Crypto Law and the Three AI Hats Legal Leaders Need With Coinbase's Molly Abraham

Molly Abraham00:00
I think the most effective CLOs, GCs, you name it, are those that are great business people who happen to have a legal toolkit.

Cecilia Ziniti00:14
Welcome back to CZ and Friends, where we talk with founders, operators, lawyers, and technologists shaping how modern companies work. I'm your host, Cecilia Ziniti. Today I'm joined by Molly Abraham. Molly started as an engineer at Procter and Gamble before law school. Then she went to legendary law firm Wachtell Lipton, spent six years on multi-billion dollar litigations, SEC investigations, DOJ investigations, serious stuff. Then she went in-house. First at Kitty Hawk, the flying car company backed by Larry Page. And then now she's at Coinbase.

Molly Abraham00:38
Thank you.

Cecilia Ziniti00:44
Which of course has CLO Paul Grewal, a former federal judge. At Coinbase, she's been the VP of legal since 2021 through one of the most scrutinized regulatory periods any company in tech has ever seen. Coinbase does not shy away from working with regulators and fighting for, um, you know, what they believe. So very excited to get into it with Molly. I met Molly through the L suite where she gave a talk that I literally still remember on how to be a lawyer that engineers love. That's something we don't, we haven't talked about as much, but GC AI was almost called Product Council AI and Molly is one of the people that's an icon in the field.

Molly Abraham01:10
Thank you.

Cecilia Ziniti01:17
So excited to get into it with her. She has a contrarian take on career development, a framework for how legal leaders think about AI, and I cannot wait to dive in. Let's get into it. Molly, welcome to the show.

Molly Abraham01:29
Thanks so much for having me. I'm really happy to be here.

Cecilia Ziniti01:31
You were an engineer first before you became a lawyer at Procter and Gamble. So I'm madly curious, what did you work on? Did you work on the folds in our paper towels or something? But anyways, what did you work on? And tell me about your path.

Molly Abraham01:43
Yeah, so I was an engineer at Procter and Gamble, a product development engineer for a little over a year. I'd also spent summers there during college and I worked on Pampers. It turns out there are a ton of really interesting parts that go into a diaper and it basically is tied to the oil industry because of one of the components, which is fascinating. But I always knew I wanted to be a lawyer. I really did. Math and science was something that I also was really drawn to, but the pull towards being a lawyer was stronger. And I originally thought I wanted to be a patent lawyer. And I thought there's no better way to get hands-on experience than to go and actually be an engineer. And so I studied chemical engineering with a concentration in applied math. I took the LSAT at the same time. And I went to P&G knowing that, you know, I was in the midst of applying to law school, taught the LSAT at night to save money to go to school. And law was always the path for me, but tech is what I love. And I feel like the reason I did it that way, maybe with a little bit of retrospect, to give my younger self some credit, is that it enabled me to do, like to have the biggest possible impact in tech in a way that I thought I could be particularly effective, which is through the law.

Cecilia Ziniti02:59
Wow, so Pampers do have a ton of IP. It is actually a very patent heavy space. And you can actually tell, like I was a brand snob for my kids because it really truly does make a difference. The absorption and all these things, that's fascinating. So you knew you wanted to go to law school, you go to Procter and Gamble. How did you squeeze the most juice out of that? And does that product development experience still impact your practice today?

Molly Abraham03:03
It does. So the vast majority of what I did when I was at P&G was pure product development. I ran a new upgrade to the toilet training product that had a particularly, you know, kind of a material science focus in terms of a really, because what's really interesting now having actually had children. This was a fascinating job to have by the way, before having kids. But you want a...

Cecilia Ziniti03:33
Ha ha ha.

Molly Abraham03:49
...a child to feel wet, but you still want the product to absorb. So finding the right material science to have the feeling of being wet while keeping the skin safe and dry is like a very, very difficult and unique thing that you want to do. And it's also an interesting business case because effectively if your toilet training product works well, you are graduating people out of your product. Like you literally are like stopping that user journey sooner if you're doing the right thing. So the whole thing was completely fascinating, both from a business and material science, et cetera, perspective. The thing that I leaned into to really take advantage of the time there, Pampers was known for like being in the middle of these IP wars effectively between Kimberly-Clark and Procter and Gamble. And so I took the opportunity to go and speak with the GC of the baby division and that business unit and say like, hey, I'm really interested in going to law school. I would love to figure out how I can better support you. And one of the things that I did was I actually got a patent. I helped come up with a way to capture effectively both a material science element of what we were doing, but also part of what made the product unique and competitive. And so through that process of working with the patent office at P&G, I said, wouldn't it be great if we could also maybe use the analysis of what patents are being filed by competitors to help see, like use it more as competitive intel. So really kind of taking, hey, I've got this legal toolkit, but what we need to understand as a business is what's coming next. And so as like a very green, naive junior product development engineer, I said, I think I can help map out the white space more effectively for what we and our competitors are doing, both to identify opportunities to file additional patents, but also to use it as market clues. And I still today love using all things legal as like market clues, like tracking dockets, you name it. And so by just getting involved both with the legal team at P&G, but also doing my day-to-day work as an engineer getting a patent, like in the year and a half that I was there, I was able to kind of see what the power of those two things together can be. And I really tried to replicate that like throughout the rest of my career.

