At the first Unchained Live, Vitalik explained why he thought it was “inevitable” Ethereum would lose some of its lead, when he would be upset if Ethereum were overtaken by a competitor, and whether the Ethereum 2.0 road map was too long. We also discussed why a strain of Ethereum maximalism is emerging, how the foundation sets its funding priorities, whether or not the community should adopt inflation funding for development of the blockchain and why he thinks the MolochDAO experiment likely won’t garner much investment. For the full summary, go to http://www.forbes.com/sites/laurashin/2019/03/26/vitalik-buterin-on-why-ethereum-has-lost-some-of-its-lead/.
Thank you to our sponsors!
Quantstamp, the venue sponsor for Unchained Live: http://quantstamp.com/unchained 🔐 Visit quantstamp.com/unchained for 5% off your next security audit (offer ends Jun/30/19)
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Episode links:
Previous Unchained interview with Vitalik Buterin: https://unchainedpodcast.com/vitalik-buterin-creator-of-ethereum-on-the-big-guy-vs-the-little-guy/
Unchained episode about MolochDAO: https://unchainedpodcast.com/molochdao-could-this-decentralized-autonomous-organization-help-ethereum-scale-faster/
Zcash interview: https://unchainedpodcast.com/zcashs-zooko-wilcox-on-why-he-believes-privacy-coins-will-be-used-more-for-good-than-bad/
Unchained interview with Glen Weyl and Santiago Siri referencing radical markets: https://unchainedpodcast.com/how-blockchains-can-help-create-little-democracies-everywhere/
0x interview: https://unchainedpodcast.com/will-warren-of-0x-on-why-decentralized-exchanges-are-the-future/
Augur interview: https://unchainedpodcast.com/joey-krug-on-how-augur-is-like-any-other-tool-ep-79/
Dharma interview: https://unchainedpodcast.com/nadav-hollander-on-how-dharma-could-create-new-forms-of-debt-ep-80/
Compound interview: https://unchainedpodcast.com/how-youll-earn-interest-on-your-crypto-with-compound-ep-82/
dYdX interview: https://unchainedpodcast.com/how-dydx-allows-you-to-take-a-short-position-in-one-token-ep-86/
Unchained episode on MakerDAO, part 1: https://unchainedpodcast.com/rune-christensen-of-makerdao-part-1-how-to-keep-a-crypto-collateralized-stablecoin-afloat/
Unconfirmed episode about superfluid collateral and echoes of the 2008 financial crisis: https://unchainedpodcast.com/how-to-earn-money-on-collateral-in-defi-and-why-thats-risky/
Unconfirmed episode about Uniswap: https://unchainedpodcast.com/how-uniswap-quickly-became-one-of-the-most-popular-dexes/
Dfinity interview: https://unchainedpodcast.com/dfinitys-dominic-williams-on-how-its-blockchain-nervous-system-is-not-an-ai-ep-78/
100th episode of Unchained featuring a poem about crypto and the podcast: https://unchainedpodcast.com/100th-episode-past-guests-and-listeners-take-over-the-show-ep-100/
Transcript:
Female Speaker:
Ladies and gentlemen, welcome to the first Unchained Live, sponsored by Quantstamp. Thank you for joining us, and now please welcome to the stage, host of Unchained, Laura Shin.
Laura Shin:
Hi, everyone. I’m so excited to have you all here at the first Unchained Live. Your no-hype resource for all things crypto is on stage at Pulitzer Hall, Columbia Graduate School of Journalism. For those who don’t know, Unchained is my weekly hour-long podcast that covers all things crypto, and in a few months, it will be three years old. When I started this podcast, I never, ever imagined that it would become something big enough where I could hold an event like this.
So I really, really appreciate you all for listening to the show and for coming tonight. It’s also really meaningful to me to be doing this event here at Columbia Journalism School because I came here for grad school 11 years ago, and at that time, kind of like my podcast, I never imagined I would some day be doing an event in this very building.
And hilariously, until tonight, my main memory of this particular floor in the building is that, on the night of graduation, my friends and I all had a dance party in the room on the other side of the hall. So now I’m making new memories in this space. Anyway, our guest for today is one of crypto’s biggest stars, one of its biggest leaders who, himself, started in this space as a journalist. Please give a warm welcome to Vitalik Buterin, the creator of Ethereum. Welcome, Vitalik.
Vitalik Buterin:
Thank you. Good to be here.
Laura Shin:
Thanks for coming out to New York for this. I really appreciate it. So I’m going to jump right into questions. Normally in journalism, if you’re an editor, they say you should give your comments to writers in what’s called a nice sandwich, and you could apply that concept to interviews, but unfortunately, I’m going to have to dispense with the nice parts in the beginning because I really want to get to the meat of the conversation. We have a very limited time.
So my first question is kind of like a question that’s actually for you and for the audience, and actually, what we’re going to do, to tee up the questions, we’re going to play a video, and it’s a video…I think you’ve probably seen it, and some may have seen it, but for those who haven’t, it’s a video of Fred Wilson at Union Square Ventures in conversation with Tushar Jain of Multicoin Capital at the Multicoin Capital Summit, and I think Fred’s view here is representative of a lot of of people’s.
That it’s not just his opinion, but you can see he has kind of a lot of emotion about where Ethereum is right now. So, for the audience, my question for you is you’ll watch the video, and then we’re going to go to this website called Slido, which is sli.do. Some of you may have actually pre-submitted questions there earlier, and you’ll enter the code Unchained where you can answer this poll, and the question is, you know, do you agree with what Fred Wilson is saying here, which is, is Ethereum losing its lead? So, again, that’s sli.do, and you’ll enter the code Unchained to answer the poll. So let’s play this video, and just for context, at the beginning, he’s talking about strong executive leadership.
Male Speaker:
And we do that a lot for our companies. Ethereum needs that, right? We know that Vitalik is not CEO. Vitalik is an evangelist. He’s a brilliant computer scientist, but like, Ethereum should be more like a company, right? You look at what EOS is doing, and you look at what Ethereum’s doing, and it’s like, you know, if Ethereum was doing was EOS was doing, they’d be crushing it, but they’re not, and they don’t have enough money. They don’t have enough developers. Their go-to-market strategy is non-existent.
Like, they’re not behaving like a company, and if all of us who want Ethereum could go to Vitalik and say, you know, look, this thing you got going in Switzerland, it’s not working. Fire these fuckers who don’t know what that hell they’re doing, and put somebody great in there who could help you build this thing into a monster, like, that’s what we would do. I don’t know how to do that. Like, there’s no mechanism to do that, and that’s painful. Just sitting there holding the asset, just watching them whittle the value away, and you’re like God damnit, you know, I know what to do here.
You know, just look at it. Every great company has done this. Just do that, and they don’t do it, and it’s hard to get them to listen, right, because, first of all, who do you have to convince, right? In this case, maybe it’s Vitalik, but there’s a whole decentralized group of developers, et cetera, that need to be convinced, and this is exactly kind of the question that we’re trying to think of, is, well, if that whole group thinks that they’re killing it, then they got their head up their ass, okay? They’re not killing it. They’re blowing it.
Male Speaker:
They have the lead.
