[2023] Why Public Goods are Good with Vitalik Buterin

Transcript

foreign [Music] podcast if you're just joining us we are building a coordination a network Society of thousands of hackers dreamers and doers using crypto to bring positive sum digital systems to the world this podcast features the people who are doing it and is published every Tuesday and Thursday if you want to learn more visit our website at greenpill.network where you can download the green pill book for free join the Discord and become a member of your local greenfield.network chapter my guest today is vitalik buterin the founder of ethereum and we talk on this episode about metallics interest in public goods why does public goods matter to vitalik Booter and we talk about his vision for

public goods funding within the ethereum space but also how ethereum could export public goods funding to the world we talk about what is exciting to vitalik about the public goods funding space in ethereum in 2023 we talk about the highest leverage points in the public goods funding ethereum space and we talk about vitalik um basically what parts of the space do you think are underfunded and where we need to make investments in order to build more momentum in public goods funding so this is a special episode for me because vitalik in many ways is the Genesis uh creator of ethereum but he's also the creator of our value set around public goods in the space Not only from a pragmatic point of view ecosystems

that fund their public goods are going to be the ones who are winning but also for the uh the goodness that comes out of public goods and so um you know vitalik's a a hero mine I'm sure that for many of you he's he's a hero of you as well and so it's just a really fun opportunity to interview the inventor of ethereum and the inventor of quadratic funding about some of the public goods in the space that that he's building so I think this is a good snapshot in time for where public goods funding in the ethereum ecosystem lives in 2023 and I am very excited to present to you coordination to present to you vitalik looter and enjoy Valley Dao is open Global Collective working to finance and democratize the governance of synthetic

biology Technologies to protect the future of our planet research and progress into synthetic biology is critically constrained by the world of nation-state regulations and bureaucracy from middlemen but the potential that synthetic biology has for the world is massive it can produce a world in total harmony with nature we can grow stuff using cells like software it's awesome and the best part is we no longer have to pull carbon out of the ground to grow and maintain civilization don't you think we should be funding this Valley Dow does and that's what they're here to do to try and make the solar Punk World of Tomorrow a reality today so join Valley Dao right now and save the planet at valleydow.bio I have a teleco are you good Kevin how are you pretty good thanks thanks for agreeing to do this

podcast with me I wanted to dive in on public goods funding in the ethereum space could you start teeing us off by talking about why public goods matters to you and why you've sort of imbued that as a value in your writing in in your work sure I mean I think the fact that public goods are important like both ethereum and just any crypto ecosystem I think is just something that becomes super obvious once you spend enough time in it like all of these ecosystems depends totally on open source software on protocol research on things that once they get created benefit everyone in the ecosystem but it's uh that still needs to somehow get funding for them um and I think um within this space we

also see lots of instances of situations where when a public good version of a thing does not get developed often much more centralized versions of the thing that are much more limited and give much less power to users get developed instead and there's just lots of examples of this I feel everywhere in like both ethereum and the crypto space but then I think it's also a pattern that exists across the yeah internet General and you know even just all the different parts of the offline world right like scientific research is a thing that all of cbidity really benefits from right and you know if uh one guy figures out how to make a solar panel then and you know that's more

efficient then everyone can go and go and start betting benefiting from that everyone gets better electricity and then on top of that everyone benefits again because polluting sources of uh and energy decrease because there's more there's worlds relatives to them um so there's just like so many different instances so where there just are these really important things where they need to be created they are valuable but uh they have this property that you know once they are created like either they don't get created or released at all or they do get created and they kind of benefit everyone without being able to discriminate between like people who hated people who didn't pay and being able to have good ways of funding these

kinds of things is just a really important challenge so in hearing your answer there I couldn't help but notice that it feels like funding public goods is a practical matter just it's what's best for the ethereum ecosystem but it also feels like it's it's something that's good for society even outside of crypto ecosystem public goods when you think about ethereum and and public goods funding are you thinking more about tangible matters of public goods for the ethereum ecosystem are you actually thinking this will be one of the biggest exports as ethereum reaches scale if it becomes a backbone of an Internet Financial system that it'll actually export public goods funding sources and mechanisms to the world some of both um I think one thing that's important to remember about public goods

is like all kinds of public goods exist that have different Scopes right and like almost any public good is that Scopes to some kind of community I mean I think uh minox things like uh you know fighting against climate change as I mentioned it's like the like the closest thing we have to an exception because basically unless you're like Canada or Russia or Norway the Earth's temperature going up is like very significantly bad for you and so that covers I mean like most of the planet uh but if you think about things like let's say for example creating translations of blog posts uh let's say not even about crypto let's say about like chemistry into Turkish right like that benefits people in turkey that benefits turkish-speaking

communities in other countries that particularly benefits people who care about chemistry right so I think every public good I think is uh attached to some particular community and Manoa ultimately Asia the you know there are some that have these extremely large Scopes and there's definitely some who's uh scope Commerce Clause still approaching basically all Humanity but then there is also all of these uh public goods that have smaller Scopes and I think they're both important the way that I see I see a theory I'm playing into this is that I think uh I mean first of all public goods are just obviously hugely important for ethereum itself and there's a lot of like very specific properties of the ethereum ecosystem

