Dialogue with Sun Yuchen: I hope to play the role of a preacher

Author: Song Liwen

Source: Jiemian News

"I have never seen a village where the aurora appears, nor have I seen anyone setting off fireworks in the deep of night. The evening star is like your eyes, killing and setting fire; you said nothing, and the wild wind disturbed me."

This was a comment made by Sun Yuchen not long ago under a tweet by Tesla chairman Elon Musk.

As November arrives, the newly crowned world’s richest man, Musk, posted a poem by Cao Zhi, "Seven Steps Poem," in Chinese on social media. Sun Yuchen, who never misses a trending topic, quickly replied with a popular Douyin song, "Mohe Dance Hall," leaving people puzzled.

Andy Warhol, the father of pop art, predicted at the end of the last century: "In the future, everyone will be world-famous for 15 minutes." This statement has become a reality in the 21st century.

However, having captured Warhol's "Three Self-Portraits," Sun Yuchen seems to be an exception; he has turned "15 minutes" into a game and tirelessly chases every trending topic.

In the Chinese world, he is labeled as a post-90s entrepreneur who graduated from Peking University. Yet he has also been called a "fraud" by Wang Xiaochuan, almost missing the "Buffett" lunch, stirring up various controversies on social media.

In the crypto field, he represents another image; he is the symbolic figure of TRON, one of the few Chinese KOLs in the crypto space, and is now set to become Grenada's representative to the WTO.

Amid the baptism of industry upheaval, he has become a whale wandering in the ocean of crypto, representing a blockchain network valued at $60 billion.

Like most people in the crypto field, his avatar is an NFT, and he remains active on social media late at night. His way of maintaining energy is through fitness, and he is often seen wearing T-shirts.

On the night of the "519 crash," he spent $600 million to buy the dip on Bitcoin and Ethereum, tightly linking his fate with them.

The following is an interview with TRON founder Sun Yuchen by Jiemian News, with some edits.

Persuading the Unpersuadable

Reporter: There have been many controversies surrounding you, from Wang Xiaochuan's comments to the Buffett lunch and the Dream Fund on Weibo. How do you view the controversies surrounding you?

Sun Yuchen: Aside from the controversies surrounding the blockchain industry itself, I think my personality also influences how I am perceived. The reason is that I particularly enjoy earnestly explaining the ideas I believe in to those who strongly disagree with me. I know they don't agree, but I am willing to try to persuade them, even using public debate as a means of communication.

I believe it is meaningless to persuade those who already agree with you. To persuade, you should choose the hardest ones to tackle; only then is your work meaningful. If I spent every day trying to persuade my parents or friends who already support what I do, what significance would that persuasion have?

So I viewed people like Wang Xiaochuan and Buffett as targets for my efforts. Such stages and opportunities are the best timing for spreading the new field of blockchain. Although it was clear after the dialogues that they were not persuaded by me, my proactive engagement also brought controversy. If I had remained silent, these controversies would not have existed.

Reporter: After achieving a certain level of fame and experience, what are your current life goals?

Sun Yuchen: The other day I looked at the global number of registered blockchain users, which is around 150 million to 200 million, while the world population is nearly 8 billion. So I think 200 million is still a very small number compared to 8 billion. In the next 5 to 10 years, we need to continue working hard to expand this number from 200 million to at least 2 billion.

Reporter: What role do you want to play in this process?

Sun Yuchen: I hope to play the role of an evangelist, so that when people talk about me in ten years, someone can say, "I know blockchain because of him."

Reporter: What is the proportion of cryptocurrencies to traditional assets in your personal wealth? How is your cryptocurrency portfolio allocated?

Sun Yuchen: The proportion of cryptocurrencies in my personal assets is over 99%, as I basically do not hold any traditional assets in real life. I mainly hold Bitcoin, Ethereum, and tokens from the TRON ecosystem. The TRON ecosystem accounts for about 60-70% of my overall holdings, while Bitcoin and other cryptocurrencies make up the remaining 20-30%.

I used to joke that post-90s individuals shouldn't buy houses or cars before turning 30, but now I am actually 31 and still have neither. I think my personal lifestyle philosophy is still very modern.

Has Bitcoin Failed?

Reporter: In 2008, Satoshi Nakamoto published the "Bitcoin White Paper," defining it as a peer-to-peer electronic payment system. To date, only El Salvador is conducting this experiment. Has Bitcoin lost its monetary attributes?