Male Speaker:
And they’re blowing it, and it’s just like, it’s so obvious what to do, and they’re not doing it.
Laura Shin:
So, okay, if you are in the audience and on the live stream, go to sli.do, and vote for this poll, but we’re not going to show the results because what I want is I want Vitalik to give us your response to what he’s saying in this video.
Vitalik Buterin:
Yeah, I mean, I guess, first of all, like, if bitcoin was run like a business, would it have succeeded? And I feel like we kind of intuitively know the answer. So it’s definitely a structure that works for some things, but blockchains, and cryptocurrency, and all of those things that come with that package are just fundamentally kind of so much more and so different from a traditional company or a software product. So I’m really not at all sure that that kind of model is anywhere close to the right model.
So in terms of what our model is, right, we’ve definitely had these discussions inside of the foundation, and there’s definitely been people from time to time that just said, yeah, we need to go in with guns blazing and fire those bastards, and then, you know, get their 40 people in and stick them in the middle of some utopia in Silicon Valley and get them to pay 10 thousand dollars a month of rent. Get them to work for 16 hours every day, rah, rah, rah, six months, and like, we got Ethereum 3.0 man, and like, no.
I mean, I would say, rather, that, I mean, bitcoin succeeded in large part because it adopted a model that’s very different from that, and we have been adopting a model that’s very different from that. Though, I mean, at the same time, look, one of the things that we did is for our 2.0 strategy, right, we have this approach where the foundation is not the thing in the middle that’s building everything.
The foundation, it is being a hub for things that need a hub. Like, for example, writing out the spec and specifying it, bringing it to completion, but then the work on making 2.0 implementations is distributed among Prysmatic Labs, and Lighthouse, and ConsenSys, and these other companies, and these other companies internally can be structured in very different ways, and you know, some of them could be based in one place, some in another place.
They might have different kinds of people in them, and really, if even a couple of them succeed, then at least the software implementations of Ethereum 2.0 exist, and it’s developed, and from a scaling point of view…and I, like some of our community members and public, have said, even if Ethereum 2.0 is never developed, there’s Ethereum 1.x. There’s ZK Rollup. There’s Channels. There’s Plasma and…
Laura Shin:
Yeah, so you were kind of taking issue with his framing of, you know…
Vitalik Buterin:
Yeah, like, I guess the points I’m trying to make is that there is a kind of focused and deep approach to doing things, and there is a broad approach to doing things, and we definitely are explicitly taking the broad approach to doing things, and I’d argue it’s a very good one for things like bitcoin and Ethereum.
Laura Shin:
But so, just because, you know, we’ve got this poll going, too, I’m just curious, do you feel like Ethereum is losing its lead or no?
Vitalik Buterin:
It’s definitely lost some lead to some extent, and I think that’s just because, first, it’s kind of inevitable and unavoidable because Ethereum really was the first general purpose, smart contract thing to try to do anything, and bitcoin, for example, is the first group to currency, and originally, as far as cryptocurrencies go, it had 100 percent market share. Then went to 95, and now it’s around 51, and as industries mature and markets grow over time, there’s more projects and more projects. Like, try to do different things, and people learn over time that there’s more different models that you could try, and there’s different projects that are trying to different models, and that part’s an inevitable part of the process.
Laura Shin:
So, wait, because this space is so new?
Vitalik Buterin:
Yeah, I mean, the space is so new and because the space is just becoming less new over time.
Laura Shin:
All right, so let’s just quickly look at the results. I’m just curious to know. Okay, so, actually, people mostly strongly disagree that Ethereum is losing…okay, so, good. That’s good because from some of the behavior I’m seeing on Twitter, I wondered about that, although, honestly, to be fair, this is probably an audience that’s very friendly to you. So one other thing that I wanted to ask, though, about this kind of competition aspect is Ethereum has always been kind of very unicorns and rainbows when it came down to blockchains.
You had Zcash, and Eternity, and perhaps even other blockchain teams at Devcon 4, but you know, at the same time, we’re seeing this new movement I guess, really, in Ethereum where recently Ethereum core developer Afri Schoeden tweeted Polkadot delivers what Serenity ought to be. Change my mind, and he was attacked on social media and actually driven out of Ethereum. I’ve had other people express anxiety to me about Polkadot, presumably because it could make Ethereum one of many parachains instead of Ethereum being the launch pad.
There’s also worries about Substrate. I mean, there’s all kinds of things going on. So right now, you know, here we are. You’re trying to build this thing that it’s not going to be done for a couple years. Meanwhile, Polkadot and some of these other potentially competitive blockchains are either launching soon or have recently launched. So do you worry that your roadmap is too long compared to where they are in their development?
Vitalik Buterin:
I would say, first of all, that pretty much every project is generally optimistic about what they say they’re going to do. So, like, for example, even, you know, bitcoin sidechains…remember back in 2014, three months after the initial announcements when bitcoin sidechains were the thing that was going to kill Ethereum? No, it was like the first of the Ethereum killers.
And people were saying, yeah, Ethereum doesn’t need to exist anymore, and then now what do we have? Well, there’s, like, one sidechain, which is basically a permission consortium chain between exchanges. So things definitely…all of these things are harder than they seem, and even after launch, things are harder than they seem, and a lot of the problems that we see that are also problems that all these other projects are going to see.
Laura Shin:
So you’re not worried about Polkadot or…
Vitalik Buterin:
I’m definitely not worried about them replacing Ethereum or any of those kind of more extreme versions. Basically, because I do think that building…Ethereum isn’t just a technical thing. There’s also an ecosystem to build out. There’s tools other than a blockchain. There’s a community to build. There’s all these things that do really take a significant amount of time.
Laura Shin:
But why do you think this strain of Ethereum maximalism is emerging? Like, literally, on my way over here, I saw that Taylor Monahan had a tweet about it earlier today, too. Why is it happening, and what do you think of it?
Vitalik Buterin:
Yeah, it definitely…like, in general, I think…I forget where I made this comment, but it might’ve been in some conversation with Tyler Cohen or somewhere else. I made this comment that people are at their most evil not out of greed, but out of fear, and it is probably true that there’s a new wave of people making noises about how they’ll basically kill Ethereum, and that does lead to people being afraid and people kind of taking that not too well.
I mean, that definitely isn’t something…like, I definitely really wish and hope that the Ethereum community can kind of find a way to interact with these other crypto projects that are emerging that’s not Ethereum maximalist, not maximalist in general, and the horrible ways and connotations that that word has. Though, I mean, at the same time, there’s also this other opposite current where people are…
I think there are some people that are worried that because we have this anti-maximalist culture, that basically is the reason why, like, in the Ethereum space, people just immediately basically call other community members out for being maximalist, which isn’t something that happens at all in many other crypto communities, and basically, there’s this kind of countercurrent where there’s other people who basically believe that the anti-maximalists are kind of being played for chumps.
Like, they’re playing Cooperate when other people are playing Defect in the Prisoner’s Dilemma, and that might be true sometimes. Might not be true sometimes, but it’s something that we need to kind of probably carefully consider and evaluate on a case-by-case basis.
Laura Shin:
But so what is your take on competition? Would you be upset if there was another, you know, competing blockchain that took the lead? How would you personally feel about that? I’m curious.