that make them even more important than usual right I think uh the fact just the decentralized nature of the space makes it even more inadequate than usual to have a yeah centralized version of a solution to any particular problem and the challenge is that if you create a decentralized solution then often enough it's not going to have a business model for the Creator baked in and so you know it does become a public good right like if it's uh decentralized that you know you can't have some kind of Gadget in there that discriminates and like only makes a thing available to people who contributed to paying for it um So within ethereum itself I think they're super valuable and I definitely

do have this hope that the ethereum community can be a testing ground for these mechanisms and once um the mechanisms get developed and perfected here they can be exported and applied to a whole bunch of other spaces as well right because I think ultimately those spaces are facing like basically the same kinds of problems but sort of basic intuition is that the properties of blockchains that you you get when you build a public goods funding mechanism on top of a blockchain uh transparency uncorruptability globalness and programmable uh programmable State machines would be a really big Advantage for building public goods funding mechanism isms that uh disrupt state-based funding mechanisms which are

not transparent which are arguably less accountable to um to their constituents and and so it feels like blockchains give a lot of really fundamental advantages when it comes to designing a mechanism that's more democratic or accountable to a population of people and and I'm wondering if you think is is that a competitive advantage that will help blockchain-based public goods funding mechanisms disrupt traditional ones in the future do you have any sort of vision around that yeah it's a it's a good question I mean I think blockchains in general are very good substrates for implementing systems of rules and basically me implementing them in such a way that they're transparent

like everyone can see what exactly the rules are everyone gets a guarantee that the rules are being followed um it's uh you know all being done in a way that where it becomes much harder to cheat and [Applause] those things are definitely valuable right like I think the courses the analog to this is just like Democratic voting systems right where yeah like people you know not being able to cheat and the rules being open as something that's like incredibly crucially important but I think public goods are just like so diverse and so Dynamic and so rapidly changing that the whole kind of paper-based let's have an election once every four years saying it's just totally not going to work for them right and and so I think I'd watch ins are in very well positions to be the home of

some of these uh economic academics that try to and do a better job of like identifying which public goods to find the directing resources toward them yeah I kind of think of our work in blockchain-based public good systems as high resolution democracy just look at the 300K data points we get per Bitcoin grants round uh and compare that to voting once every couple years in a local election in in analog democracy and it makes me really excited about getting a high resolution map of what constituents care about you know quadratic funding is is not perfect but it is a high resolution sort of system that people will actually participate in so high resolution democracy is is a meme that that comes up in my mind

um I'm not sure if you have anything to add on to that yeah no I think it's an excellent frame I think I I might have even used it in one of these Universe something that sounds similar to it in one of my posts myself a couple of years ago like okay you didn't like social media as a yeah currently you know somewhat dysfunctional but potentially really improvable uh version of high resolutions democracy is like another one of those kind of metaphors to think about yeah um speaking of social media and public goods um I don't know if you saw about myself and raid Gill launched a version of quadratic funding on lens where every lens post is a grant and every tip is a quadratic funding uh contribution and

we're able to raise 20K for anyone who talked about ECC uh in France this year so my basic intuition there was that you spend 15 minutes per quarter funding your Bitcoin grants but what if public goods funding was imbued into our social media atmosphere uh and it was a way of upranking what was good for the public goods not just uh what gives me a dopamine rush so I'm looking forward to experimenting more with forecaster and lens and web3 social and integrating public good funding mechanisms into those yeah I think that's beautiful what are you most excited about in the public goods funding space I guess maybe starting within the ethereum public goods funding space so to be the public goods funding space basically has two house to it one half is figuring out where the money comes

from and the second half is figuring out how to allocate the money and both of those are hard problems right and they're hard problems in different ways and so as in terms of like just ways of uh this collecting capital I mean yeah I feel like this is a thing that's been just solely organically improving within the ethereum ecosystem over time like uh I remember even back in uh 2020 I I think I remember there was one time where you were on bankless and um you know the state of the Banco station is fun ding and uh you know the whole episode was like about how everyone was so excited that like finally other projects and like you know not just like but wasn't like myself in the ethereum

foundation a couple other people are actually willing to contribute and until now you know we have not just Equity contributors we also have optimism which is basically made a long-term commitments to keep putting uh funds into um retropgf pretty much forever I mean okay without that announcement well what was that was it like an ether ETF or something that promised to like put 10 of its profits into protocol jailed for 10 years or something like that recording this on Sunday night Vanek the ethereum ETF uh announced on Saturday that they were going to give 10 to protocol Guild which is hugely legitimizing uh I think to them yeah uh but a great source of funding for protocol Guild yeah yeah I think that's uh that's amazing right like uh like to