Sun Yuchen: To some extent, it has indeed diverged from the initial vision of the "White Paper." However, I think this is very normal. Bitcoin chose extreme decentralization in the trade-off between efficiency and decentralization, hoping to achieve the strongest decentralization, even at the cost of some usability.

A more neutral definition of Bitcoin is as a tool for value storage. Nowadays, people generally see it as a counterpart to gold, corresponding to the concept of "digital gold." Its main function is similar to that of gold; historically, some countries may have used it as currency, but currently, gold primarily serves as a commodity and a means of value storage.

Reporter: The International Monetary Fund does not encourage using Bitcoin as legal tender. Is El Salvador's experiment feasible?

Sun Yuchen: Personally, I believe more sovereign countries will announce Bitcoin as legal tender. However, Bitcoin as legal tender in El Salvador is somewhat of a supplement; the primary legal tender will still be the US dollar. Bitcoin serves as a supplementary means of value storage in developing countries or countries with unstable financial systems.

This year, we have seen that the fiat currencies of emerging Latin American markets like Brazil, Argentina, and Turkey are not particularly stable, experiencing significant fluctuations against the US dollar. Some politicians in certain regions may even start to practice declaring Bitcoin as legal tender, partly for electoral votes.

Reporter: In recent years, some innovations in blockchain technology, such as NFTs and DeFi, have largely originated from the Ethereum ecosystem. More and more enthusiasts and institutions in the community believe that Ethereum will eventually surpass Bitcoin. How do you view this perspective?

Sun Yuchen: This question needs to be viewed from multiple angles.

First, Bitcoin and Ethereum represent two different design philosophies and structures. Bitcoin's main positioning is as digital gold and a means of value storage against inflation. I personally believe its valuation in the open market is comparable to gold. Ethereum, along with TRON, aims to become a programmable blockchain ecosystem. After Ethereum's birth, it introduced a series of decentralized programming models, such as virtual machines and smart contracts, which are different from Bitcoin.

On the contrary, I believe that the relatively few development and upgrade occurrences of Bitcoin today reflect the community's restraint and its role as digital gold.

The second perspective is to consider each person's role. If someone is an entrepreneur or developer in the blockchain field, I personally think that public chains like Ethereum and TRON can provide users with more choices and developers with more possibilities.

From an investor's perspective, I believe the logic of investing in Bitcoin and Ethereum is entirely different. The logic of investing in Bitcoin is to avoid the so-called inflation tax, while investing in public chains like TRON or Ethereum places more importance on the activity of developers and the ecosystem.

Reporter: Recently, the topic of the metaverse has been very popular, and Web 3.0 is often mentioned. How do you view it?

Sun Yuchen: When talking about Web 3.0, we need to first review Web 1.0 and 2.0. Web 1.0 was when the internet was just born. According to the original intention of the internet, Web 1.0 was very decentralized; it built a model for peer-to-peer file transmission, and there was no blockchain at that time.

Now in the era of Web 2.0, the characteristic is high centralization. Companies like Apple, Facebook, and Google monopolize internet user data, and large platforms control everything about you on the internet. The internet has transformed from an unlicensed internet to a licensed internet. I understand Web 3.0 as a hope to decentralize the entire structure of the internet again. In this regard, the metaverse and blockchain are highly coupled; an infrastructure belonging to all humanity should be unrestricted, decentralized, and barrier-free. It should not belong to anyone but to all humanity.

Public Chains Are Cities

Reporter: Currently, Ethereum is at the core of the ecosystem, and new public chains are emerging one after another. How do you view the public chain track?

Sun Yuchen: I have an interesting metaphor regarding public chains. Vitalik (referring to the founder of Ethereum) has also used this metaphor. Public chains are somewhat like cities; each city has a different positioning, and there is indeed competition among them. However, more often, it is a cooperative relationship. For example, there is competition among the four cities of Beijing, Shanghai, Guangzhou, and Shenzhen, but they are not mutually exclusive. Just as not everyone in China can live in Beijing, nor can everyone live in Shanghai, the population will be distributed among these cities, and each city's positioning is also different.

Reporter: Recently, there has been some debate about Ethereum. Due to network congestion and high fees, the founder of Three Arrows Capital even "claimed" to abandon Ethereum. How do you view Ethereum?

Sun Yuchen: Public chains, like cities, will face the so-called "big city syndrome" when too many people use them. I think Ethereum's biggest drawback at present is not innovation or community but how to solve the congestion problem. Ethereum has spent a long time addressing its congestion and high fee issues. The frequently mentioned "Layer 2" scaling is somewhat like building elevated roads to alleviate congestion, but I believe that given Ethereum's growth rate, even with elevated roads, it will quickly become congested again.