Vitalik Buterin:
It depends which blockchain. I think, you know, like, I’m not afraid to shit on projects I think are terrible, right? So if TRON overtakes Ethereum, then, first of all, continue to believe and to build on Ethereum because I believe that the world and humanity needs to have a decentralized platform, and second, I will have lost a certain amount of hope for humanity, but not all. Not nearly all.
So, I mean, if it’s some, like, very reasonable and very competent technical platform, then, ultimately, I hope to find ways to have enough positive collaborative relationships with these projects as much as possible, and I feel like the Ethereum community has shown that it’s capable of doing that.
Like, for example, it’s had a very positive relationship with Zcash pretty much since the beginning, and relations are even warming with Ethereum Classic recently, and even, I mean, I don’t know if you’ve seen the recent Peace Bridge Project. I mean, even Bitcoin Cash tends to be fairly friendly, especially now that it’s basically kind of exorcised it’s big demon within.
Laura Shin:
You’re talking about Craig Wright?
Vitalik Buterin:
Yes. You see, I’m not afraid to criticize. Yeah, so I guess the ideal outcome for me, definitely…I’ve said anti-maximalist things in general. Like, when the maximalists were just bitcoin maximalists…and I really do believe in my heart that that guy wants to see an environment where different approaches to things can thrive and prosper, and if Ethereum can win and other projects that do interesting things, too, and if we can find that way, I think that really would be best, but if that can’t happen and Ethereum ends up just being much less relevant because people switch from it to other technologies, I’d definitely much rather it be some competent technical chain than one of these scam projects.
Laura Shin:
All right. So one other thing I wanted to ask about this video was back when this was circulating on Twitter, somebody tagged you in some tweet related to it, and Preston Van Loon of Prysmatic Labs, which is creating a sharding client for Ethereum 2.0, responded to it saying that he and others on his team were struggling to deliver because they still had to work these full-time jobs, and for those of you who missed it, Vitalik wrote back YOLO and sent Prysmatic a thousand ETH, and then that was what made both of them quit their full-time jobs, or at least Preston, and he runs Prysmatic full time now.
So I saw this happen, but also we’ve got these Ethereum core developers that have been telling me, you know, they’re working on some of the most essential aspects of Ethereum, but they’re under-funded. Sometimes their salaries are at maybe 60 percent of what they would be if they were working in a startup as a developer, and even with a startup, they’d also get equity, and meanwhile, they watch the Ethereum Foundation give, you know, like, 4 million dollars to StarkWare, which is a competing blockchain.
Vitalik Buterin:
StarkWare is not a competing blockchain.
Laura Shin:
Oh, okay.
Vitalik Buterin:
No, it’s a company that’s just building ZK Stark technology.
Laura Shin:
Oh, okay, but is that still something that you would give a higher priority to compared to some of the core Ethereum teams? Because, for them, they feel like, wow, you know, how are these funding priorities being set?
Vitalik Buterin:
Those are definitely very reasonable questions to ask. I think it’s also important to recognize this sort of in the context of the history of the foundation, and its funding capacities, and some of the inefficiencies in its funding capacities. So, like, for example, back during the sale, we had 18 million dollars, and that 18 million dollars quickly turned into nine because we weren’t able to turn it into cash quickly enough, and just because of a kind of quite spendy culture that some people in the foundation had early on, the nine whittled down to one fairly quickly.
But then, fortunately, the Ethereum launched. The foundation had ether, and that made it adopt this very careful and cautious attitude toward pretty much funding anything, and so our expenditures were pretty low, but then the ether price just suddenly shot up by a factor of literally more than a thousand, and our norms definitely didn’t adjust kind of as quickly as the realities did, and then there was another correction.
And at the start of last year, we announced this big grant program, and the goal of that was to basically…it’s kind of like a triage project to identify the biggest categories of things that were not getting funded that just needed to start getting funded. So some of the earliest stuff included L4 state channel stuff. It included some of the ETH 2 client teams. It included some Plasma projects. It included some other things.
It included these big academic grants, and those things really did need to be funded, and now, more recently, of course, the price went down by a factor of 10 again, in part because we didn’t end up getting out of hand and actually adjusting our spending up by a factor of a thousand. We have not had to do any rounds of layoffs. We haven’t had to do any of those things.
Laura Shin:
So some of this is kind of organizational…I saw you tweeting about how people could be paid via smart contracts in a very flexible way. Maybe that’s something you guys should look at.
Vitalik Buterin:
Yeah, and there’s definitely kind of internal experimentation happening. Part of the benefit of this sort of Ethereum core foundation structure that’s not a corporation that we’ve developed over time is that there’s a lot of little projects and little experiments happening inside of them. So I think AFSA’s team, some of them have been getting paid in DAI, and then there’s people getting paid with these channel mechanisms. There’s grant. There are salaries. There’s, like, all of these different scales of things. There’s trials, what we called hack-tern-ships, and a bunch of other things.
Laura Shin:
Okay, but just to go back, in general, I feel like from what I’ve learned from some interviews is that there are people working on this who feel like, hey…
Vitalik Buterin:
That’s true.
Laura Shin:
How are these priorities being set, and so it sounds to me like there’s probably room for improvement, at least from their perspective.
Vitalik Buterin:
Yeah. I mean, there definitely is. Though, I think, I mean, look, whoever said that, I don’t know their specific situation, but it’s also important to remember that especially during the periods we’re adjusting downwards, if nobody’s complaining, that means you’re overpaying, basically.
Laura Shin:
Yes. Yes. Well, okay, so let’s keep talking, actually, about this specific topic because there’s been a new development where, as you probably know, there’s this new decentralized, autonomous organization called Moloch DAO. For those of you who missed it, my episode that came out on Tuesday was great about this, like, super interesting, but essentially, Moloch DAO is a DAO where members will be voted in, and upon acceptance, they receive these shares that give them the ability to vote on different proposals that will help further Ethereum 2.0 development. What’s your take on Moloch DAO?
Vitalik Buterin:
It’s definitely an interesting experiment, and first of all, I’m really glad to see people in the community taking charge and just making these independent pushes to kind of promote, push Ethereum and the Ethereum ecosystem forward in the different ways that they think make sense. I think that’s valuable both because we have the benefit of these different philosophies getting tried.
It also means that if the Ethereum Foundation does have institutional constraints a lot of the time, like these other organizations or DAOs or whatever don’t have them, or they have different constraints, and so they can kind of fill in some of our gaps. So I think all of those things are good. The one big challenge that I see is that, ultimately, these nonprofit DAOs are still just basically a way of organizing charity spending.
They can provide some improvements, but ultimately, this kind of public goods problem that basically people are throwing money into things that benefit way more people than just themselves, and so unless they’re really, really altruistic, they’re going to put in far too little money to actually…like, basically, far less money than kind of would be optimal if everyone sort of had everyone’s interests in mind.
Then, basically, the DAO by itself doesn’t just magically make these public goods problems and tragedies from the comments go away, and so there’s definitely…I’m very grateful to all of the people that have contributed to Moloch DAO, but at the same time, Moloch DAO by itself is still…and I don’t expect it to, you know, balloon into EOS sized pools of money that can go and do the kinds of things that people that want us to have EOS sized spending want us to do.
