A Tale of Two Wallets: Fighting the World of Closed Source Software with Tally - Carolyn Reckhow

hi everyone my name is carolyn reckow i'm head of biz dev at thesis which is the venture studio behind fold keeping tbtc saddle and our latest focus is tally the first community owned and operated web 3 wallet today i'm going to walk you through a saga that has been playing out in the web 3 metaverse since its inception now you may not be familiar with the entire narrative but you probably know some of these key players and you've definitely heard this decentralization yarn spun before this is a tale of two wallets so it was the best of times it was the worst of times here in the web 3 metaverse of 2022 we're seeing the crypto ecosystem shake out into two camps on one side on the far side over there we've got the community driven open bottom-up projects driven by brave anons and diverse idealistic crypto creatures and then on the other side we've got them the mega corps these are your large centralized institutional friendly crypto conglomerates benefiting from the monopolies made possible by their early mover advantage this tale shows us that in straying from their natural free and open habitats into the megatropolis of crypto conglomerates even clever foxes can transform into fat cats i'm going to talk to you about your wallets sure you know about wallets gateway to 3 necessary infrastructure but do you really know how your wallets operate behind the mask today's story illuminates an oft obscured centralization point in an otherwise decentralized web 3 project and reminds us that it takes a community committed to decentralization to actually realize decentralization so today we're moving towards a market that just two choices right metamask on one side a wallet owned by a centralized conglomerate and tally a truly decentralized community owned option at tally we're building the wallet the open internet deserves to us that means access over privilege open source over restrictive licensing and community control over centralized profiteering so why is tally the wallet the internet deserves and why are we so concerned about building decentralized systems anyway to us decentralization means community ownership individual agency and distributed value generation and this stands in contrast to the old familiar way that enterprises develop conglomerates um so i think conglomerates are almost like the perfect modern-day dickens villain archetype right they're corpulent self-serving growing always wanting more with very little regard for those around them they're all about limited user ownership private control over data and they function via rent seeking models and conglomerates means marketplace monopolies and if you need the econ 101 refresher monopolies are bad they're bad for users choice freedom all this stuff this is a chart here from eric posner and glenn wheels book radical markets where they're basically showing us that there are more and more monopolies in existence today uh and those monopolies are charging more and more than they ever have before all at the detriment of the little guys right the internet was built on the it deals of openness decentralization and collaboration but along the way the allure of advertising dollars distracted some of the best of us and any new open internet that we're building must be built with the centralized open source methods there's just absolutely no excuse for closing the doors on collaboration and returning to the parasitic rent-seeking business models of before but it wasn't always this way on the path to web 3. so how did we get here um taking a quick detour from the wallet story here going to do a brief history lesson on how we got here history of open finance and what we should take as a community from the enduring vision of an open internet uh starting with the grandfathers of open source software peer-to-peer technologies like bittorrent to the advent of bitcoin ethereum and the metaverse we know today uh all this stuff started with foss foss stands for free and open source software open source means faster development of new ideas free education for developers stronger security and enables anybody with talent and an internet connection to find and report bugs to jump in and contribute and work on governance foss was once considered really fringe but today there's no denying the enduring impact that it's had linux runs the majority of servers worldwide software development is completely powered by git and even the largest tech corporations have policies in place to support open source software and all of the decisions made in the early days of the internet to make software protocols browsers open source did incredible good for the world and laid the foundation for everything that we do in crypto today hopefully most of you guys know bitcoin and ethereum was built entirely on open source software one interesting parallel to today is early open source projects actually pioneered the template of collaboration and governance that dao strive to follow right now in a lot of ways you could even think of these open source projects as the first dows right this was just a bunch of strangers around the world coming together on the internet to build something new and just figure out how to govern themselves along the way next uh before the advent of bitcoin we saw another piece of technology pave the way for open culture on the internet bittorrent it brought books games music movies into the reach of any tech savvy kid and it made finding consuming remixing culture really easy um this rise of peer to peer uh file sharing tech was never about money it was always about access uh participation curation collection and today um it's really awesome we're seeing a rebirth of this remix culture in nfts you could say that nfts are kind of like the spiritual success or spiritual um predecessor right to ripping cds seeding torrents and you know curating your library peer-to-peer nft open market for culture turns consumption into collaboration and the community into like this super organism where everybody that is seeding culture is actually rewarded in the marketplace then satoshi stepped on the scene um i think you all know the gospel i will not get into it but i will give you a quick segment from thesis history that illustrates how important this is back in 2014 when paypal blocked payment processing for the thesis founder matt luongo's first startup which was a precursor to fold matt jumped into action and he quickly realized that the financial gatekeepers considered their business too risky and convincing any other payment processor to take a chance on them was going to take resources and connections like far beyond their means as a first-time founder so matt jumped into action researching alternatives and discovered bitcoin and then just a few days down the rabbit hole matt had prototyped his own payment processor built entirely on bitcoin boom done no meetings no phone calls legal agreements he didn't have to put on a suit and go convince somebody to take a chance on him uh it was just an incredibly empowering experience and um this first encounter with open finance and i think it's one that hopefully a lot of you can relate to and almost a decade later as ethereum is starting to deliver on its vision for an open trustless user-owned internet for all we're seeing open finance grow up today you can choose from an entire ecosystem of d5 projects you can trade and add liquidity on uniswap you can borrow and lend on ave you can manage risk on hajjic and though we're calling this latest generation of services d5 decentralization decentralization is actually just a means to an end the open permissionless finance is a catalyst for the expansive future of user-directed communities networks and the social and technical fabric of the internet itself and each new movement in this timeline has undermined traditional gatekeepers to unlock something greater resulting in open networks with permissionless access and censorship resistance consistently leading