Cecilia Ziniti06:11
What you're describing, a lot of what resonates about it is that curiosity. You're literally on the docket, you're at the PTO, you're just like, how? How do you train yourself to make those connections? And how do you train your team now, as product counsel, to make connections like that?

Molly Abraham06:16
So I talk to my team all the time about what I call "dot connecting." One of the most important roles that we serve as product counsels or product councils is to be the dot connector across not only the legal organization, but policy, and compliance, and the business. Right. And so we are so, I'm so grateful for it. Legal is so uniquely situated to be able to connect dots even across different product teams. And one of the things I really encourage in terms of like our day to day working style is that we are constantly sharing information. We work in channels. We don't work in DMs on Slack. We make sure that people get FYIs about what we're doing because you never know when someone, myself included, might be able to connect dots between, did you realize that this product team is doing X? And you're helping this other product team do Y? And actually like either their intention or they compliment each other or they could, you know, a one plus one could equal three. And so we actually try to not only serve the PMs for a particular product, but really serve the product organization as a whole and be that, like, "Hey, we've got a vantage point where we can help you connect those dots."

Cecilia Ziniti07:41
I had a guest on the pod a few episodes ago, Mallun Yen, who made the case that that skill, that dot connecting kind of like executive desk type function that legal plays, was actually a great training ground for being a founder. What's your reaction to that feedback or to that view that she shares?

Molly Abraham08:01
I think that makes a lot of sense because at the end of the day, I think the most effective CLOs, GCs, you name it, are those that are great business people who happen to have a legal toolkit. I think that so much of the advice that a really effective GC or CLO is able to give is because they have this great vantage point, they could connect dots, or they've seen a lot of reps of things that have both gone wrong and gone well. Like they have all of this to draw upon, but at the end of the day, they're a business leader first. And to me, that's why I love, love supporting and working with founders, with product group leaders, because I think that I can help unlock things for them. And the way that I unlock them, like my set of tools or like keys to unlock happen to be legal ones, but I view myself as a business person first and a lawyer very much second.

Cecilia Ziniti08:53
When you talk about keys to unlock, there's gotta be a story there. So Kitty Hawk was, or is, it's in the aviation space, right? And then Coinbase obviously is alternative currencies and new financial system. Any crazy stories to share? Or you wanna pick one of a particular key that you unlocked as a lawyer for either company?

Molly Abraham09:14
For sure. I'll never forget, we were, so we had a variety of different aircraft at Kitty Hawk, or vehicles. The reason I'm distinguishing and calling it vehicles will become clear in a second. So we had these different vehicles and there was one that we really struggled with because it didn't fit into any box neatly. It wasn't clearly in the FAA's jurisdiction. And it also, like, but it. At the same time, it had wings and it flew and it felt like it needed to be, right? And so we kept talking to the FAA about it and they weren't really sure what to do with us because they were, you know, they're a very storied and traditional regulator. And so we had this moment one day where we said, maybe they're not our regulator, but if they're not, who is? We said, maybe it's the Coast Guard. And so, because we were, this particular aircraft, we were flying so close to the water. And so,

Cecilia Ziniti10:02
You

Molly Abraham10:07
...we talked to the FAA and said, you know, maybe you don't need to worry about us. Maybe in fact, this is something that we should be working with the Coast Guard on. And totally took this different approach. And I think that it was a, and that particular aircraft never made it to commercialization, but I think what was so interesting about the experience and it's shaped me to this day is like never take, you know, kind of the traditional assumptions as a given. Question absolutely everything and be willing to ask the question of why is it that we have to do disclosures in this particular way? Don't be afraid to ask the foundational questions. Often when I'm hiring, I explain to people, the person who will not fit well in my team is someone who's like, yes, I've done X at a public company for 10 years. I know the way that it's done and I am willing to do it. We, like one of the things I absolutely love about my job is we're not afraid to question anything and everything. We are literally questioning how the financial system was built and trying to democratize finance. And so we do that as a company as well. Like we were one of the first companies, you know, our CEO's Twitter handle is like a reg FD channel. And so being open and willing to ask those questions, well, sure, it's always been done this way, but can we do something different? And viewing that as like a welcome challenge. And having, I think you have to have that mindset as opposed to, well, yeah, every company does it this way. Like, of course, you know, that to me is someone who doesn't fit well on my team, regardless of the company, or would not fit well here. And I just, I think what's so interesting about taking that approach is it also forces you to think through the policy rationale for any given rule, because it can't be the case that you say, well, it's always been done this way. Well, why? What was the, putting aside what the rule is, what was the actual policy rationale behind it? Is the rule clear? Is it gray? Like, how can we think about it going forward? I think that's a ton of fun.

Cecilia Ziniti12:05
Put us in your shoes when you were giving that advice. So you're literally like, okay, there's this flying car, but wait, it's sort of not a car. It's a car with wings, but is it an airplane? Is it FAA? Is it presumably, I think it's like VTOL or something, vertical takeoff and landing or something like that. Like, you know, I can hear the law school hype in my head, but it sounds like you came to a point where you're like, all right, it's the Coast Guard. Did you call the Coast Guard? How did you get to that point?