Laura Shin:
Yeah. Yeah, no, I think that’s true, because the actual DAO was something where people were expecting a return, but this is…again, it’s going to have that free rider problem where other people in the community will be like, okay, they want to put their money into fund ETH 2.0 development, fine.
00:26:28 No Audio 00:26:43
Laura Shin:
But one other thing I wanted to ask about was there’s this other idea floating around, which is inflation funding for development, and you know, Zcash does it, where it’s 20 percent of the block reward goes to fund such a development. What do you think of that idea?
Vitalik Buterin:
Yeah, and I did read the EIP. Was it 1867, or some number in that range, that was released today? It’s interesting that people are starting to discuss it, and I think probably two of the big challenges to that, I mean, one of them is kind of just political, which is the community I think hasn’t fully decided how it feels about the governance making subjective economic decisions on that level of subjectiveness, and so, for example, the bitcoin community would definitely be hard against this sort of thing.
They’d even be hard against redirecting parts of the existing block reward, even if it keeps the cap, to things like this because, you know, they would say, oh, it’s centralization. It’s taxes, and these things are evil and all that. You know, on other hand, you have projects that…take the opposite extreme and basically use just on-chain governance to push out inflation rewards to projects, and I’ve written articles about how this can…like, this is just fundamentally not incentive compatible. It can lead to plutocracy.
It can lead to cartels, and I think it might even be possible to make it kind of almost a mathematical theorem that basically says something like, in an anonymous system, it’s impossible to create a system that funds public goods without creating a system that rewards cartels, and the reason is that there’s just no way for anonymousness to distinguish between 10 million dollars of coins split between 10 thousand people that are struggling to overcome free rider problems, versus 10 million dollars that are split between 10 thousand accounts that are all owned by the same cartel that’s just one guy trying to funnel more money to themselves.
And you know, in the case of EOS, for example, you know, we saw these scandals about, oh, you got these delegates, and then they’re voting for each other, and then they’re voting in exchange for payments and all of these things that kind of technically break voting systems if you analyze the economics, and I do worry about that kind of capture if we make a system that’s kind of formalized in the wrong way. Now, in the middle, there’s…
Laura Shin:
Basically, it’s gamifiable?
Vitalik Buterin:
Yeah. I mean, in the middle, there’s Zcash, but then Zcash is interesting. It’s definitely big props to them for just doing that and being proud of that and saying, like, yeah, you know, we got a 20 percent def tax. You know, what’s up, man? And I am very proud of them for doing that. So, you know, great job, Zooko, but on the other hand, like, they clearly haven’t solved the problem of where to allocate the money, because right now, they basically just have this centralized allocation pool that goes to Zcash company. It goes to these individuals and these other individuals, and they have hard forks.
And in these hard forks, they can decide to re-allocate the pool, but then what process do they use to decide? And so it’s definitely very far from kind of the ideals that a lot of people see cryptocurrencies having, and like, that’s definitely very far from saying Zcash is bad or anything. It’s still an improvement over no funding, but you know, centralized funding is still…it would be really nice if there was some decentralized process for achieving the same thing. Now, in terms of decentralized processes, I’m a big fan of Glen Weyl’s CLR quadratic finance mechanism.
Laura Shin:
Yeah, can you describe that for people? He was on the show, too, by the was. That was a great episode. You guys should listen to that.
Vitalik Buterin:
Yeah, so, basically, the idea here is that it’s a kind of…expand on one of Glen’s earlier ideas, which is quadratic voting, which is a method for voting which basically takes into account the strengths of people’s preferences, and under certain conditions, you can prove that, basically, if A wins a quadratic vote over B, then A is, like, on balance. Basically, A makes people altogether happier than B would.
And it’s the way that overall radical subsidies work, is that you have this mechanism where anyone can, like, put in some money toward projects, and then for each project, there is a set of people that put money into it, and then the way it works mathematically is that you take each person’s contribution. Then you take the square root of each person’s contribution.
Then you add all of those square roots up, and you take the square of that sum, and then the square of the sum of the square roots is bigger than just a regular sum, and pretty much always, if there’s more than one contributor. So you have some, like, central funding source basically cover the difference. The way that it works kind of more philosophically, you know, you might ask, well, why square roots? Why squares? Why sums?
Is that you can think of it as a mechanism that…the root of the amount of money that each person contributes kind of measures, basically, how much they care about the project, and in a certain mathematical sense, and then the mechanism itself imagines if there existed a kind of virtual agent that cared as much as all of the contributors care put together, and that virtual agent was the one that had a lot of money to contribute, then how much money would they contribute?
And that amount is always going to be more than the amount that people contribute in isolation, because this kind of version agent that cares as much as all the contributors put together is sort of one agent and doesn’t have free rider problems with itself. So it’s really cool math, but the general principle is that it’s this way…like, if you have a pool of money that is designated toward funding public goods as a category, then it allows you to choose which public goods to fund and how much in a way that is credibly neutral and not biased towards specific organizations.
Laura Shin:
And would you think about using that to experiment with inflation funding?
Vitalik Buterin:
Yeah, and so Gitcoin is using it right now, and I think it started…the first round, in my opinion, went really well, and it started the second round recently. The main impediments I see to just pumping Ethereum inflation directly into a CLR is that CLR does depend on some notion of identity. So, basically, the reason is, once again, how do you distinguish between 10 thousand people that are suffering from, like, a free rider problem versus 10 thousand sock puppets of the same rich guy? And fake accounts are really easy to get. If you have a phone right now, if you go to Buyaccs.com, you can just buy piles of gmail and Reddit accounts. Just go ahead and look and try.
Laura Shin:
Is this something you’ve tried?
Vitalik Buterin:
No comment. No, like, the point…it’s important to not be naïve about this because, you know, regardless of what any of us know or try to do, there’s entire industries of people who spend their lives as a full-time job figuring out how to grab up these accounts and automate them, and then if they rely on cell phones, then they have those cell phone racks, and they hook them up, and they simulate clicking buttons. I mean, there’s PR firms that do this. This is basically…
Laura Shin:
There’s crypto teams that do this, crypto people. Yeah.
Vitalik Buterin:
Yeah. Yeah. I mean, I’m, what, like did hacking team do any of that? I mean, I have no idea.
Laura Shin:
I don’t know. I don’t know, but I mean…
Vitalik Buterin:
So, yeah, basically, the point is that if you don’t have an identity system that’s robust, then, eventually, you’re going to have a guy with 10 thousand sock puppet accounts taking over this kind of system and using it to drain money, and so this does depend on a robust identity system, and it also depends on collusion resistance, which is the term I use for mechanisms where you don’t have the ability to prove how you participated to anyone else, and the reason why that’s important is because if you don’t have that property, then you can really easily bribe people to participate in some way with smart contracts.
Like, if you imagine for votes, the idea of buy-in votes is probably familiar to people, but this applies to any kind of mechanism right? Even, like, with a CLR, for example, right, if I throw in 10 dollars, then I get 10 dollars square root, 3.16 whatever, and then square again up to 10, but then if you were to throw in one dollar, then my 10 dollars gets square rooted, 3.16. Add to yours, 4.16, and then the result would be somewhere between 17 and 18.
