DAPPCON 2019: How to Measure Success on Ethereum w/ Vitalik Buterin

Transcript

a little bit of background last year at that con we had a panel about what could go wrong and basically tried to ask us the question if there's this bobtailing thing here is like technically successful what could nevertheless go wrong to to make it well to make it a net negative for society so we tried to discuss risks joe-joe was was on the panel as well and in part of this panel then well the question came up how to measure success or in other words what

is the metric about society that should change in a positive way if we are successful so why why are we doing this basically I start a little bit probably easier with right now most steps probably have less users then there are currently people in the room so are we successful and if so why are we successful okay and if what is the metric that we can currently observe that tells us that we are doing the right thing and that we are successful or are we not I'll jump in so the blockchain ecosystem

is 10 years old the smart contract ecosystem is arguably five years old it is incredibly young as a technology and still quite immature as a technology we we built what we're considering to be a base trust layer and offering it to the world more conceptually than for the world to really anchor all their applications into it yet and we're now building out defy open finance financial plumbing for the emerging decentralized economy and technologies take quite a while to develop themselves and to to be adopted

so between when Tim berners-lee wrote his white paper and when there was actual ramification in society it was at least 10 years mobile phones took a long time to catch on if you remember those old satellite phones and cars took a long time and electricity took a long time so this is happening remarkably quickly when a technology first emerges it's very raw you can see the innards of the machine you you're you have to turn the crank yourself you have to download extensions yourself you have to deal with the long strings of hexadecimal and we're just

getting to the point where we're figuring out user experience user interface usability we're getting to the point where we're figuring out scalability and privacy and confidentiality so right now I think we have to measure user adoption by how many developers there are in the space and and so I think we're doing incredibly well those are the people that are gonna fix all those problems they're gonna put the show on the machine and and make it really usable and I think early on we realized that it's probably gonna go well for a while but until we hit some extreme friction

in society we won't really know that we've arrived and so when the term coin is spoken in a congressional hearing I think we're starting to to hit the mainstream in in terms of awareness and so I expect it to go fairly smoothly but that that's one measure right there that we will get societal pushback this is it's two metrics I heard is a number of use of the term coin and developers rights in official public settings yes okay I think the limits of those kinds of metrics are that like we're one is awareness and the other is people trying

to do things and like it's queer that that there is awareness and it's clear that there are people trying to do things but the thing that I'm more and if concerned about is getting from that which I actually feel we have pretty comfortably to people successfully doing things like to what extent is this is the space like just people building products to help people gamble on future usage of the space which is people more people building products to help more people gamble on the future of the space versus like actually providing concrete value that they were that they would otherwise not have gotten and I I think

there are definitely kind of signs that valuable things are starting to genuinely happen in for like some of the events and more institutional applications or is actually starting to be used like etherium being used for just even things like verifying certificates like that's there that's happening and that's a value that you can it's not the biggest thing but its value that you can see fairly easily like when I say even just with for crypto currency itself when I visited Africa and I talked to some people in the local community and I ask like how concretely are people they're using blockchain things and the reply I got is

people or there's just a lot of people that are remotely working for companies based in rich countries and they're able to work for them in cryptocurrency just helps them move money to their families for a lot less than the in like 15 point whatever percent can knock you missions you would get with traditional services so there's things happening that aren't captured as being the revenue like as being clearly the revenue of a particular company dedicated to that thing and in some ways you should expect that because crypto is supposed to be about reducing intermediaries but I mean I definitely feel like we're not good at measuring the extent to which those kinds of things are happening now in our close to happening you're all

about measurements and metrics and data Masari I don't necessarily know that we're bad at measuring these things I think that you just might not like the metrics that that were ultimately looking at you know greed for lack of a better term is good in this industry at least and traditionally investments in Bitcoin have led people down the rabbit hole and gotten them more actively involved in the ecosystem and investments in aetherium have been speculative in nature by many people at first approached the industry and then that ultimately leads them further down the rabbit hole and if you think about the only in my eyes three applications of crypto that have hit product market fit its money originally with Bitcoin

which is kind of like a distributed central bank it's icos and distributed crowdfunding which is kind of like to distribute an investment bank and then more recently it's lending which is kind of like a decentralized commercial bank so I would look for things like wallet addresses that holds a hundred a thousand ten thousand dollars or more worth of these assets as probably the most important metric that the industry should track going forward because as that number increases more people will be fully hook line and sinker into crypto as an asset class as an emerging tech space because they have to put their money where their mouths are so the thing that grabbed my

