The Future of Blockchain Protocols - TOKEN2049 London 2022

hello good afternoon um so I guess to to start by uh maybe spicing things up a little bit or just discussing I've always been fascinated actually by how do we differentiate ourselves amongst protocols and layer ones and so I did a little exercise before which is to take some tag lines from different websites of our panelists here and I'd like you guys to raise your hand if you think it's actually written on your website so a fast High throughput open source smart contract platform for digital assets and dapps who is that yes it's your good job we got that one right by faster test all right but now I can go yeah building a new future a highly performant open source blockchain platform built to support and operate safe compliant and predictable digital infrastructures who's that come on guys it's on your websites [Laughter] good um we aim to create the blockchain singularity in which every system and service is rebuilt and reimagine using smart contracts and runs entirely from infinite public blockchain without need of traditional I.T yes it's Dominic Divinity and last but not least but now you know highly scalable secure and decentralized blockchain network created to enable radically new applications for users businesses society and the new metaverse frontier okay so let's get real how do we get to mass adoption if that's how we described ourselves I'd love to hear from your perspective you know views on the future of protocols and how we can actually get to the method option that we think we will believe in do you want to start with you is sure um first of all I think it's a really good question because it's it's forward-facing right and it's really fitting with the theme and before this we were talking about kind of what obviously the events that are going on right now how that comes into play and one thing that stood out that a few of us mentioned is we're actually living in the future of the blockchain right now we're seeing it as it's happening and we're seeing events right now that are clearly impacting what will come tomorrow and what will come the next year and such but one thing that we kind of all came down to as well is that Tech side of things um and you had mentioned that a few years back and and or some of us you know we put the tech forward it's the fastest it's the highest throughput and such and that's something that combines everybody outside of that where's the future of block sign uh blockchain outside of that kind of where is the blockchain space going and Michael and I were talking about for example one thing that he brought up was Insurance layer uh just specific actual implementations or use cases that we believe at some point will become more inherent and start leveraging the blockchain stocks and that was another thing is this idea of a few years back a lot of blockchain developers were trying to implement solutions that currently exist in the space but more and more the future that I see are people out there web 2 developers it's it's traditional and Industry recognizing that blockchain can provide benefits and that Tech stack and the inherent properties of blockchain so it's they're now the ones leading the charge in terms of adopting the different protocols yeah and so that's where I see the future I see more of web 2 starting to see the advantages of web 3 and starting integrating it in in their stocks what's your view Michael on that yeah I think um when it comes to down to getting Mass adoption it's really about two things um it's really about the underlying technology and of the use cases right so when it comes down to the technology you know we're at the stage where I think blockchain technology across the different blockchains that are out there can handle probably like a few million dollars a few million users on a daily basis but you know the number of people who use play a single game out there is more than a few million right so right now the technology can't even handled like a few million users playing a game that are repeatedly sending transactions to the blockchain for you know confirming nfts as an example so I think on the one hand we need to have a lot more scalable technology out there and that's just like a matter of like hard work right you know there's different ideas out there in terms of improving consensus improving like what's known as middleware or the execution of small contracts or like execution um using say zero knowledge proofs now is like a big um discussion point so one is technology and I think you know it's technology will get more available and more efficient over time and that's just like naturally how technology works and number two is really like use cases as um as my friend mentioned like you know different use cases out there that are not just like you know not every use case needs to be on the blockchain but some there are some use of cases are really good for blockchain things like for example like uh gaming you know being able to create nfts to enhance the gaming experience things like p2v insurance which you can only really do when it's a publicly open source blockchain or even Supply Chain management and of course there's D5 as well so I think when there's more use cases um that use the blockchain technology and the technology gets more scalable that's how we get Mass adoption and it's also just a matter of time people are learning about it you know adoption always takes a bit of time yeah yeah because so far it's it's a lot about we could swap any of the protocols that are under and it would be still the same thing so I guess the maybe going but what's the difference between key protocols right so how do you how do you see that well it's a very good questions because actually adirond uh we just announced last week is uh transforming it is becoming Multiverse acts so basically we are no longer just a layer one uh blockchain we still gonna this is still our main focus so we are still let's say an infrastructure provider but now what we want to do is also build the next infrastructure and this is uh our vision that actually in the next few years and decades metaverse is going to be the next big thing and of