Blockchains as Transaction Machines with Sean O'Connor

who considers themselves technical in nature okay so good mix um well today we're going to dive into the world of blockchain and this is sort of a 201 level intro and really my goal today is to help you walk away from this presentation with some new frames and new ways to think about web3 see I've been in web3 since 2017 launched a project at 8th Denver 2018 launched a project at 8th Denver 20 19 and have been building and Advising in this space since currently over at block native full-time is the chief of staff where we're a core web3 infrastructure provider if you've used like curve metamask zapper or synthetics you've engaged with block natives libraries in the background does anyone know what SMTP protocol is raise your hand okay one person who here sent an email today everyone cool so you have all used SMTP protocol today and SMTP protocol stands for simple mail transfer packet and it is the open source decentralized protocol that governs how all email works it's what lets you send from Gmail to you at imail to you at AOL which for some reason people still use but that's how email works and it's open source standards and it's programmable and that's what makes a lot of the internet work and I want you to think about blockchains as open source programmable infrastructure for money for contracts and for a lot more so blockchains are building open source protocols for transactions and web3 really started with the Bitcoin protocol coin capital B I want you to think about as Bitcoin the cryptocurrency and it turns out the price of Bitcoin is probably the least interesting thing you can think about when you're talking about Bitcoin but Bitcoin lowercase b actually stands for the blockchain and you can do a lot more with Bitcoin the blockchain than talk about the CR the price of Bitcoin the cryptocurrency MIT issues digital certificates on it there's people building protocols on it there's people now launching ordinals and nfts on bitcoin the blockchain because it's an open decentralized programmable blockchain and once you start to wrap your head around that blockchains or the most interesting part of the crypto movement I think you'll see this space in a new light so before we dive into where web3 is going let's talk a little bit about the past so we're in Denver today does anyone know why Denver's an important place for the internet so it all started with darpanet so the internet came out of the cold war with Russia where the American federal government started building a lot of core infrastructure to build a self-routing self-healing decentralized communication Network for the entire reason that if the Soviets bombed DC or New York or others America would be able to launch a Counter-Strike so it's kind of a dark dystopian start and Denver is one of the original hubs for the internet because NORAD is just south of here the North American Rocky aerial defense so if you actually go out towards Dia when you flew in today you probably saw all that open land and all that used to be nuclear silos and used to be part of the military industrial complex it's now an airport which is a much better use of that land and then Tim berners-lee over at CERN started building the world wide web and we've all heard of a 404 error code right like does not compute have you ever heard of a 402 error code this was a part of the original design of the internet that Tim put forth and a 402 error code stands for payment required so in the original envisioning of the internet Tim and others had this idea that there needed to be an internet native money a digitally native money and they just never completed that uh Tim today is working on a blockchain enabled protocol to try and finish that original Vision so the creator of the web is working deep in web3 to try and bring this Vision full circle and actually complete the work he started at CERN all those years ago internet payments were part of the protocol they just hadn't been built because the sufficient technological resources weren't there in the 80s and 90s as the internet was getting going you know credit cards were still pretty janky technology and the web became highly centralized in the early 2000s you know web 2 created these walled Gardens of all of these different internet companies where they gave you these free services and you signed up and created and provisioned in your data but you couldn't easily Port from Twitter to Facebook to Instagram to others you were locked into these services and the the web 2 model is very much an app interface user data model where you are locked in and that's by Design so web 2 companies can create moats and store and own your data web3 is trying to change that where the app interface model flips so there's some protocols out in the world today like lens protocol The decentralized Social Network that lets you own control and sign your data via a private public key pair so if you get pissed off at Lens or if somebody builds a better front end for that protocol you can pull all of your Social graph all of your historical content all of your tweets from that lens protocol to whatever comes next because you own your own data and this is a fundamental ship it goes from internet companies owning and storing our data to us owning and storing our data and I want you to think about Bitcoin to blockchains as Google is to the Internet it's a specific implementation versus generalized infrastructure so Bitcoin the cryptocurrency is powered by Bitcoin the blockchain and we talked about how blockchains are far more interesting than just price and ethereum the blockchain is a smart contract platform there's a platform for smart contracts which are code not contracts and it's used by developers to build decentralized applications many cryptos are actually non-fungible tokens running on ethereum and require the native ethereum token to actually transact usdc is an erc20 token that runs on ethereum but it also runs on other blockchains so you can take your usdc token and move it to polygon to optimism to arbitrum to binance and that token has the same value on all of those Networks and openc is adapt that enables anyone to buy and sell nfts which are unique tokens on blockchain Networks and I firmly believe that technology shifts the culture just think about the world when the postal