attention about blockchain about Bitcoin originally was not securities law wasn't what whether or not the CFTC thinks Bitcoin or ether is a commodity or not it was about the notion that we could I'm a lawyer disputes lawyer someone who sued insurance companies for many years it was the notion that you could create contracts that couldn't be broken and I think that from my perspective I think it's too early to apply a sort of a financial metric and maybe my brain doesn't work that way I'm not I'm not in the same business as the other folks on the panel but for me when I start seeing people actually building

things that are beyond financial speculation that allow me as a lawyer to confidently automate the performance component of contracts I'll feel like we've are people familiar with the book crossing the chasm it's a classic book on entrepreneurship I feel like we are at I think there are five stages and crossing the chasm I feel like when you hear coin in Congress when you see people in Congress lobbying for or pushing for regular good regulation useful regulation I feel like I don't think Bitcoin or sort of crypto writ large I don't think it's gonna go away and my partners have looked at me funny sometime in the last couple of years but they're like you're still

talking about that Bitcoin thing right but I don't think it's gonna go I think it's too early to know what it's going to be in 20 years so going back to Joe's observation about technology this the elevator this is interesting but the elevator is something that was developed about 50 years before it was actually put into use and the problem is people kept dying because they didn't they didn't have brakes so it wasn't until someone patented somebody actually agreed to license these the steam brake for elevators that you had the development of high-rises I don't think you that anybody when they created the steam engine imagine elevators or high-rise buildings and I think what's interesting to me as a lawyer and

swimmers interested in technology is trying to imagine future applications so I can't I don't think I can define what it what is going to be success in 20 years I think I can I can predict with some degree of confidence that the technology itself the notion of decentralized money the notion of programmable money that is immutable ish i think that i think that persists just when on this note so on this note of full automatically executable contracts so one way i think about i tend to think about things is the internet brought down the cost of submitting information by a factor of probably way more than 100 so

and information as trivial as I like this photo like a facebook like is now kind of possible to what to share this information while before you wouldn't send letter just to let someone know that you like this photo with with blockchain kind of my my concept is that we can bring down the cost of transactions and that could for example mean well just giving someone a share in your end in your venture that could obviously be sending money kind of a broadest term of yeah yeah a transaction bring down this cost by a factor of one hundred thousand and and probably enable

yeah completely new things because this cost has gone so well you can imagine for example Jaron Lanier wrote a wonderful book called who owns the future where he describes both the utopian and a dystopian vision of human data either being able to monetize your personal data yourself or having that personal data being controlled by big companies in Facebook Twitter which I never use Instagram and so forth so the question is we can imagine a use of the technology that allows you to monetize personal data because the cost has gone down but we don't know I don't think anybody sitting this room is gonna know what it will look like in 20 years if it'll be a success but maybe to the others is the bringing down transaction

cost and explicit so when one actually Steven wanted to ask about one concrete example so this isn't a contract between two between two parties and the traditional sense but it it's a contract within an organization organizations are contracts right so if you're in foundation has the majority of its finest about six hundred thousand-plus ether in a any four of seven multisig between seven parties that are unfairly considered within the foundation to be trusted stakeholders and it also has a rule that says any one of those seven has the ability to withdraw a maximum of one that was in each birthday so you don't have to incur and give high inconvenience for small transactions but it protects us from

losing everything so what this account as an example of smart contracts being like you being used that you know trivial interesting things to you the so the multi-sig contract is a smart contract yeah but it's the keys are in control of people yes so you have I was just talking to somebody before like the the interesting part of that is that you still have to you said reasonably you said trusted people so there's still a human component to discerning who's trustworthy who can be trusted with those keys because multisig contract can be an absolute nightmare if you have the wrong people involved so I would say the that's it's really no

different in a way than having multiple physical keys to unlock a missile silo or to unlock a vault there's nothing about that in and of itself but but they're usually gonna be people who are the counterparties of these agreements that you're contemplating and I think what vitalik is saying is that the business logic of the agreement is is unassailable well you can do that with your bank execution of a smart contract when you say unassailable help me out what do you mean the business logic of that smart contract is codified you need work seven and no one can withdraw the

rules that that they've defined actually well agree so so like just trying to set up a legal structure probably across continents with seven like with seven people to say well we together want to manage this money and we want to give us those rules that probably cost you thousands of dollars to set up the appropriate legal structure for that with aetherium you can now deploy a multi-sig for 50 cents or something like that but you can't deploy the part of it that says each key holder is gonna keep is gonna keep their their key in a particular way or if so-and-so dies so-and-so will have access if you have four of seven like what happens if five