Molly Abraham12:32
Of course. Yeah, no, we, you know, we had a really open dialogue with regulators. Regulators have a lot of flexibility and a lot of authority. And of course it varies by regulator, but being willing to have a productive conversation I think is so important across literally any field. And so it was the open communication with the FAA, bringing them out to actually see our test facilities and show them like, this is what we're doing. This is how we approach safety and like not hiding the ball at all. Like being transparent and saying like, let me show you more about what it is we're doing and why we're struggling to see where this really fits and building that trust over time. And then going to them with that, you know, kind of spirit of candor, going to other regulators, you know, kind of in the same way. And I think the other piece of this is in talking to our exec team at the time when we were trying to, you know, kind of sort this out for this particular vehicle was also being really transparent with them about what I knew and what I didn't. And like, to what extent it was unclear. I think that a lot of us type A lawyers have this tendency to want to like know the answer. Like, yes, I know what the rule is, or I know what the answer is. And the reality is the most important part of the job is embracing the gray, like embracing, I don't know how this regulator might react. I think it's worth trying and pushing the envelope. We don't know if there are other examples of whether someone's done this. Like, we're going to dig into it more. We're going to talk to this particular person at FAA staff. We're going to go talk to this contact. We're going to get introduced to so-and-so. And just being open about not having the answers, I think, was really important in giving this advice. It was more of, hey, I'm willing to be a creative thinker. I'm willing to problem solve that it doesn't have to be the way it's always been, right? We don't need to assume that it's this particular regulator. And then being open and honest about, I don't know how this is going to turn out. I think we should explore it. I think this could be like a strategic opportunity for the company and let me do more work and come back to you. And being genuine and honest about what I knew and didn't know I thought was really important.

Cecilia Ziniti14:38
So you're working in a super regulated area and then you're like, all right, let me go to a more regulated area. What made you take the job at Coinbase? And that constant question asking that you talked about. There are some clients or some business people that you work with that could find that annoying. So how did you know that Coinbase wouldn't do that? And then what drew you to the company?

Molly Abraham15:04
So I have a very specific framework upon which I evaluate opportunities. And it's what drove me from thinking I was going to be a patent lawyer to going to Wachtell Lipton, which does not do patent law in case anyone was wondering, to Kitty Hawk, where I knew nothing about flying cars or the FAA going in, to Coinbase, where I will completely confess I bought

Cecilia Ziniti15:22
You

Molly Abraham15:30
Crypto for Dummies the day before I joined. And I do not choose companies for particular tech, though I want to be interested in the tech. I want to think that there's a real product market fit and something that I can get excited about. I choose companies for the people. I absolutely want to work with the smartest people I can find. And I want to feel like I really click with folks because that's how I'm going to spend the majority of my day. I'm going to spend more time with my co-workers at times than my own family. I want to be surrounded by people that I respect and who are smarter than me. I never want to be the smartest person in the room. And I found when I interviewed at Wachtell, literally my second flight to New York in my entire life, I left feeling this is the smartest group of people I've ever met. I both feel like an imposter and also I feel like I will be a better version of myself coming out of this place. I know nothing about corporate law, but I know that these are the people I want to spend the next several years with. That's why I chose Wachtell. I felt the same way when I interviewed at Kitty Hawk. I thought the exec team was full of absolutely brilliant people who I would learn a ton from. I would learn about how founders work, how a tech company is run. And then I felt the same at Coinbase, literally between Paul and the other leaders. I was like, these are the lawyers I want to learn from. This is the type of company where I think I'm going to become a better version of myself. And I hit my five years at Coinbase on next week. And what's kept me here is I feel like genuinely month after month, like I'm a better lawyer and leader than I was the prior month. And so it's, being surrounded by really, really top talent that is just so highly motivating for me. It becomes table stakes. I'm not going to go to a company where the people are amazing, but the product is not at all appealing to me. But I did not choose any of these companies for their products. I have fully fallen down the crypto rabbit hole since, but I didn't know anything about crypto when I joined.

Cecilia Ziniti17:36
Crypto is, or at least was at the time, and maybe this is my impression, and you can correct me as needed, but crypto was a, is pretty anti the system, right? Or at least it has some libertarian type flavor to it. I personally, I'll admit my bias. I kind of trust the existing financial system, haven't had a problem. And so like I had opportunities similar to you to go to crypto companies because they want really good lawyers and you know, let's assume, my guest was taking this podcast, I'm a good lawyer. But did you have to philosophically kind of be like, all right, cool, I'm going to work for this company that's sort of anti-government or like what was your, like when you thought about that, we recently had on the pod, we had the General Counsel of JSX jets and they, it was a fascinating story where she had been a lawyer at Southwest Airlines for 20 years, decides to go to JSX and JSX becomes the challenger to the

Molly Abraham18:06
Perfect.

Cecilia Ziniti18:33
...the incumbent. And she told the story that her mother had actually written a letter to Love Field or to anyway some regulator based on a campaign that JSX had done. And she said to herself, she's like, that's when I knew that, you know, this was the job I needed to take, was completely independently a family member supporting that campaign. Did you have anything similar? And then, you know, are you just pain seeking to go work in this field or like what is, give me a little bit on that and then on your personal view going in.