me I think the biggest thing has always been like trying to move from one-time grants to having steady sources and I think uh you know like optimism positioning itself as a steady source and you know the Vanek ETF position itself as a steady Source like that that's amazing right so that I think I'm happy that uh you know we're moving toward more progress there um and then the second problem I think it's always it might actually be the bigger and more according problem and and one of the reasons why is because the better that problem can be solved the more I suspect people and organizations would be willing to donate to it is like how do we figure out actually which projects to fund right

like if there was a strong effective and credit neutral part where you just know that if you throw money into the part public goods projects and people behind them would actually be here compensated and it'll get started away that's like reasonably fair then that's something that lots of people would be willing to like potentially automatically airdrop to and so forth right um so that is um it's a big challenge right I mean obviously quadratic funding and racial funding are two of the mechanisms that are are really trying to go in there I think um probably the biggest challenge that I see is basically yeah creating higher Fidelity sources of uh

information about like who contributed to what what projects are Upstream of what other projects probably helping to better surface uh projects that are really important but that are less visible but basically trying to find and support things that are two or three steps behind uh things that are in the public eye reduce people's um you know feeling that they need to Market themselves and talk about how cool they are in order to get more funding and like basically yeah really start solving some of those problems right and so I think uh in the case of optimism RPG also one thing that's interesting is that they're starting to like I think experiments with moving towards some

some kind of Delegation and some kind of multi-layer structure the yeah thing that I find interesting about the work on hyper certs is that it just basically yeah standardizes the whole model um then I mean I saw that the guy on your applied yes he talks you'll forget the name the founder of t.xyz right yeah Max how old right Max so yeah my understanding of that project is like it's obviously Premier League is on just a yeah package manager which is important to good by itself but it's also trying to like actually figure out sort of what is the contribution graph and like what things are responsible for uh or dependencies or contributing to what other things and

like actually do a better job of uh you know kind of automatically collecting that information and and making it easier for people to kind of fund entire ecosystems instead of just individual projects um so I think that's cool right I think uh it's good that there's all of these different pieces of the puzzles that are getting developed and I think what I would hope to see is that you know I mean standardization obviously like it it will be nice if we had um an open standard for each piece of the puzzle and then aside from my dismal collaboration between the different Warriors of the stack obviously right like you know it would be nice if some of these systems actually yeah he's used and built on top of the

tallest I got created for the other stack and yeah just basically yeah moving forward to having this ecosystem where it becomes more and more normalized for people's contributions to public projects that I mean like to get recorded and uh recognized automatically let me just play that back I asked you what you're excited about in the public goods funding space and then we talked about the difference between funding sources and mechanisms and it seems like they kind of have to grow there's like an impedance matching between funding sources and mechanisms um and so within funding sources optimism is doing great things on sustainable recurring funding and then the protocol Guild and just people

contributing back to ethereum protocol according development on on beneck um and then in mechanisms we covered uh retroactive public goods funding quadratic funding protocol Guild I guess Trent calls it a self-curating registry which are sort of interesting mechanisms um and then you sort of talked about the kinesian beauty contest issue with mechanisms where the stuff that's the most visible gets funded and and so how do we solve that and then I think you kind of drilled in a little bit on open source software funding and the opportunity with uh T dot XYZ uh to create a dependency graph of all the different for an open source packages and that way you can track their impact and and fund below the surface a little

bit more and and then you said standardization uh everyone working together and having it sort of normalized to fund public goods would be the sort of like I'm really interested in figuring out what the highest leverage points are for Builders inside of ethereum spaces so you know what do you think the highest leverage points are for the average Builder who has software skills or design skills or copywriting skills or memetic skills to contribute to building this movement of public goods funding in the ethereum space one interesting place to start where I feel like there hasn't been much work on yet is like basically taking existing data sources on the internet and about people's contributions so I give in just things like GitHub Cadet records um and

each research posts and similar things and I mean first of all just like standardizing those as data sets and trying to like in data and some format that's a kind of a better match to the actual problem which is basically identifying like which project is a dependency of other Pro of which other projects and which person qcubated how much to which projects at a particular time like that feels like something that should be possible for anyone to just like go and do independently right and like you can probably hacker find out a proof of concept for like hey yeah I'm gonna like Hero at the top contributors to this project based on GitHub data um and uh I mean obviously it's the sort of

thing that uh it really yeah needs to be careful of done carefully just because like any way of measuring actually uh people's activities is going to inevitably overvalue something some other value other things at some point that's just once you accept the mechanism in stone it's going to be games but you know at the same time the nice thing is that you know contributions made before this meme becomes a thing or probably not going to be not going to be gamed us watching so you know you can start from those and you can reward those I like yeah I think it's probably I mean this is the nice thing about that and build retro right is that you can also kind of fine-tune the details of the mechanism

retrospectively after the fact yeah I think that's that's one place to start um and then I'm trying to integrate that into some of these existing systems like does that make sense to have a thing that like Auto prints hyper certs on some way or two based on records that have already existed so it feels like what we're trying to solve for here is better tracking impact as it happens and then that makes it easier for Builders to build mechanisms that reward that impact with profit right exactly if we can like standardized data sets of that of the form given Project X here are projects a