people are on a plane at the same time and they died how dull then it's only a thousand eight there per day for fun so like right two thousand eight there every each person can pull full money there is I would agree like the multi-sig is fascinating and is useful like the governance that surrounds that control is off chain and is has the same human complexity that lawyers and business people have been dealing with forever I don't I'm not sure the blockchain solves that it's also so I would agree that a major financial institution is probably equally solid in implementing that agreement right now but as etherium gets bigger and more decentralized and more

unstoppable ten months from now ten years from now I think it's gonna be much more solid than a financial institution populated by people let's not get too too deep into multi 6but transaction fees are was potentially still a way to measure success so maybe kind of going a little bit back from the from the big 10-year 20-year society question to like a short shorter term which blockchain is successful would you agree that the total amount of transaction fees like paid on a book chain is a good indication for its

success in economists would definitely say it's the most reliable and robust way to put a lower bound on how much people value people are getting from the chain it's I mean the thing it doesn't tell you is it doesn't separate between categories of usage but I mean it does definitely tell you that someone valued the transaction the transaction being on Shane enough to pay sixty four cents for it yeah and and I think it's probably the most important metric as some of these block chains inflation rates decline right so what does it cure security model look like for Bitcoin when's the inflation rate drops below 1% right you're going to need transaction fees if the miners under the current structure are going to be incentivize the way they are today aetherium

maybe somewhat similar even with the transition of proof of stake but for non money applications I would argue that transaction fees or some type of network income is probably the only fundamental driver of value otherwise most of these things are going to zero the one problem I have with us kind of socially agreeing to push that metric too hard is that it would incentivize like watching governance participants and I'm using this term broadly like including developers including miners voting on the gas limit like mining polls voting on Bitcoin block sizes whatever it would incentivize these participants to basically care more about extra extracting as much value out of

transaction fees as possible as opposed to of maximizing people's ability to use the chain and when you have when you have a monopoly which I'm watching kind of is then those two goals are very often easily in conflict if there was an important metric for deciding the value or popularity of blockchain say I think Tron's transaction fees would go through the roof ten minutes after that was decided oh yeah I forgot to even talk about the possibility of mining force being to themselves yeah yeah be 1559 is gonna fix that though so but-but-but-but

on that that is an interesting point on the basically potential of rent extraction I guess so yeah how do you how do you how do we prevent it so if aetherium is extremely successful and token securities whatever stuff is all on there how do you stop ether holders from at some point no longer trying to keep fees as low as possible but like just starting to extract rent I don't know if that's rent extraction just because especially is there's more alternative blockchains to build on competition is is going to bring that into kind of a natural

equilibrium right so it'll be part of the social contract of whichever the blockchain is that you're using that you know here's the equilibrium rate maybe it's you know one percent of total network transaction values been your remitted to the stickers and the miners validators whatever you call them but if it drops too low people are gonna lose interest the chain becomes less secure if it goes too high and it does look like rent-seeking behavior then some developers might migrate to another chain to build their applications so I don't know practically speaking in a world and you know five years where there's half a dozen or more competitive smart contract platforms that becomes a real issue aside from competition I think another thing that's important is

that this is a big part of why I favor a kind of diverse and multi-stakeholder governance structure so like if we just had Queen votes as a way of deciding but pretty much any system parameters then you know yes potentially like Eric Connor is gonna grow devil horns on his head and he is going to lead a campaign of all of the major eath holders voting to push the gas the gas limits down to extract fifty fifty dollar transaction fees like we saw in Bitcoin one and a half years ago and we'll have that forever but if you have a governance structure that and if more naturally incorporates voice voices from core developers major application developers stakeholders

users then that could be naturally mitigated more and also if a bad actor was able to capture the system in some way and and sequence on the system we've been saying for a really long time that the mechanism of forking would keep us all honest and if something untoward is going on on the platform then the platform can be for it can it I mean I think it has become or it will become incredibly more difficult than like two to two years ago more difficult than seeing the rates

Rison appropriately Forks are hard now because if etherium forks now then either on one of the two chains the price of die is going to drop to zero or it stays at 1 on both chains and then I have no idea what I think you would actually see I I think there's a non-trivial chance that there would be legal action I think somebody would probably go to federal court in New York or I think so and try and stop it there's already been I'm dead serious there's there are at least two lawsuits out there where and they're kind of silly requests but they're at least two cases where plaintiffs have asked courts to order Forks and I'm not sure that a court is going to do that in those cases