And so your one dollar adds somewhere over seven dollars to the total pie, and so that would mean is that if you could prove how you voted and that it was malicious, then I would bribe you with three dollars just to throw one dollar into the pot. You would earn two dollars, and I would still earn more than a five-dollar profit. So, like, these attacks exist, and there are worldwide industries that are dedicated to exploiting them, so we need to be careful.
Laura Shin:
All right. Yeah. So all this, if you ever end up implementing it, it sounds like it’s going to be way down the line because I know there are other things on your to-do list that are higher up. So let’s move on. One other thing…so we were talking about Moloch DAO. One other thing that came out of this interview I did with Ameen, who founded Moloch DAO…Ameen Soleimani, by the way, for those of you who don’t know him. He believes that the Ethereum community should put a great emphasis on the price of ether because of its roll in securing the network, especially under proof of stake, and did you see that Delphi Digital report?
Vitalik Buterin:
Yes.
Laura Shin:
Yeah, that was super interesting. If you guys missed it, incredible report, but basically, they talked about how the upgrade to Serenity would rely too much on fees and that kind of put the security of the network at risk, and they showed a number of scenarios. It really wouldn’t be very profitable for validators. So do you think the price of ether is important, and how much do you think about that while you’re designing the protocol and working on things like fees, block rewards, staking, inflation, et cetera?
Vitalik Buterin:
Yeah, I mean, I’m going to be really candid because that’s the right thing. I think a lot of the…at least some of the earlier kind of rhetoric of especially veering on the more extreme side of the price not mattering at all came…I mean, in part, it was kind of countersignalling to distinguish ourselves from other crypto projects that just do pumping and lambo-ing way, way too much, but in other things, that it was about minimizing legal risk by basically trying to kind of make the project seem more distant from something that would be covered by financial regulation.
And I think more recently…I think at this point, you know, people and regulators know what cryptocurrencies are, and they know that it’s good…they have a price. There is a cryptocurrency. These prices go up and down, and there’s these networks, and these networks, you know, you can build applications on them, and these applications provide a lot of value to people, and if people try to claim that price doesn’t matter at all, they’re totally going to see through that, right?
Laura Shin:
So how much does it matter to you?
Vitalik Buterin:
I mean, I can tell you why…like, what things are clearly important about…why the price being higher rather than lower, for example, is good, right? So one of them is obviously security. So if the price is zero, the network can’t be secure, and that’s true in proof of work or proof of stake. Another reason is, obviously, that there’s a lot of projects in the ecosystem who hold cryptocurrency, and either…and if the price is higher, then they’ll have more money to do the things that they want to do.
These are things that are just obvious and you can…it’s just obvious from looking on the internet that crypto projects hold a lot of their money in cryptocurrency and they’ll be better funded if prices go up, but from a network point of view, also I know security is just an important kind of thing…basically, if prices drop to zero, then there’s no way that security can happen. So I think in terms of descriptively explaining why people do care, it’s obviously a combination of those things, and then there’s people that hold cryptocurrency and they want prices to go up.
Laura Shin:
Yeah, sometimes I think that’s what the maximalists are…
Vitalik Buterin:
Yeah. Definitely, but I think those…I mean, especially the security concern is definitely just a totally legitimate technical argument, and there are members of the Ethereum community that just say that, you know, either it’s a cryptocurrency and we want it to be more of a cryptocurrency, and that’s something that…like, the Ethereum Foundation, I think it’s become clear, doesn’t have a monopoly on Ethereum messaging or even a hegemony on Ethereum messaging at this point, and that’s a direction that people like Moloch DAO and other groups are going to promote. Then there’s not much that we can do to stop them even.
Laura Shin:
Okay. So, actually, I want to do another poll. So if you guys want to take out your phones, and also for you on the live stream, go to, again, sli.do, and I just want to ask you this question. Do you think Ethereum developers are focusing enough on the ether price, and we’ll just look at the results right away because I’m just kind of curious to know what the community feels about that. Oh, okay, so we’ve got a lot of don’t cares. That’s interesting. Oh, but so there is more…there’s a little bit more yes. Oh, there’s some people who just are like, I don’t know, but just don’t cares.
Vitalik Buterin:
That’s interesting. Yeah. I mean, don’t care. Yeah, no.
Laura Shin:
Well, there you have it. So there’s all these critiques out there…
Vitalik Buterin:
That’s so interesting.
Laura Shin:
That is really interesting, actually.
Vitalik Buterin:
Yeah, I mean, I think also it depends on how you ask the question, because there’s a difference between…look, the thing that I am absolutely opposed to is for just engineering for pumps for the sake of pumps, right, because that’s just a short-term strategy that’s fundamentally dishonest. The thing that I’m definitely in favor of is, like, not doing stupid things that would lead to the price going to zero. So one example of that would be just having an issuance of 100 million ether every year, right? Regardless of what other consequences that has, that would clearly drop the price to zero, and that would clearly just be terrible.
Laura Shin:
Right. So I want to actually ask you about something somewhat similar, because, obviously, we’ve gone through this recent bubble, this ICO mania. I’ve heard you express relief that that’s over, but I’m just curious to know, how do you feel about the fact that a large part of Ethereum’s success came from the fact that it was used as this launch pad for the ICO craze?
Vitalik Buterin:
It’s definitely true to some extent. I mean, to some extent, though, ICOs are something that’s just going to happen on some platform regardless of what platform it ultimately was, and before Ethereum, there was Mastercoin and other things happening on bitcoin. Then before Ethereum launched, there was MaidSafe, and there were all these other projects that were launching, and they were using kind of bitcoin-based second layers.
So I feel like that boom would’ve happened regardless of what platform it ultimately would’ve happened on, and it’s definitely a kind of complex situation that’s had a lot of costs and benefits to it. I mean, one of the big benefits is just a lot of interesting projects getting funded, and there’s a lot of big Ethereum projects that had token sales. There was a lot of projects that did not have token sales, but that had tokens that launched in other ways, so Maker being one example, and the fact that they have money for development is I think just a good and useful thing.
Laura Shin:
But then what about the fact that whole other… scams?
Vitalik Buterin:
That whole other space? Yeah, I mean, that’s definitely one of the biggest costs, that there are these projects that were just scamming. There were projects that were marketing just way over the top and excessively. There were projects that would run up beside me, just take a selfie, run away, and then claim that, you know, oh, I took a selfie…like, founder of Enjin KuCoin look a selfie with Vitalik Buterin. Please buy our ICO.
Laura Shin:
Right, or like, you were an advisor. I even was listed as an advisor.
Vitalik Buterin:
Yeah, there’s a bunch of stuff that I’m apparently an advisor for, and also in my 10 thousand Instagram accounts, they’re all scams. Yeah, and those are definitely very unfortunate things. I mean, if there were magic wands that could’ve shut them all down, that probably would’ve been better, but magic wands don’t exist.
Laura Shin:
Well, speaking of things that shut things down, so I wanted to ask you, over the past, the SEC has said in various ways that ether in its current form is not a security. However, from the way they phrase their remarks, it seems that they likely would consider the Ethereum crowdsale as violating securities laws. Are you worried about an enforcement action against you or the other founders?