b c d e blah blah that are its dependencies and here's the percentage share of contribution of each one of those to X and then also given project like um you know like why who are the people that directly contributed to it during particular time periods and what is their share like if you just have even open data sets of that form right like then that becomes something that's uh quite easy for people to just I could go and use in Russia bonding mechanisms in the future becomes quite an interesting onboarding experience where if we have all of web to open source software developers getting onboarded into crypto by receiving money for the impact that they had instead of you know buying a bag then that's a totally different you know go to market for for crypto or first experience with crypto

for those people and those are influential people uh for influencing the rest of the world to use crypto I'm wondering um what would be the incentive of our project to give back to their open source dependencies is that just good marketing is you know like why not just free ride uh I I guess I always come back to how do we solve the free rider problem when it comes to people actually giving to to these kinds of projects how do we solve the pre-order problem I mean compensate the people who are not free writers right that's kind of what we're trying to do yeah um is there anything else within uh impact tracking um in in smarter mechanisms that you're excited about yeah I'm actually one interesting particular thing is um when we start thinking about

rewarding people for impact with rewards other than money right um so like to give one example uh so Taiwan has this uh gold card program right where it's basically a yeah Visa that allows you to listen work in Taiwan for a three years basically yeah kind of equivalence to a resident's uh permit though we know definitely focused on additional Nomads to some degree as well and one of the interesting things about the Taiwan gold guard is that it has a rule that one of the ways that you can be eligible for it is if you show that you've been actively contributing to open source for the last eight years right and like that's new right because

uh normally you know we think of governments like immigration authorities as being pretty stodgy people and like they really care whether or not you have a degree of Harvard and if you work for a company like she'll be your salary and uh and things like this but I mean like here we see Taiwan like actually being interested and Innovative in that particular way right and what I think is interesting about that is that that is a reward for people who contribute to open source but at the same time like it's not a cost to Taiwan right it's a benefit to Taiwan and in fact the better a job they do of identifying people who are like actually deserve it in the

sense that like actually have made valuable contributions to open source not only will that it makes it better for the contributors and for the world but it'll also make it better for Taiwan as well right because uh like if you uh find higher quality contributors than like you're rewarding higher quality work but at the same time you know you're actually yeah you know getting the higher quality people to come to you so that's um something that you know can be replicated within the ethereum community it's a sub extent right like I think the protocol deal that I believe also has a rule that like if you're in the protocol Guild you get like free tickets to participating conferences or something like that right but we're which I think is that again one of these very smart

things right because that conferences are these very kind of network dependent Goods in that maybe the ticket costs 800 but if you give a ticket to the right person you're not satisficing a hundred dollars so it might actually be benefiting quite a bit right like there's uh you know the Trope that like actually yeah 80 of the value of a conference has nothing to do with uh you know like what people are blapping on stage it's um All About You know the networking and the people and the informal discussions and so you know if you bring the right kinds of people and then like that said I see which like actually value ad for the conference as well and so basically I view this as this kind of untapped Arbitrage opportunity in the

sense that if you can like basically there's a high correlation between people that are good contributors to public goods and people that are just good to have around in a lot of contacts or places or situations um and so if you have a good way of identifying those people then like that could also be a yet not just a way of determining who gets money but also a way of determining like who gets the the ability to participate at conferences events potentially yet you know like immigration into countries uh potentially yeah kind of like virtual forums and all kinds of things and that's a reward that is uh you know

because therefore much cheaper to give right because the better a job you do at identifying public goods contributors the more you're actually identifying people who are bringing value to your network and uh increasing the value that you're giving to the rest of all of your paying participants and like yeah this this seems like the sort of thing that is uh sort of done you know it's been done informally since the dart of human civilization but like really creating larger scale formal mechanisms to do it seems like you could also unlock a huge number of opportunities as well and like what's interesting there is that you can basically reuse a lot of the same rails right like you can reuse the

same infrastructure for this Urban and cook distributed to what project and you can use that both for funding and for uh giving these kinds of non-monetary rewards and then the people who are giving that on the monetary Awards like they're actually benefiting from this and so they actually have an interest in participating and contributing to this infrastructure and helping it to make to become higher quality right so I think that's something that's also interesting it probably could be yeah I've done a lot more like I think there's a really untapped opportunity for some kind of synergy there yeah and it feels like in a lot of ways that would be realizing the vision that y'all put to put forward in the decentralized society paper um but this is just a very public goods Vector on it is getting social social

capital out of your contributions up Goods speaking of network phenomenons I was wondering if we could talk about retroactive public goods uh a little bit um I've just really been obsessed with this idea that if there is hundreds of millions of dollars of retractive public goods funding and I don't know let's say 10 years from now 2033 then it makes sense it's rational for someone to start contributing to public goods today uh on the assumption that eventually they'll have an exit or a huge financial opportunity into the future I know this is a vision that you've talked about in the past how do you how do you feel that that's going in what ways can we support the creation of this sort of reflexive network-based uh outcome outcome for the world it feels like a very high leverage point to me