but if you start talking about forking what's the total value of eath of ether at the moment 20 billion you know if you go to federal court and say somebody's going to do something to an asset that's worth 20 billion dollars a federal judge is going to listen to that so I think that's sort of the that's sort of the external interesting to me as a lawyer that's the interesting baggage how would a judge look at aetherium in that context and I think actually so one is so who does the judge tell so forth that's a really good question so like what is it whose do you bring the exchanges in do you order the exchanges to do things it's a lot of different independent actors ultimately it's the

minors sure so I think that the exchanges would have to list tokens will have one of the measures of success I look at it as more legal certainty about those questions as opposed to speculating is legal certainty that comes out of a certain amount of pain I can't say from a volume transaction standpoint what what constitutes success I would think that when we can answer with reasonable certainty what that means what that will look like is it will judge throw it out who will be named what will the result be that will be a measure of maybe we've moved one step further across the chasm if you can't be sued you're sufficiently decentralized yeah I think this is forc discussion super interesting and I think

well maker is obviously one one reason why it's hard and basically I hope there will be many more so in s will hopefully be soon a big reason why it would be hard because the noon would need to decide well which which saying does the name resolve like security tokens once they are there and payout dividend and the question is do they pay out dividends tokens all those tokens so overall I can't my sense is that Forks will be very unlikely you know even for King is mutually assured destruction the wonderful governance mechanism that's kept the world so nice and peaceful for 75 years yeah so but if we if we do you do you think that's true even as

interoperability solutions mature right so the cosmos robber change block chains aren't just computation and data service providers there are also registries and it's that second thing that's a lot more than that brings the thorne eNOS how do you mean like a blockchain just is used as the root registry of like claims with within the context of particular applications and so if the thing splits in half then it either survives it either breaks on one side in which case other things on that side that depended on it also break or it survives on both sides in which in which case you get really weird economics happening so you

know like splitting definitely gets thorny or the more of interdependence you have sure so if it's ambiguous I would agree that it's gonna be a an impossible situation to work out but if there is a clear actor that has captured the system and all of the interacting participants on the system get together and say hey are you gonna switch are you gonna switch are you gonna switch then I could imagine a very clean transition these tokens represent a u.s. dollar in a bank account I'm running the company that makes that mapping we're choosing

this chain yeah I mean just from looking at history with Bitcoin and its major fork and aetherium in Athenaeum classic I find it hard to believe that you'll see another major controversial fork of one of those chains and instead at least I believe is more likely that specific applications are DAPs will end up migrating chains do you think we won't see a major Bitcoin fork in the next year or two people being people I would expect like it's been happening the one thing why would we see one because because no reason no reason people and money equal conflict it's true I mean that's a long history

of being a litigator tells me that so I it might not make sense and I will also tell you that you learn this if you spend time as a lawyer people do stupid things that are against their economic interest and that's a game theory tells you that as well behavioral economics tells you that as well so people don't always act in an economically rational fashion so my prediction is gonna is that if there's a lot of money at stake and you have people who are ideological you'll have Forks whether or not they make sense whether or not they're mutual assured destruction looking into my Oracle if you kind of short term shorter term like success metrics and I would just throw them in and see whether

that is there is a goal or would you say that that's to go to optimize for like put all effort into optimizing this value but whether it's a valid metric so one is just how many people have a wallet so in in in Bitcoin I sometimes hear is the argument work well it's obvious that not everyone on the planet could do a Bitcoin transaction so the argument is well that's not even needed they can have layer two solutions which are custodial exchanges basically in in in in in in that case so would you say it is an explicit goal to have as many as people as possible having a wallet or

have able to self custody sure but it's a little bit complicated if you're measuring or comparing different systems because the Bitcoin addresses are essentially throwaway addresses when they're used and there's a change address so just the comparison aetherium addresses are are much more persistent in there I think if thing if mixers elect tornado cache become more prevalent than we could see most moving toward like one address equals one user per application yeah I mean that was the key metric that I mentioned before how many people have a thousand dollars of crypto how many people have ten thousand and so on and and that's how you get a better sense for you know the the wealth

distribution as well as how many people are actually using this beyond just a novelty yes so if you're looking for identity as represented by addresses we could go up the stack a little bit and look at ENS or decentralized IDs and when those things get persistently registered and they become utilized significantly I think that would be an incredibly important metric maybe it's the whole question how do we how do we improve it or kind of what is needed that more people do it is it do they need more reasons to have it or and it should be easier both theorem in general

well crypto add crypto wallets I think just education in general right I think that the UX still sucks for most applications and most people don't really understand the messaging behind behind crypto right that's why Bitcoin has been so successful it's extremely simple to understand aetherium struggles with narrative it except for the narrative of if you want to build cool applications in your tinkerer in your developer then all are welcome right and I think that's why you have the the vibrant ecosystem of development and experimentation but from a user perspective right there is no narrative right so if you're taking the approach