Vitalik Buterin:
It’s something…I mean, so far, we haven’t seen anything suggesting anything like that happening. I mean, we definitely have our lawyers and legal teams, and they’re definitely watching the situation closely, but so far, we haven’t seen any reason to be worried for ourselves.
Laura Shin:
And is that something you stress about at all?
Vitalik Buterin:
I would say no. I’m mainly listening to our lawyers and legal teams at this point.
Laura Shin:
All right, so I wanted to just go back to what you were saying about Glen Weyl. You know, here you have created this 15-billion-dollar ecosystem, but from somebody who is trying to cover what you’re doing, I definitely know you have your hands in a little more things that actually just Ethereum, and when I recently interviewed Glen, he actually said that you are his closest collaborator. So what are you doing with him, and how does it relate to your work with Ethereum?
Vitalik Buterin:
Yeah, in terms of what I’ve done with him, I sent him a review of Radical Markets. I wrote a review of Radical Markets that’s still sitting there in the big, long 5-thousand-word thing on Vitalik.ca, and worked on him on the Liberal Radicalism paper. I reviewed some of his recent posts on why I’m not a capitalist, why I’m not a statist, and all of those other things. In terms of kind of concrete items, those are probably the biggest, but I guess more generally…
And I’ll actually be touching on this topic a lot in two days because I’m going to RadicalxChange right after this, but I view the kind of cypherpunk tradition and the RadicalxChange tradition that Glen Weyl has created so quickly as being two definitely different movements, but that are still ultimately going after fairly similar goals, and the way that I would describe those goals are as being this attempt to kind of synthesize valuing things like freedom, and openness, and systems where everyone is on an equal footing and there’s no special privilege with an understanding of the value of community.
As far as understanding the value of community goes, that’s definitely not a universal in the cryptocurrency space by any means, right? There’s definitely things that the Ethereum space has cultivated that are almost a reaction to things that other people in other cryptocurrency communities have said. You know, there’s people that literally go around saying things like, oh, you know, there is no insert coin name here community. There’s just a bunch of people that happen to use the same coin, and that’s what matters, and I consider those kind of ideas totally crazy, and that’s something that…
So I feel like, you know, there’s the cypherpunk tradition, especially 10 to 20 years ago, started out as something very individualistic, but then as it started moving into money, and moving into cryptocurrency, and moving into these other blockchain applications, it’s started to realize that even on a technical level, like, money is a much more kind of inherently social thing than, for example, end-to-end encrypted messaging.
And because of that, you just unavoidably have to deal with proof of work, proof of stake, soft forks, UASFs, hard forks, governance, Reddit censorship interfering with governance, and this entire mess of messy human issues, and coming up with ways of dealing with that, mitigating and minimalizing the worst of it. Trying to benefit from the best of it is a journey that…the part of the cypherpunk community that’s made its way into both Ethereum and other communities, as well, including Zcash and including all of these other projects.
Even though I disagree with their approach, including the projects doing on-chain governance and so forth, as well, and then on the RadicalxChange side, you have people that basically see things like Brexit and Trump and all of that, and that are basically kind of dissatisfied with pretty much every major political trend because they all kind of miss different parts of the picture and are trying to come up with a new approach that satisfies the ideals of what a lot of people wanted out of capitalism, for example, and even out of socialism, but does both in a way as they perceive avoids the pitfalls of both of the earlier approaches, and so there’s definitely a lot of common strands in terms of people’s goals, but there’s differences in terms of people’s approaches. There’s difference in opinion. So, for example, Glen, he has this line where he dislikes blockchains because they formalize property without formalizing individuality.
And whereas in our space, we have Andreas Antonopoulos writing this article a couple of years ago where he literally says, like, against identity and reputation systems. So that’s one example of one of the biggest, probably, wedges between those two, but I mean, if they’re not literally the same community, there’s always going to be wedges, and it’s interesting to try to kind of navigate these through different approaches and see what they can learn from each other.
Laura Shin:
So one other thing that I want to…because when I look at what you’re doing with Glen, it sort of feels like you’re kind of branching out just from Ethereum to trying to do things in the wider world, and when I look at sort of where things are going in the wider world and how that intersects with cryptocurrency, I feel like I’m reading a lot these days about this fear about the future of work, you know, automation, robots, AI, and there are now these proposals around things, like universal basic income, and you know, here we work in this space where we have digital money and ways to disperse it. So how do you think blockchains will affect the future of work for good and for bad?
Vitalik Buterin:
Yeah, I mean, first of all, coming up with better solutions to this whole identity reputation and more generally, formalizing community is definitely something that we need to have more work on if we want to have more high impact to blockchain applications in these areas, because, like, without that, you know, you can’t distinguish 10 thousand regular people from one rich guy with 10 million dollars, and that’s just going to limit you in so many different ways.
But if you can solve that problem, then, potentially, you could make a lot of progress, and I think in the shorter term, the main value of these systems isn’t so much in kind of formalizing specific new mechanisms that entire large portions of society will be building on instead of corporations or governments or whatever. I think in the near term, the thing that’s more viable is basically blockchains as a way of making it just easier for more people around the world to connect into the global economy and also easier for different existing projects to interface and interconnect with each other more.
So one of the pitches that I talk about is the idea that…and you can see the people are starting to explore this very concretely in the gaming industry, this idea that you have a bunch of small companies that…and there’s some big incumbents, and then there are some small companies, and the small companies by themselves have a hard time, but then if they can create some kind of common market or interoperability between them…so in the case of gaming, moving or trading assets between games.
In the case of something like financial systems, it’ll be these different wallets or different providers or whatever being able to talk to each other, and by doing that, they can basically share network effect and kind of stand up against larger monopolists without themselves kind of coalescing into a monopolist, and I think that’s a path that’s also very socially valuable.
But then, in the longer term, as more things happen on blockchain and as maybe we have more data sources, we have more kind of formalization of things like reputation, and identity, and community, then some of these grander and more idealistic visions can also start to see the light, and we can really use blockchains as a platform for just experimenting in very different ways of people organizing with each other.
So I think those are definitely all good consequences. In terms of consequences that I’m worried about, I mean, near term, just the whole…the dark side of the ICO mania basically and kind of in a more generalized sense, also scams, hacks, thefts. All of that side is definitely an issue that I think we could be doing more to try to mitigate and fight off.
Laura Shin:
Yeah, I was listening to this other podcast. I think it was Software Engineering Daily with Haseb Quareshi did an essay where he just read it, and it was amazing, but it was funny because he was saying that he feels like, in the crypto space, we’re sort of learning all the lessons that traditional financial systems already learned, and that’s why they have all those regulations in place, and so it’s just funny, but actually, that is another question I want to ask you about.
And I think this’ll be our last question, actually, before we do some Q&A. We’ve seen this fascinating defy trend that’s been taking off on Ethereum. I’m a little bit obsessed with it. For those of you who didn’t notice, I did 0X, and Dharma, and dYdX, and Compound, and Maker. I’m super interested in all this stuff, but some of the ideas that are being put into place have the echoes of the financial moves that led us into the 2008 financial crisis. So what’s your take on that?