yeah absolutely I mean I think uh the big thing right now is that it just needs to be happening regularly enough and on a wide enough scale that people can start to expect that uh you know if they do something that is valuable then they're going to get a retro reward of some kind we've seen quite a a lot of our projects get rewarded but like it's still a relatively small number of uh you know relatively big you know kind of big and early sign of a long time and established ones and it's one said both scales up a little bit more probably scales up into the in the uh diversity of things that it's funding and it just uh has a longer established history and

so people become more confident that this is something that's here to stay and this is something that's going to exist for me three or four years in the future that's going to contribute to this ecosystem where it just becomes one of the things that actually motivates people to contribute right I feel like we've seen this happen with quadratic funding to some extent right but I think the more diverse sources of funding there are the better it is actually yet for individuals like even from a risk mitigation standpoints right because like if people are getting funding from multiple sources then the risk is much lower than uh both of them are going to disappear on them at the same time there's this idea of um anti-fragility

coming from diversity if you're a public goods funder say you're left Harris from Rock Rocky and you're getting funding from Bitcoin grants and clear funds and also retroactive public goods funding on optimism and there's also I think Dow drops is doing retroactive public good funding and I'll just throw and give it right because Griff and I are friends then the diversity of income sources kind of creates anti-fragility against any one mechanism or any one project right exactly and I think this is also another one of these reasons why yeah thinking about look funding contribution graphs instead of just like looking at each project individually can be valuable right because uh if you think about like even something further Upstream than that something like Rocky if you think of like even people who

created the ketchak hash function for example like I believe they got a bit of a reward from rpgf but like basically the kinds of people that uh you know the internet had that fatal bug 10 years ago because it turns out that because yeah exactly the open SSL people will be getting like four thousand dollars of donations or something like if you just create all automatic Decades of the text they'll like hey actually like 500 things are Downstream of you and and so you automatically get percentages of uh things that go to any of those 500 things then like that's I mean like 500 away redundancy for the funding to exactly those projects that are the most uh you know critical for the the ethereum space or for the net to stay

standing this actually reminds me um Zach Cole and I have been working on an EIP 6968 uh we almost got 69.69 um but it's contract secured Revenue which is basically a mechanism that allows you to um basically any L2 that enter integrates contract secured Revenue uh any smart contract that is that is called the gas from that smart contract that is not burned uh 1559 style will go back to the deployer of that smart contract so you can kind of create a sort of rewards mechanism for smart contract developers it's interesting like I thought about this like I've actually yeah come up with that I think a yeah a similar idea a few years ago it's uh I I wonder if I can find it in

uh in real time okay there we go developer incentivization in protocol contract answer key rebate 6179 uh yeah yeah basically yeah the main criticism of stuff like this is that it's just a little bit too easy to get around in the sense that like if I make a contract then and then there's an inner protocol rule that says that like this so let's say there's a 25 rebate going to a contract developer then someone else can just Fork that contract and uh if they Fork that contract then they can go and like put in a 24 rebate going to the user and then it's going to be in the user is interested just like use that version instead yeah yeah and so kind of

in the limit it becomes not super different from uh essentially donating or tipping um so that's like the criticism that's usually given um okay pause to these kinds of ideas and like the thing that I came up with in 61.79 actually does try to do a clever thing that basically tries to make it uh sort of a little bit more robust against people making Forks but it's still very far from perfect but yeah I think uh but if you want this in general I mean you know you've read all my posts right like uh anti-collusion is an incredibly hard problem and that if

we don't have like a good sort of protocolizable solution to that then the next best thing is to try to keep reward mechanisms uh sort of off-chain or at least a kind of one step removed from the yeah protocol logic so that if it's discovered that they're being taken advantage of them like that then that reward can be patched in some way yeah I mean like I I do really yeah appreciate the uh kind of reasoning behind all of this stuff right like I said it's a really valuable to just like have this very simple and direct mechanism that's like you get paid in proportion to how much people use your library like I think that stuff is uh super beautiful but I think it's

definitely worth thinking through like what exactly is the version of this that minimizes these kinds of issues yeah for sure well contract secured Revenue we're going to take an L2 Centric approach and I want to get it deployed on the public goods Network um which will obviously attract more developers to the public goods Network My Hope with the problem you described was that people won't use a copied contracts for the same reason that you don't use the forks version of zcash that doesn't have the founders reward in it because it's less legitimate it does have Zuko's name attached to it it's not the one that's supporting all the Privacy research like there's going to be a legitimacy aspect to choosing the right contract would be my hope but we'll see when it gets born out right I mean yeah I mean that's fair I mean the