that you can't trust your central bank you can't trust currencies you can't trust your your your bank where you're keeping your deposits then open up a Bitcoin wallet have a little bit just in case that's an extremely simple narrative and I think that most people won't go the next step to educate themselves if they don't at least have that very simple starting point people don't care about pipes right they want product so I would I would agree sort of a product focus you obviously need the pipes to have the product but if I can drop drop a little bit of a snippet of JavaScript into my web app so that I can do payments using stripe I don't necessarily care how that works but I know that I don't have to deal with

credit cards when you have I know that that's that sort of functionality was being developed but when you have that I don't I don't really care how it works necessarily I know that it's peer-to-peer which is cool it means I know that I can I know that Ryan and I can enter into a contract that can't be broken and I've seen that work in the past when you can start I think that narrative like a great story for me and it's maybe if you've got a shovel if you have a hammer you see nails insurance policies that can't be broken I mean if you've ever had a claim with an insurance company you know that they're much happier to take your premium than to pay claims that sort of product like check this out like a life insurance policy when you die it will be

paid and it's because of this blockchain stuff I think that's sort of that to me is it remains much more interesting than sort of pure currency payments that programmability when you can do that without having to understand solidity in it perhaps I think the main challenge was this stuff is that basically any contracts that people make other than paying bounties for assault for solving math puzzles like just has to have a real-world component that block chains by themselves can't read so I mean I think there are going to be applications that are less than a hundred percent trust less and you'd expect them to those to be the majority but this still needs to

and appreciate understand when we're getting real gains that don't go quite that far and appreciate them sure then maybe I would again repeat the question from last year and asking if we are selected neurologically successful what could go wrong in any way so so what are risks basically of this technology or all of the use cases that could actually reach more people more people than cypherpunks get captured by semi decentralized or pretends decentralize decentralized centralized systems once again all the

use cases that aren't crazy cipher plug stuff in that a cans that that seven billion people could legitimately be attracted to just get captured by things that are more centralized than we would like so basically the status quo I mean I can elute astrological signs but the astrological sign that you're referring to you don't want to say are you still thinking we're okay you're processing powers run a little faster so figured I could speak and maybe I'll piggyback off

of what what I think Joe is sensing out I think one of those terrifying things for any rational person that's in the ecosystem certainly for regulators and and kind of existential type of threat to to the financial system if everything goes as planned and this really takes off is will you have a private money supply right so whether it's ZK snarks or Starks or any you know privacy enhancing technology that ultimately cloaks transactions and and just who owns what and how money is moving if that happens at massive scale on the market cap increases by orders of magnitude now you have a sizeable chunk if not the entire global economy running

on shadow Finance that that's completely untraceable and I think which is different from the way it works today the difference the difference is that we haven't figured out governance of these systems so if you are fine with crypto ultimately being governed by the etherium foundation and the major stakeholders and the major miners then that's one thing but I think that as this technology grows more pervasive as the impact on global finance becomes much more real you're going to need

actual governance and you're going to have government's talking about this and there's going to be treaties so when were involved in the and wouldn't honor our running the world the young upstarts were were people who wanted democracy and so it takes time to figure out those systems to mature those systems to harden those systems so that they work and I think we're in the next phase of say a governance phase shift that transition happened before structured finance which is so itself a big accident complicated and sophisticated and interesting so like a really simplistic way of saying what

could go wrong I would say things that don't have an off switch complicated things that move value quickly that we don't understand that don't have an off switch and that don't have governance that we understand that's actually that could be a problem and if you're talking about like let's think about this twenty years down the road building stuff that you so the internet doesn't have an off switch really accepts that in some countries it may have an off switch in the internet you know globally it doesn't really have an off switch does the internet have failure modes is Facebook a failure mode is is the exploitation of personal information a failure mode if it is that's just an

application on this infrastructure that that you know regulators and society is having a discussion about right now Facebook can be turned off Twitter can be turned off banks can reverse transactions I'm not I'm not making a normative judgment either I see the benefits of a semi autonomous or semi-autonomous financial structures I get that but you can still turn systems off you can still reverse transactions we still do understand how the financial pipes work if we're talking about speculating sort of a thought experiment what could go wrong twenty twenty years down the road we could have systems that we don't understand that our I'm not saying it would be easy to turn facebook