service was getting going and Benjamin Franklin innovated and created a postal Network that really galvanized the American economy in the 1700s then through to the telegram which changed how everything operated and created the market conditions for one of the first stock market booms and bus all the way through to early phone networks that changed how we communicated even through to the 90s oh I might be dating myself but I remember my parents yelling at me not to make long-distant phone calls or you know if you're on with your grandparents like don't stay on too long because that's an expensive phone call and think about how technology influences and shapes our culture all the way through to the early web and the iPhone and you know in the 17 1800s maybe you sent a letter or two a month how many text messages have you sent today or Snapchats or Instagrams or tweets the velocity of transaction or the velocity of communication has exploded because technology has enabled new paradigms and new ways of interaction and we're at the start of a new wave of transactions powered by blockchains today how many ACH payments do you do a month like maybe you pay your credit card bill maybe you pay your mortgage fee in ACH the last time I sent a wire took an hour on the phone yelling at a bank to figure it out but then you look at the world of blockchains and how transactions are becoming programmable and the velocity of transactions in the economy is going to explode over the next five years as crypto protocols move from the SMTP page where they're kind of esoteric and a little bit hard to use to the Gmail Apple iCloud stage where they're really easy and accessible to use and the number of transactions you'll do in your every single day will explode oh there as an aside a friend of mine works for a D5 protocol and he's paid in a real-time streaming manner so every second of every day his wallet is accruing more and more balance which is a dramatically different way to think than getting paychecks on the first and the 15th of every single month blockchains are transaction machines and they are a new technological innovation that's going to shift the culture and dramatically change the way we engage with each other and with the world and we're still developing the protocol we are still at the early stages there's some exciting Innovations like if you've heard people talk about account abstraction I believe that will be one of the big unlocks that helps onboard the next billion users into blockchain based systems but we're still very much in day one of this industry and we I believe have not really had the AOL moment that onboards the next 100 million billion people into this ecosystem let's talk a little bit about nfts who here owns one cool who here has a poet did anybody get any po apps today those are also a form of non-fungible token so eth is a fungible token one eighth is worth one eighth is worth one eighth and if I was going to trade you and eat you'd let me trade one eighth for one eighth because they're worth the same they're you non-unique digitally abundant uh divisible can be sent as fractional useful for currency Securities utilities nfts are non-fungible they're digitally scarce and they're not interchangeable crypto Punk number one is not worth the same as crypto Punk number 2997 and if I wanted to trade one for 2997 you'd look at me like I was crazy unless I was paying you an oodle of eth along with that and they're generally based upon the 721 standard although there are new non-fungible token standards that are coming online seemingly every month now what are the benefits they're scarce they're authentic they're they have a history of ownership so some nfts might be worth more only because you could see that at one point maybe vitalik owned that nft and it was in his wallet so there's maybe a little Mystique related to that they're transparent and there's revenue and royalty so every time I buy and sell an nft the original Creator is probably getting a cut down along the the way and Naval who's one of the biggest Giga brains in the space has this great tweet about nfts tokenize all things and we're going to move from a world where every protocol has a token to where every dap has a token to where every single representation of an object has a token but like what actually is an nft so we have crypto punks one of the most famous nft collections your house is an nft you wouldn't trade one house for another house the they're varied based upon the location based upon the number of bedrooms and you can actually buy and sell houses as nfts on Open Sea there's some for sale right now I'd even argue all of our identities are nfts and there's different projects that are looking to move non-fungible tokens into identity standards so we can more easily operate around this new decentralized world let's talk a minute about Dows is anyone a member of a dow cool so what what are the benefits there's share governance decision making finances incentives revenues and royalties and if you think about it firms corporations are just a Nexus of contracts and what do companies do all day long they tend to set up contracts set up agreements and Dows are a new form of engaging in decentralized world all automated by smart contracts and we're living at the start of the new era you can see as you walk around the conference this weekend that there are people who are living and breathing in this way there are people who represent themselves only as nfts there are people who only work for Dows and right now that's the minority of people in the world and the vast majority of people don't know what a Dao is don't know what an nft is but over the next five to ten years the world is going to shift from vastly off chain to vastly on chain just like it was kind of crazy in the 90s for like a restaurant or a coffee shop to have a website it's kind of crazy today for a restaurant or a coffee shop to accept eth but imagine a coffee shop not having a website today it's kind of like what the hell are you doing you're doing a disservice to your business in the coming years not having a blockchain enabled business will be a disservice as well and feel free to connect you can find me on Twitter or on telegram at ASU O'Connor um I'll be around afterwards if anyone has any questions thanks for the time today [Applause] foreign [Music]