Why NEAR Believes Privacy Is the Next Unlock with Lane Rettig

Transcript

We're not against grants. We're not against sponsoring events and things like that. The veneer's done a lot of those things in the past, but they haven't always produced the ROI that, you know, we wanted them to. And so, we just feel that like the right thing to do is really double down on product. We hired a bunch of amazing product people from Silicon Valley lately. You know, we're focused on a lot of the near AI kind of product related work. So, I personally would like to see a lot of those funds flow into product. >> How do you determine what the right place to send those fees are? What is the current governance structure on year? And then what could that process if it were to go to shareholders? What would that process look like? Why does privacy matter? >> Man, that's such a great question.

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>> I just teleported. >> Finally. >> Most exciting lead up to an interview ever. >> How's how's the city treating you? >> Uh I love VA. I've been here before. You know, my first time here was in 2018, very early in my crypto journey. I started in Ethereum in 2017. Uh you guys probably know as an Ethereum core developer back then and I've always found Buenosire and like Argentines to just be like the smartest people in the world when it comes to crypto. Like they just woke up to it. They got it early on and they've been like holding our hands and teaching the rest of us since then. Um the the my Bitcoin prophet, the guy who like held my hand and walked me on my personal journey down the crypto rabbit hole. Gentleman named Santi Siri.

He's Argentine. I was able to catch up with him here. So I feel like I'm back in like the motherland. [laughter] >> Yes. >> Where it all started. >> 100% 100% cool, >> dude. Privacy is very is hot. >> Near intense are very hot. Zash is hot. Zashi the Zash wallet. >> You guys had a chance to try it. Man, it's incredible. Um you guys have just or they just announced the ability to actually shield within the wallet now >> like 24 hours ago just work few days ago just happened. Yeah, >> literally. And so that's powered by Near Intense. >> Um >> man, this journey of kind of like revival of this entire privacy category.

I know you guys are coming at this from the agentic side. >> Correct. What has this been like from the from the protocol perspective to see this growth? I mean, it's been like I think there's over almost $10 million in intense fees generated over the last like call month or two. It's really it's really growing. How how are you feeling about this all from a protocol perspective? >> Yeah, that's a great question. Um I think from a I mean first and foremost from a personal perspective it's been really exciting. It's like look, it's been I've been doing this for like going on 9 years right now and it's been a roller coaster ride and we've all had like moments in our career, especially when you've been doing this as long as I have when you're kind of like you're hitting pause and you're like, what are

we here for? Is any of this working? You know, product market fit, you know, like, you know, meme coins and all this kind of stuff. Where's the like really important applications? The ones that going to like improve lives for everyday people, people places like like Latin America, like like like Argentina. Um, and so I think that this like privacy explosion that's happened recently, it's just like a very long time coming. I mean, dude, so much love, so much respect to the Zcash team. They have been crushing it. They've been grinding longer than I have, longer than Near has, you know, they're like as as old as Ethereum, right? They're coming up in 10 years. Um, really well deserved and just like it's from a personal perspective, it's just given me a massive like influx of energy and passion for what we're doing. As an infrastructure builder, it

can be hard too, right? We're grinding and building infrastructure that uh is kind of invisible a lot of the time. So, man, this this this near intense story, this came out of nowhere. >> I I'd love to say that we like orchestrated this. I mean there's always collaboration. There's always conversations going on. There's always, you know, some degree of kind of bisdev happening. So not that like near didn't have any hand in this, but it's organic. It really is like this is just a thing. It's just like a a technology that was just in the right place at the right time. It found product market fit or product market fit found us. Uh and to be able to support projects like Zcash and and privacy and stuff. Um I I just couldn't be more excited. From protocol perspective, that's a bit harder to say.