Molly Abraham19:06
For sure. So I went to the University of Chicago Law School, which is a pretty libertarian framework and way of thinking. I, so I'll confess, I don't think I fully understood some of the crypto framework coming in, but it absolutely resonates with me. I do think that there's room for both some of the tools of the existing financial system, but it's desperately, I think, in need of an update, in need of putting more in the hands of consumers, in need of being able to have faster transactions, embrace technology. Even just saying that out loud, it's reminiscent in a way of, you know, most planes you fly on today were approved by the FAA 20 years ago, like as in when we were just getting into the internet. And the reason is because the process takes so long to make any updates that we don't have planes that were designed a year ago and we might not for another 20 years. And so in the same way, our financial system absolutely needs an update. The whole concept of T plus two, because it takes you that many days to get a wire, it doesn't work. It doesn't need to be that slow. It doesn't need to be that way in the digital age that we're in. And so I do think that for me, a lot of what's kept me at Coinbase for so long is I think the culture really resonates with me, but the mission absolutely does. I wouldn't be here at this point. I'll confess, I may not have known a lot coming into it, but at this point, the mission resonates with me so deeply because I do think that there is this opportunity to update the financial system, to have better, faster, more costless transactions for consumers. And so it absolutely has stuck. Now, in terms of the pain element, I love that question because I was once talking to someone and they said, you know, why would you have left Kitty Hawk when you did? And I said, well, there wasn't a crazy legal challenge. And they said, but that's the point. Like you did all of this work. You saw them through this huge, we did a carve out and joint venture with Boeing. It was this huge, huge M&A transaction and effort and we finished it. And then I was ready to move on. And it was because I didn't have something as hard or hairy as that anymore. And they said, but this is your time to tend your garden. And I realized in that moment, I am not a garden tender. I am a bring me the messier, the better, the war time, the better. Like I love the intensity. And again, I wish I could take credit for five years ago, having made the decision to come to Coinbase because I deeply believed in crypto. I was excited about the framework for how crypto was going to update the financial system and I knew that it was going to be the biggest and hardest, most fought legal battles of all time. I don't know that I fully grokked all of that at the time, but gosh, if I had known it all, it would have like made me sign on the dotted line faster. Like that is why it drives me as a lawyer and as a leader and totally excites me. And it's what I've found.

Cecilia Ziniti22:11
It's funny you say that. Garden tender is a good metaphor. My husband asked me one time, he's like, can you just take an easy job sometime? And I was like, I guess not. Like, you know, it was really the same answer. The answer is no. Okay, so take us to Coinbase. So you're there, you made this career decision, you sought the pain or you sought the messy garden. What was, what are you most proud of in your time there? And then you had some very public battles around Twitter with all of VC watching, all of this community watching the world. Obviously the political context changes what you all do significantly. For someone who isn't familiar with the space, give us a walk through of what you did and a little bit of the from-to journey that you've had in your five years there.

Molly Abraham22:53
Sure. All right. I'm going to tackle this in a couple different ways. Maybe the first is what I'm most proud of. And by far, I would say it's the team that I've built. And I consider it like the ultimate win. Like the things that I actually go and brag to my boss about are when I don't go to a really important meeting with a regulator because someone on my team is absolutely ready to do it. And then I get feedback that they absolutely knocked it out of the park. And I will say, I didn't go to this meeting. Someone from my team was able to cover it and they crushed it. And to me, like that's the best thing I can do and accomplish. I started with a team of two the day I joined. My team is 90 now and my role has changed multiple times. Like I've taken a number of tours of duty, but like the thing I'm absolutely the most proud of is like the talent that I've developed, that I've recruited, that I've, you know, grown while I've been here and, yeah, I'm just deeply, deeply proud of. In terms of the legal journey here at Coinbase, it's been absolutely fascinating. In case for those less familiar with crypto, there's this concept and I do think it's waning as a general matter of like a crypto winter. So crypto tends to be a bit more volatile and you have these peaks and valleys where crypto, like everything's coming up crypto, right? Everyone's excited about it. Everyone's talking about it. Everyone's signing up in the app. And then you'll have these periods. And there was a particular period in 2022, many of the others like long predated mine, you know, me getting into the space where, you know, people called it crypto winter in that the space, you know, there was a lack of interest in the space. No longer saw, you know, TradFi hiring for crypto roles. Saw asset prices decrease. Saw activity decline and you just, it also coincided with a lot of, you know, kind of negative actions from the government in terms of, you know, kind of regulation by enforcement and the like. And so that doesn't necessarily define a crypto winter, but that particular one in 2022, those were some of the elements of it. And so I've been at Coinbase where literally crypto was the hottest thing around, the company IPO'd. And I've also been there when every outreach I would get from, you know, some of my network was, are you okay? Where are you interviewing? Like, how's it going? Are you ready to move on? Wait, you're still, you're still going to keep doing this thing and like just open skepticism, pity, empathy, you name it. And I actually loved that period because like the folks who really believed in it, believed in the company, like saw it through and were even more determined when it wasn't, you know, the hottest thing that folks were interested in. And I think we actually used that time incredibly effectively to build. So that's a little bit about like the overall market sentiment trend. And then the legal work has also really evolved over time. And so obviously there was this period of regulation by enforcement, the SEC sued the company and it was, you know, it really changed a lot of how we had to lawyer at the company because we were launching new products and we were under an active enforcement investigation. And it may have related to different things, but on any given topic, you have to kind of ask yourselves, wait a second, I'm also being sued by the SEC in this moment. Like, how do we, how do we think about this? How do we talk to different key stakeholders about it? Obviously clients wanted to understand it. Other regulators wanted to understand it. And I think that it really speaks to, you know, Paul's leadership and the leadership of the legal team as a whole, how we really kind of saw through that moment. And ultimately the case was dismissed with prejudice. And the SEC and other regulators have just been incredibly open and engaging both with crypto generally, like hearing ideas from companies like ours now. And so not unlike the market sentiment being a bit of a roller coaster, the regulatory sentiment has also been a roller coaster. And so I'm optimistic right now, but I, you know, I'm prepared for anything. It's a really, really interesting company to be at and the legal challenges know no bounds. So I love that.

