On Solana’s Weaknesses, Private Money, and AI Hype — An Interview with Helius CEO Mert Mumtaz

Mert Mumtaz is the co-founder and CEO of Helius, a company developing infrastructure solutions for the Solana blockchain. He actively participates in discussions about the future of the crypto industry, advocates for privacy-focused financial tools, and openly criticizes some popular market narratives.

The Incrypted team met with him at TOKEN2049 to discuss Solana’s technical strengths and weaknesses, financial freedom, and the role of artificial intelligence in the crypto industry.

Watch the full interview on our YouTube channel:

During the conference, you asked Balaji Srinivasan whether Bitcoin and Zcash can coexist. What do you think about it?

Yeah, for sure. I think you need both traceability in the context of auditability. For example, in the case where you want to know the reserves of an institution, that is useful information for the user. Privacy is optionality.

Whenever I talk about privacy, there’ll be the occasional guy that says, “Oh, but you only need privacy if you do crime.” Which is completely ridiculous.

Here’s an example. When you have thoughts in your mind that are private by default, you can publish them to the world by posting. You can do a podcast. You can write them on Twitter. You can write a book. Or you can not.

You have that option.

And for some reason, money is different. Recently different. Because with cash, this wasn’t the case. But now cash is being outlawed.

And so now you need an alternative where you have the option to say, “I can either shield my funds, I can shield a part of my funds, or I can not shield my funds at all.” It’s up to me. Because if you don’t have at least the option, then it’s enforced tyranny.

And so in such a case, I do think Zcash is the superior sort of solution. But there’s no ignoring Bitcoin’s network effects and the amount of decentralization it has. And so there’s no way that it’ll just be one or the other.

I think any market you look at today, any market on earth, whether it’s PlayStation and Xbox, Mac and Windows, Instagram and X, China, America — there’s always more than one as a leader of some category.

And so I think it’ll be the same with private money.

Let’s talk about narrative. What’s the biggest bullshit narrative at TOKEN2049?

I think 99.99% it’s AI. People say the word “AI” because AI makes money today. And they try to shoehorn it into all these different crypto places.

They don’t even know why decentralization is necessary. They just add it because, oh, why not? There’s just a different version and it says the word AI in it.

I think to do AI properly, you need an insane amount of knowledge and expertise and talent and scale and money and capital.

You need to actually know how to differentiate yourself against ChatGPT, Anthropic, Google, Facebook. That is a tough challenge. You can’t even get PMF in crypto, but you’re going to take on those guys. Is that right?

I don’t like discouraging entrepreneurs, but if you think you have a unique insight through actual learned experience with AI over the years, so that you actually have the scars that you earned while working in that field, then okay.

But if you’re just doing crypto and you just see the word AI and you’re like: “Okay, that can sell that” — not going to work.

You often say privacy is the final scaling frontier. What does Rings solve that privacy L2 or a sidechain can’t?

Rings is made by Helius on Solana. So the difference between Rings and second layers and sidechains is the first two that you mentioned are rollups and L2s. And as a result, they have huge trust assumptions. There are different computers that then post back to the main chain.

And we know how L2s have sort of worked, which is to say, they’re very centralized. They’re AWS multi-sigs. They can be okay for some use cases, but fundamentally, it’s not real crypto because you still have many trust assumptions.

And they’re also not scalable despite being not requiring anything that a blockchain requires, which is interesting. 

And so now the question is, how do you use Solana scalability, but also you make it private? And so Rings allow you to get all the best parts of Solana, but none of the downsides of a rollup and with selective disclosure privacy.

You can get everything that you can get from a rollup, which is to say, you can encrypt certain data. You can control the execution if you would want, if you’re an institution, for example.

But it is an actual technological breakthrough, which took us a long time to build, where you can now have private scalable finance on Solana with none of the downsides of an L2.

Does the next Zcash need to be quantum resistant from day one?

Well, it depends on what one considers to be Zcash. If it’s going to be a private money, like a Zcash to Bitcoin, so Zcash should always be in the context of Bitcoin and gold. It’s the asset that you care about. And the privacy is an enabling factor for the money itself. But it is not the main feature. Because you can add privacy to other chains.

Now the privacy will be weaker on those other chains, cryptographically speaking, but it’ll still be fine.