Like to be honest, we're still figuring it out what this means for Near as a protocol. I'm very focused on governance of near and like one of the things we need to figure out how to govern is like the fee switch on near intense if we decide to turn that on at some point right um but it doesn't change anything in the core near protocol I think near has been building towards this since the beginning really so am I mistaken about the fees then >> I think the fees are going the fees are going the fees are going to the solvers like there's no protocol fee switch yet >> what's your reaction to some of the other fee switches that are currently floating around in governance forums are being turned on meta >> yeah I I'm super boring when it comes to this stuff Like I know I know the whole

you know the joke that we've been making for years about how like you don't want to have any revenue, right? Because then like your valuation is more like you made up number and it's harder to raise money once you turn a P switch on. But like I want to I again I think it's just my my my crypto grandpa status. I've been doing this for so long. I want to see protocols and projects that are sustainable, you know, that's more than just magic internet money. Uh and like I was so excited when Hyperledger uh sorry when Hyperlid like pulled this off and like showed what was possible, right? So I think we're like following in their footsteps. So 100% I want to see sustainable economics. So if he switches, I'm all for it. >> Havachi is fast and private [music] per trading secured by ZK with Celestia

underneath. Go to habachi.xyz to start trading today. Want simple? Want fast? Want every chain? Use relay.link, the fastest bridge in crypto. [music] Transfer your assets crosschain instantly with very low slippage right now on relay.link. Holiday is unified crypto payments. Give your users more wherever they are. Go to holiday.xy XYZ to never write a smart contract again. >> And the that's probably the front half of uh complete uh community value acral mechanism. The front half is turning on the fee switch. The back half is what you do with the fees, right? You product market fit has found you guys, right?

And so uh there's thankfully there is fees that are coming in, you know, if it were to go turned on because uh the product is being used by the market. Um, but the back half, how do you determine what the right place to send those fees are? What is the current governance structure on year and then what could that process if it were to go to shareholders? What would that process look like? >> Yeah, excellent excellent question. This is exactly what I've been focused on. So, it's it's interesting that to to note that years later protocols like Unis swap are still struggling with this question, right? I mean, they they're airdrop was 2020 if I remember correctly, right? 5 years later, they're still figuring this out with the governance token and everything. It just shows how hard governance is and how we're still like learning every day. Uh

and yeah, the reason we haven't turned on a few switch or even really had a really serious conversation about that yet is because if we do make that decision, we have to make sure number one that it uh is a community-driven decision, right? Led by decentralized governance for a whole bunch of reasons. It's just the right thing to do. And number two, that we know what to do with the funding, right? Um so we started a year ago to create a new governance initiative for near foundation near protocol called uh house of steak. That's the name of the project. And the stake is is a hold over from a previous governance initiative, but it just refers to the fact that it's stake. So very common to what other folks are doing. Um and the idea like house of stake right now um is doing some pretty

big economic changes. We launched a month ago. We've already we actually just few days ago passed our first two proposals which is really exciting. They uh are economics things that involve kind of like incentives and rewards and things for validators and for people who are participating in governance. You guys are probably aware near like a week ago 10 days ago or something we just cut our issuance in half, right? which is a really exciting thing. So I think there's like a recognition on the part of not just Mir but a lot of proof ofstake projects that look the honest thing because I was I wasn't in the room at but I was in the room in Ethereum when we were designing you know the the rollup sorry the the merge right like the Ethereum proof of stake system back in the day and I can tell you that like

it kind of looked like this. This is like core developers sticking their finger in the air saying okay 10 it's like a find a goldilock spot 10% is insurance feels too high you know 1 2% too low let's take 5% 7% 8% whatever it is but here we are 5 years later and we're like all right like we have real economists in the room now we like know that uh we can do better so that's kind of what motivated the near you know switch is talking about it avax is talking about it they all are um I haven't answered your question like as for what we do with those with those fees I mean they should be invested in the ecosystem >> right what that means is a question that's going to you know get a different answer in each ecosystem on them. In the

case of Near, um we are very focused on product. >> Yeah, we've had this massive kind of pivot, this I think this wake up moment a few months ago where we realized that >> we're not against grants. We're not against sponsoring events and things like that. Lir's done a lot of those things in the past, but they haven't always produced the ROI that, you know, we wanted them to. And so we just feel that like the right thing to do is really double down on product. We hired a bunch of amazing product people from Silicon Valley lately. You know, we're focused on a lot of the near AI kind of product related work. So I personally would like to see a lot of those funds flow into product. And so to double click on that, right, you invest in a product. This is the AI super cycle