challenges that I think these little jwc things really get depends on network effects and like contracts don't really have Network effects at all like I think this case since uh the more comparable situation is kind of like pirating versus not pirating right where a lot of the time like uh Empire rating is very possible and whether or not people do it just has to do with their day-by-day feelings about the uh ethics of the situation which often you know exchange drastically based on like how well the major media companies are behaving and whether or not they're doing stupid stuff like making contests completely inaccessible at certain countries or whatever um yeah I mean I I definitely support it as an experiment like I think if you

asked me to plug the hole in 10 seconds I would say yeah I'm you know you can uh delay the rewards by 30 days and then have a governance Gadget that can uh potentially yeah okay shut off Revenue going to individual um contracts that will that look like they're Forks but or you can just like try pushing it out without controls and just like see how it goes and all the responsive problems if they actually arise yeah for sure the more like laissez-faire approach would just be to deploy it and then um yeah iterate towards that's not a dissimilar to what we've done with Bitcoin grants which has a huge collusion Problem by virtue event quadratic funding just make the Civil resistance a little bit better every single quarter

yep there's one quote that stood out in your most recent interview with David from bankless I think it was uh the permissionless interview you said something and I'm paraphrasing here uh it which was uh Dow governance and public bids funding are in many ways the same problem uh and I think you were talking about within the context of Dao uh a Dallas public goods um I wonder if we could click and zoom on on that uh do you remember saying that and exactly what you what you meant there I do yeah I mean I think what I mean by that is basically that uh like ultimately both of those are subcases of the problem of uh just having a decentralized mechanism be able to make this arbitrary decisions where the quality of those decisions is

something that is just not like mathematically provable or verifiable by the protocol in any way so in some ways it's like the problem about speaking uh you know looking back at this for groups of people to agree on stuff with like no simplifying considerations whatsoever and uh yeah like Dallas making decisions and uh choosing which uh projects to fund for public guards or kind of their both just different aspects of that though I think I did later that I've also mentioned that like there are some practical differences between the two which is basically that's uh public goods funding is uh much more likely to be concave than um Dallas I'm making

um individual decisions right because uh like doubt decisions could potentially be very big right like if you think like one particular example is like imagine you take something like Rye right which is a stable coin that's tracking the US dollar but then let's say 30 years from now a crazy situation happens at the US dollar hybrid flights but then rye as a currency like it has a community it still needs to be useful it's a user is still milk even if they thought they wanted to track this or they have a deeper underlying bead which is to be financially safe and so maybe Ryan just has to make a sudden decision of like Hey we're going to deep Heck from The Dollar and from this point forward we're going to follow like some particular version of the CPI or as a hero or gold or something else right and like that's

a very yeah kind of binary flip sort of thing and you know who yeah sometimes like in those kinds of situations they don't really want to compromise what you probably want is that like being able to choose a particular path like stake it out and then be resoluted sticks to it but with public goods funding like for the average situation if you have two projects then like flipping a coin for which one to give apps is generally less good than giving both of them X over two there are exceptions right so like for example if we want to maximize the probability of us going to the Moon then I think uh giving 50 billion dollars to one randomly selected person in the world is probably better than giving

each person in the world uh you know like seven dollars but uh like most things that we do are not on that level of scale right and you know most things that we do outside and it's kind of much more marginal what the benefits are oh I think that's a good overview of con concave versus convex decisions uh if you search vitalik.ca uh and you search for concave versus convex you'll see a visual graph of that and uh really helped me Meek Rock the decision um or sorry uh Rock the concepts have you heard of um vitalik there's some some mechanisms that uh help turn um Democratic decision making into more binary decision making I don't know if you've ever heard of uh Assurance

contracts I have yeah there's a great yeah Assurance contracts are basically a mechanism where you can say I'm going to run a fundraise and if it gets up to x amount then it'll be fully funded AKA we can go to the Moon um but if it doesn't then everyone gets their money back and it's sort of a way of migrating between a concave and convex decision so I'd be curious to see if those kind of gadgets be used more in the public goods funding space Oh yeah it's interesting I mean I remember when uh Alex tavarott crew I came up with dominance Assurance contracts which are a span on Assurance contracts where basically there's like some some entrepreneur who agrees to give people even more than 100 of their money back if the project fails he made a post on marginal Revolution I believe uh

responding to quadratic funding basically saying like hey actually quadratic funding could be combined with Assurance called Truex or dominant Assurance contracts and that might be even better yeah one of the projects that's going on at get coin right now is taking us Beyond quadratic funding uh the new protocol is called aloe protocol which is short for Capital allocation protocol and the plan is to to build in quadratic funding of course we've already got but quadratic voting badge holder based voting um conviction voting dominance Assurance contracts and so I'm really excited about having a Swiss army knife of all the different Capital allocation mechanisms out there and starting to a B test them together but it also gets really cool when you start to combine them with each other I think you said that someone suggested we combine qf and