off but we could do it I'm not sure I like the idea of a world where we have systems that we can turn off week week I mean nobody graz the internet completely and nobody can turn off the internet this is especially relevant to this panel since we're probably all in the top 50 for the assasination markets right so well at least yeah speak for myself I'm just a simple country lawyer said I'm not interested you brought up kind of the one direction that that is the the privacy to some extent there might also be the risk for the opposite direction like kind of no privacy

whatsoever and everything transparent everything on the blockchain all your financial transactions visible by Libra maybe I don't know is is that a risk or do you think privacy technology is strong enough that this will definitely win I mean I personally have a little bit more comfort over the middle ground right so using things like can we jump learn like what's that can we achieve the mythic ground I mean I guess everyone agrees that well on the one hand if everything is anonymous by default the entire system is anonymous by default that seems like it's gonna be too scary to get mass adoption and in fact you're starting to see some

countries that are just out outlawing things like Zee cash just preemptively I think the other thing you have to keep in mind especially during this transition period is is how will you possibly work as an on and off ramp to legacy financial system and kind of the real world if you will if you don't have some ability to follow financial regulations and you chance you know point to at least who's acquiring these assets even if they then take it and put it into their own hardware wallet and transact it elsewhere and move it through tumblers so that to me I get a little bit more confidence that if you can regulate the edges and the system kind of in macro is

is somewhat transparent that's probably a good thing but in micro it becomes much much more difficult to trace any individuals transaction I think that's kind of the holy grail in the middle ground that that ideally would like to say there is historical precedent for middle grounds were working between basically regulation and crippling archaic technology is working reasonably well I'd points to a copyright enforcement as being number one and I'd even claim I definitely strongly claim the middle ground is superior to copyright people being able to do whatever they want sand there's arguments to be made at superior that's a no copyright existing at all as well such things you have to have happened so I think there's gonna forever be a

tension between transactions that are associated with an identity and transactions that you effectively can't associate with an identity or are pseudonymous I think we're gonna see it with respect to cryptography and regulation and other forces in our technology but I think it it will go beyond our technology if we end up building perfect systems for hiding identity somebody's gonna build a technology maybe it's nano drones that that fly around and and see the the keystrokes that we type in into our

keyboards and record those things and report them back and so there will always be people who want to do stuff in an undisclosed fashion and there will always be people who want to see what they're doing then sleep tight coming back to the original question and asking again about the positive case so trying to point down to a metric about society so what is the metric for society that you would like to see improved by blockchain in in 10 to 20 years and if you don't want to point

down to a metric then maybe just just what's your biggest hope maybe for for the technology human happiness human happiness and well then I guess how would given happiness right I think it depends on the people who are building with it I think the mistake is to assume that it's a look you can build a building with a hammer you can also knock somebody over the head the question is gonna be the intentions of the people who are using it in the products they're trying to build we don't know if it'll ultimately be add a net but a benefit or a net detriment I think we can reasonably expect that it's here though so that's up to people in this room in problem is it's hard to

quantify happiness objectively so I will go for much broader economic and political agency for people around the world and I think we can get there because we're we built this technology that enables us to build collective collaborative systems I've been calling them topical global villages where you get a group of people together you build a blockchain based system you define some goals you define membership rules you raise money you execute the work on the blockchain and it can be in pursuit of cure of a disease or some other shared set of goals I think we're going to be living working playing on these

systems and I think we're gonna each of us will have stake in those systems we'll probably own those systems through token ownership and staking and we'll probably need that ownership in order to participate in different roles and so we'll be voting and working on these systems yes so in this direction so that wasn't kind of my metric I choose last year was the the number of things you are like let's say interacting on it on a daily basis so the the the coffee shop you're going to and kind of increasing yeah the number of things you're interacting with where you also have a stake in so you have some form of ownership that would

be for me what kind of one of those metrics italic I like the phrase economic and political empowerment and well I think you might have you said agency but empowerment is good too I mean yeah in general the I I feel like the ultimate goal here is to allow if people and communities of people to be able to reform institutions applications what structures or whatever of different kinds whatever you call them to help them shape them and shape and improve their destinies and that's say yeah I mean a very broad and hard to measure but also a very powerful thing another way basically it's a different actually it's it's more specific than happiness

because happiness can potentially be provided by a big brother God that doesn't give you any choice and how you get it so an another way to think about it and measure it potentially is to think about how much of an ownership or stakeholder ship society we develop and so if I have economic and political agency in these systems that I live within then I'm effectively an owner of those systems and and it's it's really great that we're calling this next phase of evolution of blockchain systems staking systems and that we're we're staking assets and in our time and

attention as we move into a much broader ownership society we'll have many more people with skin and in the game many more people grounded in in things they care about so many people will be working to protect and preserve and to to grow those things rather than break those things down I'd like to see everybody between one thousand and ten thousand dollars worth of Bitcoin and ether going back to my metric that I think will lead to success six billion x one to ten thousand between seven point six trillion and 76 trillion market cap on the low end

oh and that's gold on the high end that's a replacement for sovereign currencies depends how many times Bitcoin forks though I said I said good coin and ether Joe I said Bitcoin anything alright thanks thanks a lot sue I think we will open it for a short Q&A so we will we can have a couple of questions and I see how we need a mic I see when right here all right guys I want to ask your opinion about the new

