna cost me to build out those automation's and how much am I going to save in the long term? So I think this has been a big accelerate towards automating all these processes and kind of removing humans from parts of the process where they're just simply not needed. And then the second interesting point that kind of ties into that a little bit is we are doing a little bit of a soft test right now as a society with UBI. So this isn't technically universal basic income, but the amount of support coming from the government right now. This is a little bit of a trial run to see how people react to this, to see how the economy reacts, to see how society reacts. I think the intersection of automation and potentially some form of a few UBI down the road might be really interesting to see how that plays out.

Manseeb Khan: [00:15:47] Yeah, 100 percent. I mean, it should be. What we're running, like you said, was running a test. This is just a trial run to see, you know, what works, what doesn't work. I believe the automation thing that should be very interesting of seeing how companies are going to come out, come out of this and reassess, hey, what in our definition or whatever you want to call it, qualifies as an essential worker. Right. And can we automate these things right? Your SLOWLY seeing it right now or with restaurants, grocery stores, everybody is doing this stuff online.  A lot of people are waking up, knowing, missing, hey, I could do a lot of these things online and out to actually be there in person, which is amazing. Absolutely. For sure. Yeah. Which is incredible. Austin is there any is there any like, finals like things has been top of mind for you since this like pandemic. Anything that I guess popped in your head that hasn't popped before before we before we wrap this up.

Austin Hubbell: [00:16:51] Well, at Consilium, we we spend a lot of time looking at markets and whether that's crypto currency markets or traditional markets. I think the biggest takeaway from this is find a way to manage your tail risk or at least be aware of what tail risk can look like because this thing came out of nowhere. There was I would say that there's no real regulation or government policy that could have prevented this, unlike some kind of things like the global financial crisis in 2008. This was something that came out of nowhere that no policy could have prevented. And that's a true kind of black swan or tail risk event. And we're all feeling it in terms of our day to day lives. Also in our portfolios and also just how society as a whole is reacting to this. So just be aware of what tail risks that tail risk can happen. And just just re-examine everything in your life and think about how can I manage this? How can I hedge against this, even if it's in some small way so that you can sleep at night when this next event comes? Hopefully not anytime soon. But I think the way that the trend is that these things will be happening more often throughout the next few decades.

Manseeb Khan: [00:18:01] Yeah. Awesome. Austin thank you so much. Would be the best way for our audience to either reach out to you if there's any questions about Consilium, if they have any any questions of, you know, mitigating the tail risk.  How would I would on audience contact with you?

Austin Hubbell: [00:18:16] Well, as a company, we try to be very active on LinkedIn. So I'd say the first thing would be to follow our company page on LinkedIn. And then also just feel free to reach out through through the Web site contact form. We always reply to everybody that comes through there. So, yes, please feel free to reach out anytime if you have questions or you're looking to learn more about the company or crypto assets as a whole.

Manseeb Khan: [00:18:37] Awesome, Austin thank you so much for sitting down with us today. And I'm excited to sit down with you, hopefully in a real room after this pandemic.

Austin Hubbell: [00:18:46] Sounds great. Thanks a lot for having me. Manseeb take care.

Outro : you've been listening to fintech Fridays brought to you by NCFA and partners. Tune in weekly for the latest fintech Friday podcast by subscribing to this channel. The National crowdfunding and FinTech Association of Canada is a non-profit actively engaged with social and investment fintech sectors around the globe and provide education research industry stewardship services and networking opportunities to thousands of members and subscribers. For more information please visit and see if a Canada dot org. Oh yea.

End of Podcast

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