Stop Building the Dystopia | Evan Marshall - Demox Labs, Leo Wallet

Hi everyone. Um my name is Evan and today I wanted to talk about stop building the dystopia. A little bit about me first to get started. I'm the CTO and co-founder of Dmox Labs. I'm also a Z prize architect.

I work exclusively with programmable privacy through ZK. Um we work with Aleo, Polygon Miden, and Aztec. Our largest product is called the Leo wallet. Um we have more than 250k weekly active users, but we do everything from building full products to uh acceleration on WebGPU, um building infrastructure. Our our kind of whole goal is to make pri- uh programmable privacy a reality.

So, the the first thing I kind of want to talk about is what is really like if we imagine that we stop using credit cards and we stop using like Chase and Bank of America, what does the world actually look like? Well, the first thing is once you're doxed once, everything you do is public forever. The only acceptable way right now to get privacy is through centralized exchanges and custodians. Basically, you can use Coinbase as a mixer. Uh this is this is bad.

Um if you put open-source privacy-preserving code on chain like Tornado Cash, you go to jail. And something I really want to kind of emphasize is uh people who tout Web3 as a solution for the unbanked, well, most of those unbanked people do not live in the the most democratic government with the the best representation. How long is it before uh some government who doesn't treat their people super well pays Chainalysis uh to help give a list of of who the users are? So, what I really want to do with this talk is is reframe privacy. Privacy is not just about it's the right thing to do.

It's not just protecting fundamental rights. Fundamentally, it's it's inevitable. It's economically productive. It's going to make things cheaper, faster, and better. So, to kind of understand the the history of privacy, we have to look at the internet before privacy uh when we had HTTP.

Basically, the internet before the introduction of SSL by Netscape in 1995 was not a system that could be used for anything meaningful. You couldn't have e-commerce, you couldn't have things like social media, all sorts of financial online activities did not exist on the internet before we had widespread adoption of encryption. Uh network systems without privacy, you have all sorts of like man-in-the-middle attacks, um just pure data theft, right? These sorts of things like the internet only really became useful once we started integrating privacy. And it's kind of crazy now that we don't really even think of SSL or TLS or now quick as privacy technologies.

It's just how the internet works and we really can't imagine going back. Um by basically like encryption is expensive and before before encryption was widespread, it was actually expensive to encrypt the whole internet. And this was a big barrier. But what we ended up seeing is that by reducing the amount of trust on the infrastructure that powers the internet, like you don't have to trust every computer in this decentralized system, um you actually get way more economic productivity from the internet. So, encryption is never free.

It's expensive it's always going to be more expensive than plain text, but we have to weigh it against the economic benefits. So, that's why I'm really excited about enhancing blockchains with zero-knowledge proofs. Uh kind of my view on TEEs, I'm happy to give that is if you want to talk to me later, but there is a reason I focus exclusively on zero-knowledge proofs. Especially with the introduction of different ZK-VMs, especially those that preserve privacy, things like SnarkVM, things like Noir, uh or Brettenburg, uh Polygon Miden, there's a lot of different approaches to privacy that I'm really excited about. And most importantly, ZKPs are really just a fundamental advancement in in encryption.

And we can kind of see that as the cost come down, we will uh be able to realize the economic benefits of using ZKPs more and more, especially around things like identity. The way that we manage identity right now on the internet, like forgetting Web3, is insane. Um age verification is an absolute joke. Uh it your identity is probably worth about two or three dollars on the dark web. This is your social security number, every address you've ever lived with, uh your family's addresses.

It it it identity on the internet is really kind of a a joke and it's insane how much manual uh processes we have to build around identity and how expensive this is and frustrating this is as a user to be able to to kind of deal with these problems. So, I'm really excited about ZKPs in terms of identity. But I I don't want to totally discount public blockchains. Um this is ETHDenver. I do really, you know, we work with L2s on Ethereum, but uh public blockchains are all about decentralizing financial power away from nation-states and giving it back to individuals.

But right now I I do really think we have to accept that it is a toy technology. Um banks, large institutions, governments, they don't take blockchain seriously. And having everyone take like we're still kind of pre uh you know, uh internet bubble, I'd say with the technology because people are excited about the future of blockchain, no one is super excited about the present. So, another thing I kind of want to reframe privacy. Not only is it economically productive, but it's not going to start with individuals.

I think a really big misconception is that like and sometimes I say, you know, we're building tools like private Venmo, um businesses and governments are going to be the primary drivers of privacy technology. The same way that they were the primary drivers of internet technology. Uh I just want to give you a quick ex- quick example. Um who here actually uses Signal more than Telegram? Just quick show of hands.

All right, we got like three out of 40, 50? Right? That's not great. Um it's going to be really tricky to force individuals to new technologies because individuals, they want convenience. They want uh speed, they want a nice UX.