But with Zcash, it’s the assets. Similarly, I think you need a lot of other things for the assets that are very hard to replicate.

First of all, you need really good distribution. Proof-of-Work mined over a decade. Zcash has been mined for over 10 years. And it’s been going down only in price. But that allows for all the people to be shaken out for the money to distribute all over to the actual believers, rather than just the VC that got in there early and is now looking to talk his game, which is today that’s 99% of coins. It’s just a huge investor cabal and then all these different things.

But Zcash and Bitcoin have decentralized over many years for the distribution. And so quantum on its own is not enough. You also need distribution. You need neutrality. You need a hardened decentralization in terms of the code base, like a different software client for the miners themselves.

You’ve said AI has basically closed the Rust vs. Solidity gap. What is Solana still bad at?

So when you think of blockchains, you need to think of the blockchain itself, the network, and then the token. So there’s the token SOL and there’s the blockchain Solana.

The blockchain Solana is undoubtedly the best place to build a business today. It is the most scalable. It harbors the most startups, the most successful startups — FOMO, Axiom, Pump, Phantom, Magic Eden, Backpack, JITO…

But the investment case for the token is rather weaker compared to how strong the chain itself is on a physics level.

Solana — you can say it’s a chain that makes money. And if you stake, you get money back.

You can see it can be a currency for, because all these institutions will come on-chain and start trading. And to do that, to get ads, you need to hold SOL. So it can be money for institutional trader types.

Toly’s vision would be something like a Facebook where activity is going to increase a hundred times.

And it doesn’t matter if you don’t have the monetization today, similar to a Facebook or Google back in the day. As long as you have all the activity clasetry in one place, the other part is easy to figure out.

So you have all these different answers. And the weakness, of course, is that it’s not one answer. 

What would have to happen for your Solana thesis to be wrong?

I think what would have to happen is there would have to be a chain with superior technical qualities.

That is just getting sustained usage that surpasses Solana over a period of three to four years at least.

Then clearly this is not the only one that was possible. And if it’s not the only one that’s possible, that really hurts the thesis because the thesis is that everything is supposed to be concentrated in one chain.

What crypto product would you recommend to your mother today?

A Zcash wallet, such as Zodl, is very nice because what you can do is you can hold the money in there, the Zcash. And it’s private, so people don’t know anything about it.

However, you can click “Pay” and then it will let you pay on any chain in any token.

For example, if you’re in Dubai, you want to order flowers and chances are they’ll take USDT on Tron. But I have Zcash. So you just click “Pay” and then it does the same for USDT on Tron.

But also some people might take USDT Solana. Because I’m obviously on Solana. But again, one click. And you can play around with the whole of crypto while still having security guarantees from privacy.

What changed your mind the most this year?

I would say, it’s gonna sound like a douchey answer.

But I obviously am a big believer in the true vision of crypto to be sovereignty and freedom and all these different things. But the trend was very clear that the institutions are gonna hurt that narrative quite a bit.

I was still very bullish on that. But now — given the political landscape in US and the CLARITY Act — failing and Trump having pretty bad midterms, it’s looking like it’s gonna be a democratic America, a democratic party, which is pretty bad for capitalism. Because they’re very socialist types there.

How much of Helius’ success came from tech and how much from you being extremely online?

They basically both had to be 100% because if I only shilled but the tech didn’t work, then you can’t really sell to developers. Developers need to actually try and then see if it works in production. I can say everything I want, but if it doesn’t work for the developer, then it’s a zero.

At the same time, if it’s extremely good tech, but I don’t talk about it, nobody knows about it — it’s also a zero. And so it has to be both of them pretty equally.

Today, I would say it’s actually not much me. I don’t even really talk about Helius that much. And it just works. And people tell their friends that it works and all these different things.

If you met Satoshi tomorrow, what would you ask him?

I would say: “What do you think about Zcash?”

And I know the answer because he wrote about it before. If you look at Bitcoin forums, he talks about if you could add ZK to Bitcoin, a better, more efficient and easier Bitcoin would be possible. But I don’t know how. Because to his credit, zero knowledge technology did not exist or definitely wasn’t established at all back then.

And then I would say: “What’s your real name?” And that’s about it.

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