Cecilia Ziniti27:12
Is there a moment or a particular legal question? I think it's like is cryptocurrency, or there's like some, there's like the rule, the three part rule. I forget. I did have one of my companies at one point wanted to launch a stable coin. And so I briefly learned the law in the area for about like a week. But is there a moment in there where it's like I'm just picturing, you know, obviously Judge or former Judge Grewal goes to court or you go to court. And is there like a courthouse steps moment or a text message you remember getting that's like boom dismissed or like give us that moment and then you know how do you take this, some might call it dry, I personally love tax law but anyways, pretty like you know at least technical question around you know how a financial instrument is regulated so maybe tell us the rule and then when did the rule become emotional, like give us the actual moment and then as lawyers, how can we prepare for that or make it happen? Did you will it into existence? Just like really give us that kind of insider, to the extent you can, insider scoop. And you know our listeners are largely lawyers so give us section references or whatever you would otherwise give.

Molly Abraham28:26
Sure. I'll give a little bit of a high level reference. I will confess this is an area where I owe all credit to wonderful colleagues, but I'll share a couple of fun stories. So a lot of the SEC era of regulation by enforcement came down to whether some of the crypto assets were securities or not. And it goes back to, and therefore should be registered or regulated by the SEC, kind of you name it. And so a lot of it goes back to a case about Orange Grove which is the Howey case and has these different elements of what makes something a security. I'm actually teaching a crypto law class right now and it's been fascinating to kind of go back to first principles. Like we read the white paper, we've talked about Howey and talked through these things. And so what was particularly interesting and I really had, my role was not the litigation role, but getting to watch our head of litigation and Paul lead in this matter. And we knew obviously that the SEC had given us a Wells notice. We didn't know when or if they were going to sue us. And I will never forget that morning. And Paul has talked about this, I think, in a number of places as well. But he was testifying. I don't remember if it was like what committee it was or whatnot, but he literally was testifying in DC. He's on his way into the room and he gets the phone call that we are being sued by the SEC and then he's testifying and we're not able to talk to him. And it was just such a wow moment. And still, I can remember I was on my way to my car to get coffee. I'm a super early riser and seeing the text and saying, okay, do I get the coffee? Because it's gonna be a long day. And really just playing a support role for our amazing, amazing

Cecilia Ziniti30:07
Hahaha

Molly Abraham30:13
...litigation team and Paul, who led us through that kind of existential moment for the company. The thing I admire about how they led in that moment that I've taken lessons from is the transparency with which they led. I think something that's taken for granted, but was quite unusual at the time was even the fact that they put out a video for our Wells notice and openly Paul and our CEO, Brian, openly talked about our engagement with the SEC, why we weren't getting answers and what it is we were looking to get answers on and why we thought we had been Wellsed. And so I just, it was very controversial at the time. And now I feel like companies are going more and more direct, but I give huge credit to, you know, to our exec team for having, you know, kind of courage and being willing to like do something unusual and just be really direct about the entire thing. And one thing that I saw, like as we, you know, as a legal team, obviously impacted all of us being sued by a key party like the SEC. People were just direct and transparent with what was going on, whether it was with clients, whether it was with business partners, whether it was with other regulators and even just the public, and being willing to tweet on different developments, making sure that we put our case docket out there and accessible for folks and pointing them to like what was happening, featuring it in our shareholder letter, you know, here are the latest developments. It was a different approach to transparency in a case that I hadn't witnessed before and just feel like I learned so much from. And I thought was really, really well done.

Cecilia Ziniti31:47
I read something about, you know, we've got this new wave of tech companies of which Coinbase is a part that are, you know, challenging the system, right? So Uber, Airbnb, you know, obviously Uber went up against the taxi medallions, Airbnb, all the various regulations on hoteling. And one of the observers, I think it was the guy from Stratechery, said something to the effect of enlisting the public and the users at the, even if pre-tech companies had the scale, they didn't have the means. So the example that he gave, he said, if you're General Mills and you're trying to protest GMO laws back to your consumer goods days, it would be the equivalent, popping up a notice in the Uber app being like,

Molly Abraham32:17
London.