Dow movements and specifically the for-profit house do you think there's any like realistic chance that it could work no not my locked up with the new ones I so I haven't researched the specific and specific structures called for profit Ellis but and I mean honestly I Eve I've been liking the word Dow less and less because it has like it has a very specific connotation about this kind of singleton thing that everyone works through as opposed to kind of more broadly just thinking about like how can we use smart contracts so like one definitely ways in which smart contracts

can be used to improve like different profitable business activity and I I suggested Dai Co is about a year about a year and a half ago as one possibility more recently there is this post on either research about something called public interest projects where basically people stake money and then the interest from putting that money in compound automatically gets put to whatever projects you support and you can take the money out at any time so you're kind of never risking your principle which is I knew daac or squared in some sense and I find that interesting so I mean I definitely support kind of broad innovation in these kinds of structures I think some of them could be really useful so I would say that the concept of the DAO is interesting as a protocol

governance mechanism not as a replacement for it an entity itself so now projects that are not trying to swallow the ocean and the consequence drowning and becoming the ocean but pick specific elements of corporate governance that don't work and iterate on those I think like the notion of sort of automating governance issues that's another for me example of how do you use more contract technology to automate performance those are the projects that are interesting not the ones that try to recreate everything yeah we're gonna have so many protocol based open platforms or these topical global villages that I described earlier and we're gonna need governance early on

some of us were using the term decentralized organizations as distinguished from decentralized autonomous organizations a decentralized organization has people in governance of it a decentralized autonomous organization you snip the cords and the people aren't really in control and it's operating by some-some logic that you can't adjust anymore we make we'll probably see some of those things at some point in the future so I've never been a fan of the term Dow but we're seeing interesting ones pop up now for charitable allocations and I think we'll see lots of for-profit versions of them

somewhere out there there might be a person named Aaron right who runs a project called open law the open law team has just put together a framework for legal Dow's they call them Laos legal autonomous organizations and for your protocol based open platform you can now talk to Aaron and have a fully legal blockchain based decentralized organization to to govern yours system based in Delaware currently but they're trying to figure out other jurisdictions also quick so the question regarding the mixers and other protocols

that are being built so if we go ahead and launch the mixers on the main net what are the as a company or as an individual what are the what are the challenges you will have to face from the government or anywhere else technically it's doable but I'm worried about the other pieces so any advice to that wait so the question was like challenge like a governance or challenges from the government government government yeah so I mean this gets into this kind of area of law where on the one hand there's this kind of long-standing precedent to that and

of code is free speech and if you write code in you pot and publish it then there's and there's free speech protections around it but on the other hands like the extent to which you can lean on that is not infinite there's a difference between writing stuff on paper on your computer and and instantiating it or making it actually perform and do stuff I'm not going to provide a legal opinion about the legality of mixers but like creating a thing is different than running a thing and if you operate a mixer and you're involved in somehow and money transmission I mean I'll be talk to a lawyer you know which is different from using a thing yeah so I could set up a

mixer based on code that you wrote and if nobody ever used it I probably wouldn't be party to any sort of illegal activity but if I facilitated illegal activity so it's really about what the actions are in specific jurisdictions my understanding is that things that give you more risk one is actually running actively running a server another is making money from it yes I mean obviously if you're profiting something that looks dodgy in the eyes of the law it's maybe there's more risk than not profiting it really I mean it's such an it depends it's it's hard to answer that question with any and it'll

give you any sort and if I run a mixer that is designed to anonymize ownership of game tokens potentially so if there's if there's a real good usage for it that's not illegal and somebody happens to like clean their value tokens somehow I might not be liable potentially so I think why a lot of a lot of people like us find a space interesting is because we're very frustrated with the legacy financial system and we think that it extracts a lot of value from the real economy for the actual benefit that brings like moving assets from A to B or acting as a registry so I see auctions