insurance contracts so maybe that'll be something that we run around with in the future yeah absolutely uh one of the you know so going back to the question about Dow governance and public goods funding being the same problem um and you know maybe they're they're sort of related problems but not the same problem after what you said and I'm wondering if if we feel like optimism retroactive public goods funding is actually you know a really intelligent marketing campaign for optimism but also a way of organizing their ecosystems public goods is is retroactive public goods funding and optimism a really smart way of funding optimisms public goods and therefore have they invented a new form a new widget for Dow governance in a way interesting I mean in some ways

yes right well I think it's interesting about optimism is that at least the way that I understand the vision it's uh that um you know gets starts off from optimism but then it ends up supporting a kind of optimism and then ethereum and then a kind of the internet and wider things as well as uh as the scale increases right so uh you know like as I mentioned like them I mean like funding I catch Yak was uh probably one good example of a kind of something more broad right because sketchek is uh you know the hash function that ethereum just Builds on but yeah it absolutely is incredibly useful for optimism itself right and so I think it's uh a model that could easily be copied by yeah other Layer Two zeroes or other kinds of

projects yeah I hope that had been that now we've got a bunch of layer choos that have multi-billion dollar treasuries what if they were all in a competition to fund their ecosystem in the world's public goods against each other as a way of gaining market share with each other would be a great way of sort of leveraging Bullock in order to solve a very mulicky problem absolutely that would be so amazing so we're getting towards the bottom half of the hour and uh maybe I'll start uh asking a few open-ended questions to see if we if we can't go down any interesting rabbit holes what do you think everyone is missing uh and what is everyone getting right with respect to public goods funding in the ethereum space so what is everyone missing what is everyone getting right and one thing I think that the ecosystem

is getting right is just the general drive toward moving into having of this wide diversity of uh different funding mechanisms and just uh having the wall run and together setting them up to be autonomous you know for the long term and at the same time right so you know that includes things like um and rpgf it also includes some of the ethereum foundations move Stitch writer um you know avoid growing the foundation itself but to write cell like focus on fostering organizations that can uh grow into just that being independent uh things almost kind of like mini foundations that are focused on someone

more specific goals just uh people's ongoing willingness to keep putting money into the bashing pools I think is really valuable and really good and so work by yeah I mean like hyper search and tea and like really trying to systematize the problem more and uh really yeah kind of push it up so that it can scale more I think is good um though it's something that we definitely need a lot more of I'm trying to think like what are things that we're seriously missing I can't actually come up with any yet well that's really positive answer to here it feels like maybe there's an

opportunity going back to your first answer to the question um in in that like setting up these matching pools so that they auto run um and setting up the ethereum foundation for a subtraction mindset it seems like we're sort of envisioning uh public goods funding future as more of a like a hyperstructure in that it can run trustlessly it can run without human intervention it can run without Kevin awaki behind get coin or you know any any one Central intermediary um is that something that excites you or were you taking that in a different direction yeah I mean I think student involvement is always going to be necessary but having it be something that feels like almost sounds set autonomous as possible and like as

something that people can just tend to rely on to exist kind of like how I'm you know like people and uh in country is just rely on the legal system to exist and kind of keep functioning same way I think is uh something that's really valuable lately the wheel system I think isn't interesting that I a kind of analogy right because that I mean there was a huge number of uh things that he gets are wrong just um you know like in terms of requiring people to like have expensive Specialists just to do basic functions but the thing that it does right is that it is remarkably decentralized compared to most other aspects of governments right and uh it is I mean like remarkably close to it yeah like it's closer to the ndl of a yeah you know

like self-support um sustaining autonomics on that's like just like run by a bunch of uh people who are you know like off-site doing their own separate thing then um than any of the other branches of government um and in the key like it would be really cool if public goods funding got uh at least that level and uh you know like potentially yeah taking advantage of modern Technologies then uh could have gone even further right like there definitely would be a dystopian aspect if I'm you know like everyone had to hire um a kind of you know like a funding optimization specialist so that will kind of help them um

what you do to get more money right but but if you just like to get to the point where it's uh a thing that just exists that just keeps running there's that and like lots of different parts of it it just like feels like a well-oiled machine that keeps going and it isn't dependent on you know like the whims of like one or a small group of individuals then like I think that would already be amazing yo I know that the Hope ever since you and you and I were geeking out on bitcoin grants and quadratic funding together was to have around every quarter and that um eventually people would get to a point where they can just expect that the rounds run like clockwork um and then people can do things like work on public goods instead of getting a job or doing an Ico

um and and you know of course now it's more than just get going there's optimism and giveth and clear fund and all these other great projects gadgets for rewarding public goods funding and so it'll be interesting to see us cross this threshold where we can create serious Behavior or change because the public goods funding is just so in embedded in the Bedrock of the culture in and of the community um it'll be interesting to see if and how that evolves in the future yep absolutely all right I got uh two final questions as we wrap vitalik the first is if we were maximally successful in funding public goods uh what does the world look like in 10 years so it's 2023 right now 20 33 in 10 years how has the world changed because ethereum has