to new waves of innovation and user freedom and the economic incentives of d5 are accelerating this trend in 2020 the fair launch of yearn proved to be incredibly compelling right they radically rewarded their early users with real ownership and that vaulted yearn into the one of the most significant projects and probably one of the most significant communities in the entire dfi ecosystem and that's because tokens turn users into owners shared vision and shared ownership make for some of the most powerful communities ever every user fan advocate can be incentivized to grow and maintain their favorite projects and if we all succeed together we all win wagby um but all this open access and new models for ownership uh aren't really possible without a web 3 wallet which is where we zoom back in to the story here of a tale of two wallets metamask plays a huge role in the development of the early ethereum ecosystem the project started out aligned with the open source ethos of the space with the same uh values of our peer-to-peer foss forefathers um so metamask launched in 2016 they had this familiar browser ux that totally stood out amongst a sea of like these cryptographically obtuse products that nobody could use uh and the ethereum foundation i think gave them some early grants and they were quickly stewarded by a nascent consensus so consensus is actually where i got my start in crypto i was a early employee back in 2015 and i actually know the early metamask team really well aaron dan frankie all incredible humans and i worked alongside them with shared idealism as those early days unfolded and i've always been in such awe of what that team was able to accomplish and pave for the ethereum community in those early days we just we wouldn't be where we are today without metamask we never would have survived you know the ico boom of 2017 and 2018 and i think for that we're all really grateful but all centralized projects have their reckoning day this one landed on august 20th 2020. on this day metamask quietly scrapped its open mit license abandoning its commitment to free and open source software and then a few months later consensus launched metamask swap which is an in-browser dex that charges a fee a fee going directly to the consensus conglomerate not to wallet users and then a few months later we saw consensus announced a 65 million dollar raise from jpmorgan but let's take a look at what's going on with metaswap here how did consensus start to quietly take profit um so mediscop charges an enormous fee uh versus uniswamp sushi swab zero x and one inch uh this fee is as high as one percent per trade and unlike all of those platforms i just mentioned these tens of millions of dollars of fees that they're earning every month aren't going to users right instead they're going directly to a tightly held corporation consensus and you can see that we're not the only ones to notice our friend tom schmidt here dove into the chain last spring and showed us what's really going on and so you guys can see it's a lot of fees a lot of money coming in and despite years of community advocacy metamax users aren't seeing a dime from this and not to mention recent metamask releases have included a number of choices that are pretty much at odds with what's best for user sovereignty including blocking wallet access by country and increasing user surveillance these are product choices that are pretty standard for web 2 but in web 3 we can do better and we must do better and from that conviction tally was born august 20th 2020 the idea seeded and when consensus launched metaswap and started to suck up tens of millions in fees while no one was watching that's when the full vision took hold so as entrenched products move towards corporate capture tally poses an opportunity to deliver a wallet built on openness via its product culture and community it's time to build the community owned and operated web3 wallet and that means solving community problems as a community and when i say problems i'm talking about web 3 pain points um i'm going to come down to earth for a minute from all that crypto idealism and talk about the day-to-day plights of a defy user right greeting the fox with your morning coffee clicking connect about that actual experience of using metamask i don't have to say much more i think we all have our pain points and user experience frustrations we know a lot needs to be better and we're seeing the market move much faster than the product and sadly user experience is on the chopping block and so that's how we started with tally asking our friends what would it look like if um a web3 wallet met your needs today and they told us a lot of stuff but i think the most interesting point is that nobody had asked them this question uh you know and if they had ever you know shouted into the abyss for feature requests nobody had listened um and so yeah so these are some of um the the questions guiding the product vision what if your wallet works seamlessly in defy uh what if your ledger support worked as an advertised it might look something like this uh so the first wallet release is going to focus on open finance and will work its way across today's defy ecosystem anywhere you can use metamask today to swap farm blend borrow you'll be able to do that with tally and tally's launch is also going to open up a number of yield opportunities integrating tightly with yearn and other aggregators to make earning passive yield as easy as opening a savings account and instead of enriching a select few all fees generated by the wallet will go to users bootstrapping a robust community so come build with us we've opened so to our code already we've had four audits and are engaging in a fifth um and at the end of the year in december we launched a limited alpha edition available for our community on discord and we called it the community edition you guys can jump in and follow that link download the chrome extension um and try it out tell us what you think jump in our discord we just launched swaps um so you can try it out yourself and i'm gonna brag about the community for a second this is really our the greatest asset um since we opened up the discord in in august uh we've already hit 11 000 people and um they're pretty active every week on friday we have a community call and usually we get about like 500 people every single week and the community is taking on more and more project functions for example we just launched the partnerships pack and these are community members that are reaching out to projects and forging all the partners partnerships and integrations with d5 projects like we're only in this alpha and we're already live with a whole bunch of dapps like yearn and uh synthetics saddle also we've been pushing forward with our support of public goods and open source software you may have seen that we sponsored ethers.js for all of 2022 and yesterday we just announced our partnership with git coin's new aqueduct program and 2.5 of our supply we're going to propose that that goes to public goods funding and tally grants so yeah we're pumped to be here at east denver come find us and get yourself a tally eat denver po-op trust me you're going to want this you can find us in the shill zone you can also go hang out with live puppies at puppy playtime in the zen zone happening right now and all tomorrow afternoon um and lastly yep if you're hacking check out our bounties we've got money for anybody that just you know integrates tally as a wallet with their project but we really want to see people hack on some new features like nfts wallet connect multi-network support and we're also really interested in seeing what you guys can contribute to the larger ecosystem uh so yeah tally is aiming for a dow launch before the end of the quarter so make sure that you're keeping one paw in our discord for all the latest and this is how to do that we are at chat.

tally.cash that's our discord um thanks everybody carolyn recall my twitter and telegram you can find me and uh thanks for having me denver [Applause]