Thus, different public chains, including TRON, Avalanche, and others, each have their own characteristics and positioning, which can help share the pressure and traffic, just like cooperation among cities.

Reporter: Based on the "city theory," what is TRON's positioning?

Sun Yuchen: If Ethereum is Shanghai, our goal and positioning is Hangzhou.

First of all, I believe that "Hangzhou" does not see "Shanghai" as a competitor. On the contrary, because it is close to "Shanghai," "Hangzhou" has actually gained a lot of traffic from "Shanghai." Many users who cannot be satisfied by "Shanghai" have moved to "Hangzhou," creating a differentiated competition. I think the public chain track is a relationship of competition and cooperation, with both competition and collaboration.

Reporter: What aspects of the public chain track should we focus on in the near future?

Sun Yuchen: If public chains are cities, I think the transportation issues between cities are the most critical direction, which is cross-chain. This refers to the data and asset interaction between different blockchains. Besides NFTs and DeFi, this is an important trend in our industry.

Reporter: DeFi (decentralized finance) is currently one of the hottest sectors in the crypto community, and "Code is Law" has become one of the community's consensuses. However, there have been frequent security incidents in this field recently. How do you view the prospects of DeFi?

Sun Yuchen: DeFi indeed has a complete model of "code is law," which unprecedentedly shifts a lot of the risk control judgments traditionally made by humans in the financial sector to computers.

For example, DeFi protocols like Justland, Aave, or Compound have a very good macro-control mechanism. If there is no money in the deposit pool, the deposit interest rate will become very high, thus automatically attracting people to deposit money. A system that might require 5,000 people in the banking system to operate effectively can be managed by just ten programmers in DeFi. I think this is a significant financial innovation.

However, because DeFi is too advanced, a lot of the code and financial models have not been verified over a long period, leading to frequent large-scale thefts in this industry. Since it is an open market operating 24/7, it faces the challenge of 24/7 hackers. For instance, Ethereum often becomes a hacker's cash machine. From this perspective, I personally believe this is indeed a significant problem in our industry. Therefore, I think everyone participating in the DeFi ecosystem should try to engage only with well-tested DeFi protocols and those with audit reports.

I personally believe that DeFi will become the infrastructure of the blockchain industry and will become a daily tool for many people.

Reporter: Is the current high-interest model of DeFi unsustainable?

Sun Yuchen: Yes, but in the future, it will still be higher than traditional financial rates, especially since Europe has seen negative interest rates. However, I personally believe that the current high rates in DeFi cannot be sustained in the long term.

Reporter: This year, you have successively acquired famous paintings by Pablo Picasso, Andy Warhol, and Alberto Giacometti, and you have also changed your social media avatar to an NFT. How do you understand the popularity of avatar NFTs?

Sun Yuchen: Leaving aside NFTs themselves, the history of human beings collecting items is actually very long, and our generation (referring to post-90s) has a different concept of collecting. When I was a child, I particularly liked to collect the character cards from "Water Margin" in the Little Panda instant noodles. Whenever friends came to my house, I would take them to see my collection.

There is also a similar culture in the United States, such as collecting NBA player cards. I have friends who enjoy collecting figurines. Older generations also have their favorite collectibles; for example, my dad particularly enjoys stamp collecting and collecting antiques. So I personally believe that collecting is a demand, and with the development of the internet, collectibles have gradually moved online.

For example, if I simply collected paintings by Andy Warhol and Picasso, maybe only 50 friends would see my paintings hanging in the living room over a year. However, WeChat, Weibo, and Twitter are places we all check daily and spend a lot of time on, so the most effective way to showcase your collection is to change your avatar.

Reporter: You have experienced both Eastern and Western crypto communities. What are the differences between the two regions in terms of blockchain community, developers, and culture?

Sun Yuchen: I personally believe that blockchain itself is a global language because it is built on cryptography and the internet. I think there shouldn't be a notion that the internet developed by Chinese people is different from that developed by Westerners.

Of course, I personally think that Western entrepreneurs and those from the East may have certain differences in strategic development. I believe Chinese people have very strong execution capabilities, which play a significant role in their success.

Because we Chinese are relatively diligent, Western entrepreneurs may play a larger role in areas with higher innovation. So I see this as complementary: Western theoretical innovation and Eastern practical innovation. I personally believe that being able to execute well, produce results, and operate effectively is also a form of innovation; I do not think that only theoretical innovation counts as innovation.