Vitalik Buterin:
I don’t know if you saw maybe 1 to 2 weeks ago on Twitter, but there was this one project that was promising, like, 5X leverage with crypto-based derivatives, and I went on there and criticized them, and I thought they had some pretty reasonable answers to my critiques, but I think, even still, it’s important to do things like that and kind of set the expectation that we’re not here to build things that break.
And I think having the DAO happen so early in the history definitely had some positive effects, because it definitely kind of did create, like, a necessary sense of fear and caution. Though now it’s been almost three years, and that’s definitely not something that’s going to last forever. So, yeah, I’m definitely watching the whole defy space with interest and fascination, and I’ve been very supportive of Uniswap, for example, all the way through. Hi, Dan, stand up.
Laura Shin:
He was on Unconfirmed last week. That was a great episode.
Vitalik Buterin:
Yeah, I mean, you know things like Maker, it’s just a project. It’s useful, and that’s so refreshing and great, and Augur and so forth, but on the other hand, something will break eventually. Actually, I mean, there’s two kinds of breaking, right? So one kind of breaking is the kind of breaking that financial systems breaking that people are more familiar with, which is, oh, you have these derivatives, and then because people underestimate the fat tail, suddenly, things all go in one direction at the same time.
Then some things break and go bankrupt, and other things that are dependent on those things not breaking also break, and you have these cascades, and suddenly, a whole bunch of systems just fly wildly out of people’s expectations. The other kind of things breaking that I’m also worried about is smart contract code risk. So, for example, this was another case of actually myself criticizing our own community on Twitter, which…
By the way, I do think Ethereans should criticize Ethereans both on Twitter and other platforms. It’s definitely healthy to have the kind of antidotes to the extremes of booster culture and all that, but basically, someone was trying to say something like, oh, you know, why doesn’t pretty much everyone take their money out of their bank accounts and put it into a DAI earning interest on compound because that pays better rates?
Like, why would you not just get a free 3 percent? And I’m like, excuse me? Free? You really believe that contract has…are you really that confident that that contract has less than a 3 percent chance a year of having a bug in it? I mean, I honestly don’t know how to measure the chances if those contracts have bugs in them, but there’s definitely I think far too many people that round those risks down to zero.
Laura Shin:
Yeah, well, I was going to ask you about that, because more than 2 percent of all ether is locked up in Maker DAO and these collateralized depositions, and I just wonder, do you worry that that could post a systemic risk to Ethereum, like if there’s a bug or also there’s this regulatory risk, because the SEC’s been making noise that perhaps stablecoins like Maker DAO could run afoul of regulation.
Vitalik Buterin:
Yeah, from a contract security point of view, there’s definitely reasons to be more optimistic this time around, basically because Maker DAO does seem to be doing things much more slowly and methodically than, say, like the DAO did, and it’s taken them a long time to build everything out and launch, and you know, some people have quibbles with their variable naming styles, but otherwise, it’s still…on balance, it does seem like they’re doing things well.
But at the same time, I know the risk is non-zero, and it could happen, and ultimately, if you’re doing a system that’s interesting, the risk of things breaking is always going to be non-zero on the legal side, and ultimately, a bit of that just is a question for the Marker DAO team, but going beyond that, if a very large class of things that people want to do on Ethereum get ruled to be basically legally impossible, then it’s definitely going to be a very significant loss to Ethereum.
Though, ultimately, I think it’s also important to note that Ethereum’s value is definitely not limited to one sector. Like, even if this financial stuff doesn’t happen, there’s still ENS, and I made that tweet storm a few months ago on non-financial applications of the Ethereum blockchain where I talked about things like certificates, and key revocation, and identity, and all of these other things.
And I think all of those things are valuable, too, and the system is definitely going to be keep on evolving and keep on being used by someone no matter what happens, but there’s definitely things we can do to minimize the risk that people get hurt in the meantime, and I definitely strongly support everyone in the community taking it on as a common responsibility to do some of those things.
Laura Shin:
Yeah. Well, I think that’s a perfect place to end it, just sort of where we are in the system right now. So we’re going to actually queue up our first video question that was pre-submitted by listeners, and this is a super fun one. This comes from Ben from LA. Those of you who listened to my 100th episode where listeners contributed, this guy wrote and recited a whole poem, and it was a few minutes, and it was all about crypto and my podcast. I mean, it was amazing. So if you have not listened to the episode yet, his poem was a true masterpiece. I highly recommend you check it out, and he submitted a super fun video for today’s recording.
Female Speaker:
If you there Vitalik B. had a lambo time machine to join the early cypherpunk scene, what advice would you give Satoshi?
Vitalik Buterin:
So, just trying to tell, is this thing mixing Back to the Future and Star Wars metaphors? Okay, yeah.
Laura Shin:
So what advice would you give Satoshi?
Vitalik Buterin:
GitHub.com/Ethereum/Eth2.0-specs.
Laura Shin:
Wait, are you serious? You would say this is the advice I’d give Satoshi? Like, build Ethereum 2.0?
Vitalik Buterin:
I mean, I do think it’s a good architecture. Like, you might as well build a good architecture as being the first thing. Otherwise, no, if we want kind of smaller and more concrete one-sentence things, then I think…first of all, Satoshi had a really hard job because he just could not have predicted which way the ecosystem would’ve went, which way…just the fact that it would turn into anything more than a science experiment and all these other things. So I think on a technical level, at least kind of suggesting a path that opens the door to operability to proof of stake and to more powerful virtual machines and all these other things.
Laura Shin:
Wait, and by that, do you mean some sort of governance mechanism?
Vitalik Buterin:
Not a governance mechanism. Just a technical design that makes it easier to upgrade. From a kind of social point of view, definitely to pay attention more to the governance layer as something that could end up failing and getting captured. I mean, Satoshi basically just disappeared and kind of handed it off to Gavin, and then things went from there, and then they spiraled out of control a few years later, and I think, actually…oh, here’s a good one. Set explicit norms in writing, and set an explicit direction in writing.
So, for example, one of the things that we did for Ethereum early on is we said, you know, we are going to do proof of stake and sharding, and we’ve said that even all the way since 2014 and 2015, and that helped because it basically creates this community agreement that, you know, yes, Ethereum at this time is a chain that technically evolves, and yes, proposals that change it in the spirit of those ideas that are sane should be adopted.
And I think that kind of social contract of technical improvement and of technical improvement in particular directions is something that has ended up serving us very well, and probably also possibly prevented situations that could’ve otherwise led to arguments, that could’ve led to stagnation. Like, if those things had not been said, there could’ve been a much larger contingent basically saying, you know, hey, screw proof of stake and screw sharding. Let’s just keep this exactly as it is, or let’s go in some totally different direction.
Yeah, so I think trying to set a more explicit kind of path for future improvements is definitely something that could’ve probably very significantly improved the outcome. I can tell why he didn’t, right? Like, when he launched the thing, even in the white paper or somewhere, it says something like when the system is launched, the rules are set in stone forever, which ended up totally not being true, but this is what you would say if you were someone who just thinks that it is going to be a science experiment and not a multimillion-dollar cryptocurrency.
Laura Shin:
Yes. Okay, so we’ll do the second listener video.