Cecilia Ziniti32:29
...regulators would be the equivalent of putting a little like a leaflet in your Cheerios and you're like pouring out your Cheerios and it's like call your regulator and you know like make sure that there's no GMO or you know the GMO is fine or whatever the relevant issue is. So in case of Coinbase, how is that concept, or are you championing that concept, because it sounds like that's what Paul and your head of litigation and your CEO Brian are really doing in being so transparent? Do you, what's the, when you're advising on the product council side, you've got this team of 90, presumably you're launching new features, both disclosures and the legal side, but there's an advocacy side too. For those of you listening, Molly giggled when I told her about the idea of putting a leaflet in your Cheerios. How do you strike that balance? Have you done advocacy pieces for your user base? Is that something your team advises on? Maybe you can't say, but it...

Molly Abraham33:32
We absolutely do. And we look for opportunities to flag for our consumers when they might be unable to access something because either of a regulatory reason or whether it's something where it may make sense. There's just a general sense of transparency in candor. So in addition to leading all of our product council, commercial council, I also lead our corporate team. Even the way that we approach, I mentioned earlier, our CEO's Twitter handle is a reg FD channel. That's pretty unique. There's only a few of them. It's just, I think it's very much in our style to be willing and able to be transparent and direct. And like, I welcome it. I think that I will confess one of my first experiences as a junior litigation attorney at the firm at Wachtell was having to explain to a reporter on background development in a case. And we had some of the most brilliant lawyers on answering questions incredibly directly. Like in my naive, optimistic 25-year-old self was like, oh wow, like we're giving them all of this information. We are flagging like both pros and cons of our arguments. Like we're not, we're not actually being total advocates in this moment. We're trying to, ultimately you're always an advocate, but I feel like we were advocating by being factual and transparent. And then to see the headline that came out instead and how much of it was truly just click bait was like my first real exposure to, like the media and even some lawsuits, this is all just an economic exercise. It is not a truth seeking exercise. And so I think that the ability to go direct at times and the transparency with which a number of the folks that I've gotten the privilege of working closely with have been just incredibly transparent. I think there's something to it. I think that people find it genuine and I do think technology has changed. I mean, can you achieve that genuineness and transparency in a cereal box? No, or in a mailer. But we have Twitter or X. We have all sorts of different mediums to get messages out more directly that have changed rapidly in the last decade. And I think it's a powerful thing.

Cecilia Ziniti35:55
So I'm not going to betray my own politics too much, but one of the things that I have observed about some in Silicon Valley, and I've, at least in my kind of experience with advising on regulatory, has been true, is there are some people in tech who take the view that regulators are stupid, that somehow they don't understand, that they don't work hard, that they're sitting in DC or wherever they are. Now, I find that view counterproductive, even if, you know, even if you were to assume that it was objectively true, I don't think it moves the ball. What's your view?

Molly Abraham36:30
I just don't think that's true, like at all. I, between the different companies I've worked at and a law firm, have met with regulators across multiple different tech spaces, multiple different types of divisions of the government. And I've just consistently been impressed, in a lot of different ways. Now, look, there's always exceptions to the rule, but I usually, I think that there are a lot of smart people that sometimes have various different motivations, but I don't, like to me, I don't think, I don't buy into the competency one as like, oh gosh, they don't work as hard or they're not as smart. Like I think people have different motivations at times, but I've met a lot of really engaging, really smart folks in literally every aspect of both government and private practice.

Cecilia Ziniti37:25
How do you advise your folks on interacting with regulators? So obviously there's the famous Zuckerberg, Senator, we sell ads scenario. But presumably you've earned a ton of respect at Coinbase. You've got a big team. You have enabled the company to unlock all these things. When you play that legal role, let's assume as a GC or DGC or whatever position, how do you earn that trust with people? Particularly when you're advising on something that, you know, is not, may not be pleasant. Like, I mean, I can tell you a lot of times when I've advised on regulatory, in fact, I swore off being a GC in a regulated industry after Lambda School, now BloomTech, because frequently what would happen is people would be like, that can't possibly be the regulation. That's ridiculous. Like it literally is like they want us to do whatever thing that is like, bad or not good. And so that questioning that question you talked about at the top of the hour I think comes up a lot but at some point it is a challenge to be like no no, that's the reg. Like this is how it is. We can go to the regulator. We can do public policy. We can do it anyway Uber style, but like this is what it is and I like the creativity I like those aspects of the job, but it was super exhausting. And so I guess my question for you is like when you are educating on something that's like the system, what's your advice? And you said how you hire for it, but how do you actually give the day-to-day advice at your company?

Molly Abraham38:52
Give them the cite. I'm not at all. I think that there, I have had folks on my team before who are borderline offended at the idea that, well, I'm the lawyer and they're not. Like, why would I also give them the cite to the reg? Like they need to check my homework. And I have a totally different perspective on that, which is help show that you're like, this is part of persuading. This is part of building credibility and like, I think that folks who are not lawyers are curious about the law and they also find it befuddling. And I think it bothers people how much of a morass it is, how conflicting it can seem at times. And so be willing to show them, right? And so I'm thinking about something I sent earlier this week where I was explaining why a particular, some other company did something a particular way and like what the relevant rule was. And I said, here's the cite, here's the link to Cornell Link. If you're interested, I give the TLDR, I think probably one in 10 people would ever click through, but a willingness and an openness to say, and here it is, so you can see it. And I'm happy to talk about it. And I think that having that approach, which to be clear has been controversial for some folks that have worked for me before, is more of just embracing, people want to understand if they're skeptical, show them why they don't need to be, and don't be defensive about it. Welcome the curiosity. But I will say that that is a slightly controversial take. Like, I don't know that everyone loves that approach, but I have found it effective, and I'm totally willing to do it. You want to understand it better? Here you go. I'm so happy to talk about it with you.