gotten so good at funding its public goods hopefully we will see many more kinds of public goods out there and there would be much more of a expectation that if there is some piece of infrastructure that's uh really valuable to either ethereum or um you know to the Wilder wider internet or even aspects of the world outside the internet and you just go and start contributing and people start using it then like some level of minook reward starts kind of almost automatically trickling it and that the consequence of this will be that we're going to see just like less proprietary solutions to problems and more open solutions to problems more

generally right also start seeing a world where more things um boost within crypto and outside of crypto candidate like could just be open source from day one um because that opening things actually yeah would be good for right for your Revenue instead of being bad because uh the earlier you open the more you can be at the bottom of the uh close to the root of the contribution graph um instead of having to worry about like other people stealing your work you know hopefully yeah we can actually just see it yet a crypto space that a house so lesser Alliance on centralized actors and uh more Reliant so just like very well constructed pieces of open software whether it's set analog wallets or

client service or you know people providing data or whatever else I yeah definitely hope to see even my kind of potential companies and like maybe even governments to some extent experimenting with using systems that are similar to this and uh like basically yeah just uh creating an ecosystem where if someone identifies something that is valuable and just goes and does it then they can just expects to get several at least enough level of uh of a reward that they can keep doing the keep doing the work you keep focusing on the work instead of

having to kind of be a volunteer and have a part is yeah a sort of main job that that pays for their bills yes and and you know obviously it would be good uh you know laughter is being able to keep working on that on rodkey and for that to just uh kind of really uh succeeded for him to not have to you know worry about the amount each quarter would be amazing so the meme that's coming out I think optimism is impact equals profit so if I'm an agent in this system uh AI you know since we're talking about 2033 I'll just say ai ai or human then uh if I have some sort of impact some positive impact then I can make profit off of that and so I don't have to go out and get a job or um you know I can I can create impactful

projects instead of just profitable ones is that true reductionist or is that directionally kind of I think it's directionally there yes all right uh final question totally open-ended one is there anything I didn't ask that you want to say I mean one thing that I think would be is yeah valuable for us as an ecosystems to try to like work toward over the next few years as kind of really pushing hard on um making at least to these funding sources a kind of more automatic and like actually long-term guarantees instead of uh just being one-time grants like can we get to the point where like for example every Layer Two and not just stop to mess up has them you know like some share of their funds going to a

public goods funding Gadget and then those probably not public goods funny Gadget can just kind of automatically cover both you know everything specific to the roll-up and and things that are kind of broader to it Instagram as a whole or potentially going even wider like basically yeah as the sources of data become higher and higher Fidelity and we can get something that kind of approaches be incredibly neutral can we yeah get to the point of uh um sources of funding being able to really make long-term commitments and uh try to actually yeah I'm gonna put some more [ __ ] up there projects or other or other parts of their Capital to make a kind of

reliably go into those streams every quarter yeah basically like I think the big thing to think about is that like while these things are very experimental it makes sense to do them in this kind of like very yeah abstracted way at the top of the stack but then as they yeah I'm gonna look become more and more entrenched he wants to like actually start creating these longer serum expectations and guarantees and kind of move toward um like a World War protocols giving out uh tokens in a regular way in this way and I wonder like what are some good I mean like intermediate steps that can help keep pushing Us in that direction so moving towards more automatic and long-term guarantees probably trustless

guarantees that public goods will be funded we'll just yeah help make sure that the liquidity flows yeah exactly do you have a good sense of how much of that funding should go to my own ecosystems public goods versus like the dependencies or other parts of the world like you do you have a basic sense of like what a good guideline is I think what would be interesting is to like pre-commit to to for projects to frequette to a guideline that says yeah while the project is smaller and the focus would be more narrow but as the project becomes bigger the product Focus would widen automatically the reason why that's valuable is like first of all when a project becomes bigger it just makes sense for its focuses to start to become bigger uh but also it's a yeah a

kind of pre-built-in way of uh essential Asia ensuring alignment um you know like even if a yeah a project it's actually a start starts to grow to become very large and so yeah I think uh like actually coming up with like what that what that rule could be and kind of codifying and standardizing it I think uh could be really interesting yeah for sure will be a combination of uh technology and also social norms so listen appreciate you um imbuing your value you uh for public good in the space and in your work um and I appreciate you making the time to have this conversation for me I know that lots of people want your time and uh you know I appreciate you you giving

me an hour to talk about this stuff so italic thank you so much for for joining the podcast absolutely thank you too all right peace them up thank you [Music] alrighty we just heard from vitalik buterin I am very excited about this episode because I think vitalik has a lot of good thoughts about the future in the present of public goods funding in the ethereum space thanks again for listening to the greenpill.network podcast again we are featuring the people who are building a coordination a network Society of thousands of hackers dreamers and doers focused on using crypto to bring

positive some digital systems in the world I think vitalik with the creation of the public good that is ethereum but also uh in viewing his value for public goods into the community is a great example of this if you value our our work please remember to subscribe rate in review thank you so much for listening and I will see you next time peace and love