There are all these things that we have to do for individuals. So, I can't get my mom to use Signal. Uh no matter what I do, no matter how many times I tell her about the benefits, I promise her it's not related to crypto, that it's just a privacy technology, my mom isn't going to use Signal. She's going to use iMessage cuz it's the thing that works really conveniently and it's integrated, you know, across her iPad, her her MacBook, her phone. Um it's going to be really difficult to get individuals to use privacy technology.

Everyone at my company uses Signal. Why? Because I don't talk to them if they don't use Signal. This is the difference between businesses and governments where if a business sees a benefit in using a certain technology, businesses can mandate adoption and businesses are going to be much more rational about the economic benefits of a technology and much faster to adopt it. And and governments as well.

Um The leader in cryptography is is some government. Probably the US government, I hope, but it's definitely a So, in terms like why why are businesses going to use privacy in blockchains? Well, I I think a really kind of important understanding is that right now, every service that a business uses exposes all of their data to that service, which is is not great for the business, right? If you use, for example, uh payroll system, you have three or four different companies who have all of the data about how much you pay employees and who knows if they're selling that data. There was actually a case with Carta who manages uh cap tables for startups.

So, investors and employees would would manage their equity um with a startup through this platform. And Carta then started reaching out to investors uh sell saying, "Hey, do you want to buy secondaries in this other company that's like the one you invested in?" Um so, businesses obviously kind of revolted against that. So, you're now going to be able to build services where businesses and individuals using you don't have to trust you. You simply provide like there's this trust assumption built into all software right now that we can start removing.

And I I do want to clarify, too. I don't I don't think like ZKPs are the end-all. I'm really excited about FHE and encryption pretty much keeps going until we get program indistinguishability. But uh that that's a talk for another time. But I you know, ZKPs and FHE uh aren't the only technologies, but they're ones that are really useful for uh decentralized systems.

So, that's why we talk about them a lot. Governments, too, are really weird. I think a lot of people in crypto, especially those who work with privacy technologies, um are worried about regulation. They're worried about kind of regulation by enforcement because rules are not well articulated of what you can and can't do. So, I I I think there's a little paradox there where governments are also the first movers to adopt new privacy technology.

Uh the government, like I think it was the Navy invented Tor. Um the NIST handles all of the standards for encryption. Uh there was a recent competition to handle like Falcon 12 signatures, which are uh quantum-proof signatures. They're the ones kind of leading the way for the path of general cryptography. And governments want privacy.

Uh something that's kind of ridiculous to me and and something that no one really seems to be focused on is privacy for like how governments pay contractors. Right? So, it's sort of insane that the whole banking system sits between the government and how much we pay like Boeing to make secret fighter jets for us, right? I I very much believe that if a government had a peer-to-peer way to pay contractors privately and without any additional information being leaked to any external parties, governments would would really want to use this sort of technology. I think that there's a a giant misconception that governments are against cryptography.

Uh governments just want it for themselves. Right? But that's why we build open-source software so that as we develop these technologies, um governments who will be kind of the first to test and battle-harden them are also we're we're not kind of closing individuals off because ultimately, cryptography is applied math and it's really hard to restrict the usage of applied math to any particular group. So, I I really kind of like to to refocus the talk. This is this is kind of nearing the end.

Public blockchains right now, at best, are going to be a toy. They're going to be fun to play with. Maybe we can gamble and speculate. Maybe we can experiment with like new forms of building organizations and incentives, but they're going to be a toy. And at worst, if you if we think if you think about like actually adopting this technology where every purchase you make is public, every time you receive a paycheck, it's public, every time uh uh a parent gives their child their allowance, it's public, it's literally the most dystopian technology imaginable.

And building privacy, it you know, I I just don't even think it'll happen, right? I I don't think the adoption of this technology, which is fundamentally about dis you know, removing governments and nation-states from controlling monetary supply, it's just not going to happen. And privacy gets us there because it's not just morally right. I mean, I think intuitively, we all if you're at this sort of event, you you probably agree that privacy is important to protect. But do you use a VPN every single time you, you know, use Chrome?

Or do you use the Tor browser? Like probably not, right? It but the economic efficiency, reducing the trust requirements because trust is really expensive, is going to drive business and government adoption. And the business and government adoption is really important because I think a lot of us, we try to build, you know, experiences for individuals. We're not focused enough on building private payroll for businesses or private cap table management.

These sorts of solutions that are economically productive and valuable to corporations. This is where we should really be focusing our effort. Uh to get back to the main event, um we are sponsoring a $4,500 prize that is going to the best use case of privacy in DeFi. Um we're we're calling it ZKFi, but I I it's not in my job description to name things. So, uh we're building it on Aleo using the Leo wallet.

Um if you have any questions, if you want to learn more about everything from where proof generation acceleration is at to how do we actually build consumer-grade products that hundreds of thousands of people use that integrate these privacy technologies, feel free to reach out to me. This is a QR code to the bounty. Um I got a few extra minutes, so if anyone has questions, uh there are no mics, so you have to scream really loud. But thank you for joining me. Really appreciate it.