course it's a kind of different metaverse that's uh uh there is out there in the sense that we want this kind of metaverse to inherit the same principles when we talk about web3 and blockchain so it's not a metaverse built by one company it's not actually the metaverse it's actually like worlds of Worlds a network of metaverses where anyone one can build their own thing they are interoperable and stuff like that and the idea here is that as blockchain we see blockchain as like the fabric of reality for us if you are to build a meaningful metaverse you need blockchain so for us men of us cannot exist without the blockchain because you need ownership because you need decentralization you did you need different kind of business models well not every let's say the network effects and all the benefits are captured in the center by a corporation for profit but basically you have all those benefits so for us this is a very different approach it's a it's not a rebranding it's more like a transformation an evolution and we believe by doing that actually is I I might say that the killer app of the blockchain is the metaverse and the killer app of the metaverse is presence and not necessary immersion or realist and this also can comes from a very interesting Insight is as web is device agnostic you can access it with from any kind of the device this is also our approach the metaverse or the Multiverse of these meta verses will we the way we want to build it is so that can be accessed without any kind of device although immersion VR IR are really really interesting and nice things that we at some point will want to integrate we say that this is not a precondition for for a metaverse so I guess this is a pretty pretty big use case and it's not something that's I don't know like D5 was the cool thing I don't know two years ago NFD was last year now it's something this is something that it's off for a very long time as I said the next few years and decades I think metaverse and of course blockchain as the fabric of this kind of reality are very very important okay well Dominic I'm curious so we are hearing a metaverse killer app uh presence we're hearing gamify we're hearing supply chain what would you what's your perspective on actually Mass adoption and how we get there so I think you know the the real challenge is a technical one and it's not one that many people are aware of in the industry today and today uh when people say they're building on a blockchain XYZ they don't mean they're building on blockchain XYZ they mean they mean they're building on the cloud right and then they just use the blockchain to store some tokens and nfts and um for me that's not what web3 is about okay um for me web3 really is about user ownership user involvement and things like that you know web one was read we just read content from web servers as in the 1990s 1996 1997 there was that website Hot or Not Right and now users could upload uh their own content to the internet for other users to read so that was Web Two that was about right so read write and web for his own and you know um I think web3 is obviously uh come out um with a bang and you know nfts were very popular and people were buying tokens to earn own art and things like that um but by really you know web through is a much more profound thing and really you need to be able to run something like Facebook on the blockchain under the control of a dow so you don't have a company and a CEO and you can give governance tokens in the Dow that controls the social network to the users and users can help with referring other users to make it grow more virally and help with talks like content moderation so that's our belief and you know the Divinity Foundation probably spent more time in r d than any other organization in the history of crypto you know we started offering in 2015 the main net came out and last year May 21 and the internet computer is a world computer and people are building this kind of thing on the um internet computer now uh you know social media services that Run 100 percent from the blockchain so um uh you know we've got even um you know Mass Market messaging services which are growing rapidly where smart contracts are processing individual chat messages and even the you know image and video chats people sent each other and these small contracts um process HTTP it's the only blockchain in the world where smart contracts can serve interactive web experiences so you can decentralize everything end to end um and it's not just limited either to um uh you know social media and things like that metaverse social fight game five whatever there's a huge range of things that benefit from Full decentralization running 100 on the blockchain um and for example if you go to my Twitter feed um I think a few hours ago I tweeted a link to a decentralized exchange that's under development that provides continuous double auction functionality I the same kind of functionality as FTX provides but it's you know running 100 on the blockchain the user experience is coming from the blockchain the order books on the blockchain the order matching's on the blockchain there's no Cloud involved um it's something that looks like FDX gives you the same functionality but it runs 100 of the blockchain um and it's in beta and those guys are going to assign control right and so it'll run under the control of the community and the community will push the updates you know to the small contracts so that kind of thing I mean look how many users you know centralized exchanges have enormous enormous numbers of users right well imagine you can tell a user hey rather than trusting somebody to look after your assets and putting it on a centralized Exchange why don't you use um this completely decentralized exchange that provides the same functionality so it's I don't think it's difficult I think it's a technology problem I think all blockchains have got to make efforts to pursue the world computer vision um and redesign themselves using Advanced cryptography so that they can host social networks right and then imagine with a social network imagine if you wanted to grow it's not enough just to provide the same functionality you're going to give