Cecilia Ziniti40:30
I love that. I definitely, this like, there are definitely people, you know, I think the assumption that others are very smart. We certainly take that assumption at GC AI that users are smart. We're very transparent. And ultimately, you know, if somebody wants to nerd snipe you and look at the reg, like look at the reg. That's what it says, you know, and this idea of like breaking it down. I love that, super inspired. Does AI change that equation? We had someone on the pod say legal advice is no longer paywalled. They're receiving stuff that, you know, people at the company have learned on ChatGPT, receiving draft agreements. So let's talk about legal and AI. So does legal change that? Does it make you up your game? Does it counsel towards the view you set of like, show them the reg. They'll believe it.

Molly Abraham41:16
I definitely think folks should be thoughtful about privilege. Because a non-lawyer asking an LLM for legal advice is not necessarily their lawyer. That said, I love it. I love the curiosity. I love being the one to be able to help someone parse through something. But I think we all have to up our game. And lawyers who are not deeply embracing AI, I don't think law is going to become extinct. I don't think in-house legal is going to become extinct. I think in-house lawyers who do not embrace AI will become extinct. Like we have to be like the absolute kind of power user, protector, enabler. Like I think that legal has a number of critical hats to play with respect to AI. And if you're not like starting to wear those hats and like embracing it as one of your top priorities, I do think you're going to become less relevant to an evolving legal profession.

Cecilia Ziniti42:11
So you mentioned privilege. How are you, like how do you think about privilege and then with AI, do you think the court's ruling was right? And, you know, for me, like the, so with the US v. Heppner case last week, basically found that, you know, folks putting questions into generalist tools without a promise of confidentiality that is not privileged, non-lawyers doing that. So how are you, how are you advising on AI at the company in the context of privilege, in the context of what you do, in the context of, I'm assuming you've got lawyers in every Slack channel. I personally have litigated privilege on Slack. I think one of my companies made law in the area, which you never want to do but anyways. What's your thought on kind of privilege, AI and how you advise on AI at Coinbase? I mean privilege, you can't talk about privilege. Whatever, but anyway you get the question.

Molly Abraham42:56
Yeah, I'm glad to. Yeah. I totally get the question. I think it's a great one. And you've got to follow up with me on that case because I want to hear more about it after. But I think about how legal leaders should think about AI through three different hats. One is an AI enabler. One is an AI protector. And one is an AI super user. So as an AI enabler, I think legal is particularly situated to help unblock the use of AI tools across the company. People worry and think about things like confidentiality, like privilege. Like what do I do with MMPI if I'm at a public company and how do I engage my, you know, my AI tools for the most sensitive information? And I think that, and you know that your employees want to experiment in this area. So if you don't get ahead of unblocking it, like, people will find a way and you want to do it in a way that is safe, which I'll get to on the protection front. And so for me, like I asked my team, like we need to not only help in terms of legal analysis of any AI, you know, from a product counseling perspective, but how can we help accelerate, you know, new tools that engineers are trying to onboard? How do we think about the contracts for those vendors differently? And so we have taken the mission to like be a team that can like accelerate AI tools for other teams. So that's kind of one hat. The second hat is about protection. I won't name the company because I'm worried I'm going to get it wrong. There was a company at one point who, gosh, it's been about a year, who sent out some sort of notice of FYI, all of the data you're sending through us, like is also being used to train our LLM. And it was for information that would otherwise be treated confidentially. And I remember everyone was immediately in an uproar and the company ended up rescinding it. That said, the first thing I did when that came through is for my commercial team, we looked through every agreement where our data was being processed in some way to ensure that it wasn't being used to train an LLM without our permission or our knowledge because if something else ingests your confidential information and can spit it out, even in a transformed state, like that's still your confidential information. So we thought about, okay, how do we protect the company? And training and making sure folks understand privilege? All of that is part of that protection role. And then the last piece, and this is where I totally going to need your help more, is like how to be an AI super user. Right. And so the place where I feel like my team is excelling is thinking about, how can it be the case that we are not, like any agreement that's on our paper, we should not be taking the first pass at red lines. We have playbooks that we've developed. So how do we make sure that we're using AI to do that? The thing I haven't figured out, and I'm going to confess, I am at like basic level zero, is how to actually use AI to improve my productivity. I feel like I have been able to unlock AI for my company, protect my company on AI, and also use big scaling tools to say, maybe we don't need to hire as many commercial lawyers this year because we're going to use these tools and we're working with various vendors. I have not figured out how to unlock my own daily productivity with AI, and that is my mission for the month.