like a theorem like a place where you can really design new systems to minimize this this extraction of value from the economy but do you think that talking about business models do you think we as developers are kind of like altruistically making the world a better place or do you think there's actually a place there to actually also for companies to make profit out of this minimization of the abstraction of value so the reason financial institutions are able to make money inordinate amounts of money perhaps is because they are centralized intermediaries and they've

imposed themselves into a situation and they they maximize the value that they take in any transaction and the value of providing those services in a much more decentralized context is so that you can provide intermediation but in a much more competitive landscape so that there you can't really engage in rent-seeking behaviors decentralized markets are or these protocols will be a really good way of did or doing price discovery around the value of intermediation because intermediation is often very valuable

whether it's done by a smart contract or a banker it's just a question of paying the correct price for it in terms of whether developers are doing it for altruistic reasons or profit seeking reasons or both I think you'll get a pretty broad spectrum it's very case-specific because and like this is like the problem is right that like even going more broadly that as we

enter the information age this kind of traditional economic model of like I build a thing that's useful to you if you have it and you buy it because he wants to have it doesn't really work so well because a large portion of the things that are getting built are fundamentally partially or fully public goods and so you're creating things where if you try to get keep it then you're basically destroying a whole by a large portion of the value and so like because the economic system itself doesn't create this every day this nice direct link where you give someone a thing and they give you they give you money because it because they want thing you have to rely on business models that rely on something connected to the thing

the thing that you're building and sometimes these because that like this creates mismatches so like advertising revenue being the example that people talk about the most but also it does mean that the and there's not going to be a universal answer that covers every sector and sometimes creating a coin is actually the right thing sometimes creating a company that does some things but also sells some things is the right is the right thing it sometimes like just being a enough charity and accepting grants from other people is pretty much the only I mean if pure way to do it it really depends on the case okay thank you um one last question

yeah was it me yeah okay the economy the economy economically inequality is increasing a lot currently in the world and you said before that you hope that blockchain would help improve economically agency and empowerment but you believe that blockchain will help Inc reduce economically inequality or increase it even further that today maybe to put even more anticipation right now the inequality inversion is probably larger than in the society yes blockchain is not going to solve

world hunger it's not gonna solve inequality it's a it's a tool I mean it depends on how people use it I don't see anything about the technology that makes it more or less likely that the world will be a more just fair place that will allow people to have more equal distribution of wealth that's reducing barriers between countries is probably the bull is one of the bigger things but also sometimes reduce barriers makes people hate each other more I mean it's it depends on what you build not I don't thing and being cynical I just I don't think it's a panacea so I I definitely believe that having a better trust foundation having reduced barriers having greater collaboration platforms

will lead as I indicated earlier to greater agency economic and political for most people and and so I do believe that while pretty much all systems including blockchain systems start out with the value extremely concentrated amongst the one person there the two people that starts a company or something like that we are achieving greater decentralization in our ecosystem and as this stuff actually starts to get used I think the value is going to spread out probably better than in the previous technological revolution where the

technologies that were brought forth enabled the people in control of those organizations to stack value higher than it's ever been stacked before I think this time will be different to use a phrase and I think blockchain is a unique mechanism that will enable this yeah I think in a healthy capitalist system it's not a bad thing if inequality goes up provided that the bottom quartile of people have a higher standard of living than they did before whatever the disruptive technology was that that entered so this has been you know pretty consistent with every major

nology shift and and and during the transition it can get a little messy and it can get chaotic and and doesn't always look that good for the the people that are disrupted especially if they can't change jobs quickly enough but the end result over time is that standards of living writ large end up increasing I'll give a book recommendation the rational optimist by Matt Ridley if anyone hasn't read it I'd encourage you to because there's a lot of doom and gloom and we tend to focus on like you know what are all the things that could go wrong but generally speaking living standards globally for centuries now has continued to get better and better and technology has been a driver of that and capitalism has been a driver of that I

think I just just have to add here that well I'm still naive and optimistic about it so I think stuff like universal basic income inequality basically this technology could reduce inequality yes so I feel like by today's metrics I think things are going to get better in terms of how wealth is distributed in the world but I also think with different technologies we're going to get to the point where we do have all of our physical needs met or our survival needs and we start to change what we value in society if we start to configure our institutions whether

they're corporations or other to maximize mental and physical health or societal health rather than GDP where I'm not talking next year but maybe twenty years from now they're you know we're in the US and and I was just in South Korea a huge focus on on social value as generated by corporations and there's a big company in South Korea that has 50% of the bonuses paid to executives based on how much they're driving social value so I think the the discussion or the metrics have a chance of changing over time okay we are

already getting lots of messages to you that we are way over time thanks a lot thanks all to you and thanks a lot for the questions [Applause]