Chanda Lodha:
Hi. I’m Chanda Lodha from San Francisco, part of the CoinTracker team. Thanks, Vitalik, for taking these questions and Laura for organizing. The question is two parts. One, what do you think is going to be the first mainstream use case for cryptocurrency, and second, what do you think about Facebook’s initiative to create a stablecoin and messaging apps like WhatsApp? Thanks.
Vitalik Buterin:
Oh, so, for the first one, I would say things I am kind of near-term optimistic about include…I mean, first of all, in the decentralized finance space. Second of all, gaming, and I do mean gaming as in video games, not as in a euphemism for casinos or what not. Third, on the non-financial side, identity credentials, key revocation, and all of those things. Just even, you know, the HTC phone with social and key recovery and all that, for example, has made me more optimistic that things like that could be done.
Basically, it seems like there are platforms that are launching that could just deploy these identity solutions. For possibly an interesting one, like I got mentioned from the community is parametric insurance. So this is basically insurance that says if some extreme weather event happens, then pay me 500 dollars, and this seems…like, the reason why it’s interesting is because, I mean, first of all, it’s very useful.
And it’s particularly the sort of thing that would be useful in developing environments, economies, and generally kind of under-financially included communities and all these other groups of people that we ultimately want to help, but also because it’s clearly actually implementable, because just all that it requires is a data source, and you know, now we have Oracle Eyes. We have Augur Oracles.
We have all these other projects that are trying to make Oracles at kind of different levels of centralization and the decentralization spectrum. So the tools are totally there to build it, and there is this project called HurricaneGuard.io that’s been actually building out the thing, and the team, I think one of them’s based in Puerto Rico. The others are based somewhere else. So I do hope to see more things like that happening, and then from there, I guess we’ll see.
Laura Shin:
And Facebook coin?
Vitalik Buterin:
Yeah, Facebook coin, I honestly don’t know enough about it to be able to comment.
Laura Shin:
Okay. All right, well, we’ll do the third video then.
Male Speaker:
Hi, Laura. My name is Frank. I’m from the UK where I run a blockchain consulting service called FH Blockchain Consulting. I’ve been a big fan of Unchained for some time. My question for Vitalik is what would be taught at Vitalik Buterin University?
Laura Shin:
So the sound on this video is a bit low, but he asked what would be taught at Vitalik Buterin University, which is a cool question, because you didn’t even go to college.
Vitalik Buterin:
Yeah, no. I mean, I guess, like, there’s definitely ways to interpret the question because there’s things that people should learn in general, but then there’s things that more people should learn, but if literally everyone in the world focused on them, that would be a disaster, but not necessarily everyone needs to learn all of them. One way to answer it is to just say, you know, things like cryptography and economics and all of the things that…the technical things of this particular space, but I think that’s almost not a very interesting answer because you can teach different things, but it matters…
Like, in my experience, it matters more how things are taught, and I feel like there’s ways…society’s tools of education are very far from perfect, and there’s ways to improve them that at least I feel like I’ve been trying to do for the spaces that I happen to be more of an expert in, but they could totally be expanded to other space, as well. So, for example, even when I was a Bitcoin Magazine writer, I quickly seized up on this kind of seeming gap that we have where, on the one hand, we have Popular Science articles that are just terrible to the point of being incorrect. On the other hand, we have…
Laura Shin:
I used to be a science writer, just FYI.
Vitalik Buterin:
Not all Popular Science articles. On the other hand, it all offends a definite group of people, which is basically math papers and anything written in latex. Even Wikipedia, that category of things, which just tends to seemingly place zero or negative value on comprehensibility, and then you have that and you have that, and there’s this wide gap in between of thing that are basically materials that actually tell you what’s going on and actually semi rigorously explain things and show, you know, here’s the actual math. Here’s how the thing works and now you can understand how a thing works to the point where you can build it, but do so in a way that actually is understandable and is relatable to people who have not taken the exact same series of university courses as the author.
Laura Shin:
Wait, so I’m going to have to stop your answer because we’ve got a bunch of questions that you all submitted on Slido, and we’re running out of time, so I’m just going to ask maybe one or two. The top-voted question is a fun one, though, which is, who was your favorite troll on the Ethereum ecosystem?
Vitalik Buterin:
Oh, can I say Kevin Pham?
Laura Shin:
You know, maybe I’d have to go with the same. I actually wrote an article about him before I was even into crypto. So we have a history, I guess you could say. All right, next one. What is the most promising ETH competitor in your eyes?
Vitalik Buterin:
Oh.
Laura Shin:
I know, you guys should all be journalists.
Vitalik Buterin:
Yeah, no, I mean, in terms of things trying to do general computation…and I tend to find DFINITY pretty technically competent.
Laura Shin:
For those of you who didn’t hear, he was also on my show. I don’t know if you would use the word competent to describe that interview, but anyway…
Vitalik Buterin:
Well, Dominique’s got really great stuff on things like threshold signatures and distributed key generation, and he does real…like DFINITY does really contribute to kind of the leading edge of the space, and that’s something that I really respect.
Laura Shin:
Yeah, no, when I was learning about the beacon chain and all that, I was like, oh, this sounds like DFINITY. So I think there’s a lot of cross-pollination.
Vitalik Buterin:
Although I think Dominique and I, we never want to use the word competitor. We use the possible euphemism, but possibly aspiration term, sister network.
Laura Shin:
Okay. All right, so we are basically out of time. This is sort of a weird place to end where we’re talking about DFINITY, but it has been so fabulous having you. So thank you so much for coming. To learn more about Vitalik and Ethereum, check out the show notes inside your podcast player. This first Unchained Live was a massive undertaking. I want to thank Vitalik again for agreeing to be grilled by me on stage and also flying out here. I’d also like to extend my gratitude to Columbia Journalism School for hosting us.
I’d like to thank our venue sponsor Quantstamp for helping to make it happen. I also want to give a huge shout-out to my event coordinator Cynthia Helen. Cynthia, back there, thank you so much. She went above and beyond in every way imaginable to make sure this event was a hit. We had a short turnaround time, and she really threw herself into the work and endured a lot of unexpected and last-minute surprises, and she really took care of everything so I could focus on this interview.
Thanks also to Ralene Gallipoli, Stephanie Bleyer, Stephanie Cohen, Liv Beher, Brittany Newman, AD Catering, Kaelin Buckley, and Tracey Ball, and let me just point out, this was an all-woman team. Totally unplanned. If you have friends who missed out on the first Unchained Live, let them know they can check out the video of the live stream, which will be at Facebook.com/UnchainedPodcast.
If I can, I will try to also download this for the Unchained Podcast website because I have been getting tweets saying I already deleted my Facebook account, which I should’ve thought of before. You know, I’m new at this. If you are not yet signed up for my email newsletter, go to UnchainedPodcast.com right now to get my thoughts on the top crypto stories of the week plus previews of exclusive podcast content, and for the true early birds, my book is coming out in two years, so keep your eye out in 2021.
Unchained is produced by me, Laura Shin, with help from Ralene Gallipoli, Fractal Recording, Jennie Josephson, Daniel Nuss, and Rich Stroffolino. For those of you in the live audience, please stick around. We’re going to continue the cocktail hour, and for everybody on the live stream and also here in the audience and also on my podcast, because we’ll be releasing it there, thank you for watching and listening.