Cecilia Ziniti46:16
Amazing. All right. So many threads to pull there. I literally am like I made in my notes seven things to ask you. On the company using all your data, I know exactly what you're talking about. It turned out it was a, it was almost like a faux pas of legal, but it was Adobe, and they had something that had been in their terms for two years. But someone noticed because the terms were re-popped when they basically did some new thing in designer and then Twitter went absolutely nuts. And it was very similar to when Instagram changed their terms, maybe like 10 or 15 years ago even. It was like, said it was sloppy drafting and basically said Instagram owns everything that you have ever done. And people flipped out and similarly for Adobe it said, it had similarly kind of somewhat sloppy language that turned out not to actually reflect what they were doing. But you're absolutely right. Adobe rescinded it. Adobe put out FAQ. It was a big lesson for product counsel. So my question for you is, presumably you and your team are right in terms of use every dang day. So, and how do you not have, let's just call it an own goal on Adobe's part, not your words, mine. Let's say, do you avoid an own goal? And Adobe, if you're listening, I can sell you some legal AI to help with drafting, which is our next topic.

Molly Abraham47:31
We're pretty thoughtful about any terms that we put out and we also have created a framework now for any agreement that is coming through the commercial teams specific to AI to really, sorry. So the framework is specific to AI, but it's for all agreements basically that we are looking at it through the lens of, okay, what if this company that is right now just providing marketing services, all of this, and it becomes an AI company. What if we said about our data, how can we make sure to protect it? And so that's the lens we're taking it through to make sure that we're trying to see around corners as much as possible. I don't know that anyone could have seen around this corner three years ago. Maybe just a select few, maybe you.

Cecilia Ziniti48:12
Hahaha Amazing. Alright, so let's talk about super users. I do think, like product council, my biggest advice is always, you know, that using AI, we find that teams on GC AI, we're at 1400 now, feel very lucky, everyone from kind of Bass Pro Shops through to Miro, through to Hitachi, but we find that product council who use AI end up having way more empathy and ability to be that enabler than those who don't. So, all right, so super user, so what have you tried? And maybe I can real time diagnose slash provide advice. So are you using general tools or what's been your experience kicking it off?

Molly Abraham48:51
Okay, so what I have not done is I have not created an agent. It is literally on my list today. I found a friendly engineer who said, I will totally hop on and help you. What I have done is I have, I've been using, we use Gemini, I have my own Chat GPT subscription. One thing that I've been trying, so I've mostly been doing it for research on a day-to-day basis, but one thing that I've consistently done is I put my research in multiple tools, pretty consistently at the same time, because it is a helpful cold dose of reality sometimes to see the differences that come back, because the answers are so polished and thorough that it like lends itself to credibility. And then you realize, wait a second, I did not get the same answer. And now I'm digging into the difference and both of them miss something. Like it's not perfect yet and we can't over-rely on it. But so I would say I'm a researcher at this point. I have not yet found a way to like build an agent to like unlock my own daily...

Cecilia Ziniti49:49
Yeah, so GC AI, funny story, we almost called it Product Council AI. Because I'm like, look, every AI is so hyper focused on contracts, which makes sense because there's four corners documents. So the AI can focus on those things and do retrieval argument to generation or rag against those documents. But I guess here's what I'll say. I think you're right that models have different personalities. There's different things you can do on precision. There's also, I would say that, you know, in these areas where, you know, no AI is going to know more about the Howey test than you do. Like you could recite it backwards with your eyes closed, right? And so like, I think my advice might be to start with lower stakes things, to start with an agent, make friends with your engineers is great advice. But I guess here's what I'll commit to. I'll commit to a personal kind of demo and class. So let's do that. Let's do that. But yeah, so look, very excited. But also you can be inspired that, you know, we've got

Molly Abraham50:36
Amazing.

Cecilia Ziniti50:42
...this incredible tech lawyer from Wachtell and math major and patent holder is basically experimenting with a lot of AI, but hasn't found just the right one yet. So that's actually like, I'm inspired. I think our listeners will be too. So awesome, good stuff. All right, so let's move on to the lightning round. The best career advice you've ever gotten in two words or two lines.

Molly Abraham51:03
Be dispensable.

Cecilia Ziniti51:05
Wow. Okay, all right. I'm gonna allow you to unpack that one with two more lines. What does that mean?

Molly Abraham51:09
I think it is easy, especially early in your career and for some people later in their career, to believe that the most important thing is that the company would not survive without them, that they're absolutely indispensable to their exec team, their boss, et cetera. I feel the opposite. If I am doing my job, I can get hit by a bus or win the lottery tomorrow and my team will continue to function excellently and the company will not miss a beat. Like my role as a seasoned and senior leader is to build a bench such that the company does not need me. And it ends up also working out for my own career because every time I do that, I'm able to take on more responsibility or a new or exciting challenge. But that is what leaders owe to the companies and their bosses that they work for. And something that I think is not everyone's typical take, but I try to achieve every day.

Cecilia Ziniti52:00
I love that. A book or movie that's inspired you over the years.

Molly Abraham52:01
This is hard. Okay, I'm gonna go a little off the beaten path. Matilda is my forever favorite book. And I am a reader, I'm curious, and I think at the end of the day, part of the reason I'm not a garden tender is I am a lifelong learner. And if I could go back and maybe go to medical school in my 40s, I totally would because I love learning and it's what's kept me in my role for so long. I feel like I learn something every day.

Cecilia Ziniti52:10
I love that! Thank you for being here, Molly.

Molly Abraham52:33
This was such a pleasure and so much fun and I can't wait for all the AI things you're gonna teach me next. So thank you so much for having me.

Cecilia Ziniti52:39
So much fun.