show. And so naturally, you guys are building AI and you're here on the show. And so what what would in >> flowing the the value from the fee switch into an AI product? What what could that look like? Is it paying people paying to train models? Is it incentivizing certain usage of the models? Generally, what what do you think could be an incentive mechanism that that would help to bolster the the AI product? >> I think it's all the above. I think it's everything you said and more. Um, and again, just full transparency, we're still figuring this out. I don't think we have like really solid answers here. I know you guys have spoken to Ilia, um, you know, as well, and he shared a bit about his vision for this thing called DCML, right? Decentralized confidential machine learning. It's a bit of a mouthful, but it's just kind of like a a

catch-all term for like all of the AI decentralized AI infrastructure that near is investing in and building. Um, and very much a big part of that vision is we need things like um, so it's confidentiality verifiability privacy right? at at the center of it, but it's also verifiability in things like model training, right? So, we want to be able to run model. I talk to spoke about like sleeper agents and things like that. We want to like know how the sausage is made and have like verifiable proofs of that. But one of the nice things you get when you have verifiability in both inference as well as in model training is you can actually have like content creators, people like you guys or anyone putting out content out there um actually be given a proof that the thing that they poured their energy and their,

you know, their financial capital, their sweat equity, etc. into into building into putting out in the world like is included in this model verifiably provably right and then further you can say and also inference is performative on it right and so to the extent that you have applications that are built on AI that are revenue positive right you have this chain of uh of of custody so to speak right where you can trace back and say that actually there was this set of content creators this content that went into it right that was monetized profits were earned and so a piece of that should flow back to the original content creators right I think that that's a place I would like to see those revenues flow in the beginning and just come up with a more sustainable model because the like AI has broken the

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Yeet is built for big moments, the most fun you'll ever have with your crypto. Go to yeet.com to yeet into your next game. >> Kind of switching gears into the privacy uh kind of realm from the from the roots that you came into the space and why does privacy matter to you? Man, that's such a great question. Um, why does privacy matter to me? And look, I think what we need to understand and and it's look, we're 10 years into this journey now in the case of actually almost 10 and a half years in the case of Ethereum. Uh, >> how many years, you know, how many years has Bitcoin been around? Uh, 15 years, something like 15 16 years. Yeah. Uh, so it's we're beginning to forget the message is getting a little bit diluted, but actually like Bitcoin, I'll start with Bitcoin because it was the first

mover, right? it emerged in a particular place in a particular time. It was a particular kind of socioeconomic situation. Uh obviously there was a response to like the global financial crisis, right? Um but it was also came out of the cyber punk movement and it's I was actually just cuz I was at cyberpunk congress here a couple days ago. I don't know if you guys had a chance to check that out. That event was was epic. Um really just this massive revitalization of of energy into kind of the just reminding people why we started what cyber punk values are. Um, right. Cyberpunks were were a movement in, you know, kind of the '90s, you know, into the 2000s. Um, a group of people who were deeply mistrustful and suspicious of governance and governments who deeply believed in privacy and the right for for everyone to kind of communicate

privacy, have like financial transactional privacy, that kind of thing. Um, and personal responsibility, right? And those are values that, you know, really like again, that's just a cultural millu in which Bitcoin was born. Um, I think it's just important to remember where we come from and and Ethereum inherited those values from um from Bitcoin, but again, you know, over time they've kind of become a little bit a little bit distilled, a little bit kind of watered down, right? Uh, we're kind of on the third or fourth generation of projects now. It's just important to have events like the Cyber Punk Congress to remind us of that. And I'll just throw out there personal reason as well. Um, you know, my father's a Holocaust survivor and, uh, I think a big part of my life story is kind of, um, you know, how do we build

better human systems, better human institutions to kind of prevent, you know, government overreach, things like that from happening again. Uh, so I think I share the cyber punk's kind of mistrust of like strong centralized systems and centralized governments. I realized this, took a while to realize this, but it's a big part of my motivation for why privacy matters so much to me. >> Wait, man. We let you go, man. We'll do it again so far. >> For sure. >> Thank you, man. >> So good. So good. Thanks for having me here. >> Sure, man. Thanks for coming on. Of course. Anytime.