users governance tokens so they own some of the social network so they refer their friends right and it grows virally you need teams of people to help with things like content moderation so you can only do that if you're running on the blockchain you can't do it if you're running on Amazon web services and you're just keeping a few tokens and nfts on the blockchain that's that doesn't work so um you know everyone has to move towards this well computer model and that's and how we get Mass adoption and we're already seeing it uh in in services that are running in that way now okay um you mentioned FTX actually so I think it's impossible to continue without actually mentioning what's happening um and so what we are trying all to unravel and make sense of uh as as we are living history live right so if I'm actually curious on your take what do you think are some of the big movements that we're going to see and how what's on your mind as we go through those moments we're already starting to see some of them um transparency is a big one that blockchain is able to provide right so we saw CZ this morning disclosing the assets on on the sheets of binance that type of thing um we've seen that what happened with xdx and it's still unfolding so a lot of it is speculation on what happened but were similar issues that uh were that occurred essentially in 2008 that led to the creation of in this industry uh as it exists today uh we're being replicated on FTX essentially and moving away from that we have the tools we we this is what this is built for and in some circumstances it's just not being used yet either because the tech isn't there or there's no will or for whatever reason doesn't really matter I think what we're seeing out of this is there's definitely going to be more regulation as whether we like it or not um there's definitely going to be a further I think a lack of trust that's going to come to those that don't that aren't let's say open facing and that aren't proactively giving out the information that technically they could provide and there's no real reason not to provide it and we're going to start to see a migration of users that are going to uh I think like kind of like what Dominique just mentioned go towards those that offer those solutions that are inherent to the blockchain and that you start leveraging because he's talking about a text he's talking about house users and I can interact with a Dao start seeing more use cases that are stemming from what this was originally built for and I think we're going to start seeing that relatively rapidly with what just happened and oftentimes an industry things move and the industry changes not because necessarily it was planned but because there's an event like this that we saw a few years back with kovid how now suddenly everything is all the ctOS in the world now just upgraded their Industries and it wasn't because they weren't in place beforehand it's basically their hand was played to them and I think we're about to see that now as well with what's happening currently so transparency increased regulation lack of trust on our entire industry are pushed for more decentralization going back to to what's original what else do you see Michael that um yeah first of all I just want to say that you know I'm very sorry to hear about like everything that's going on you know I I flew out of the Bahamas on Sunday and Monday this whole thing on unfolded and I heard like a whole bunch of stories from people not not just like um you know directly like at FDX but like people but also other people in the economy as a whole of the Bahamas because they were quite a big big part of the uh Bahamas economy and of course like there's a lot of stuff that's coming out there there's a lot of news that's coming out you know seemingly every hour so you know I can't really comment about like what I think is going on what I will say is that you know the Silver Lining to everything is that it it means that users are much more interested now in like transparency around the peripheral reserves of exchanges all right and so I think the regulation will be at least that that you know exchanges around the world will have to kind of like approve on a regular basis through you know transparency of the blockchain which is a big advantage of the blockchain combined with you know audits that are regularly done you know maybe like every six months or or whenever so people constantly know that their user funds are there and that like what the exchanges are telling them is is correct is accurate um that being said like I hope people don't accidentally conflate like what has happened with like oh that it's a problem with D5 in fact D5 is kind of the opposite right like D5 has a lot of transparency you can see all the transactions on chain on the public network and I think that's a great thing so I think people are going to like demand more transparency and I think that people we're going to realize that you know projects on the blockchain say with D5 or any other use case give you that additional level of transparency because you know the data is there is public anybody can see through it anybody can pass it and so you know you you won't be able to like kind of like you know say something is is there when it's not like recorded on the blockchain and I I think that's what is like very important okay Lucian what's your what's your take so I definitely transparency is definitely coming so something else yeah so I definitely agree with what was said before what I want to add here it's said that we have this Central centralized actors and uh we users don't demand those uh those actors to use the blockchain for especially for transparency but uh for example also there are so many other things that blockchain can help and these are actors in our space that don't use blockchain maybe at its full potential I don't know maybe it's kyc or other things that probably can be done so much better and definitely what happened in the last few days last few months and last year it's a very very strong use case for for all the others let's say non-custodial wallets D5 and uh and stuff like that and yeah that that would be from me so not a lot new here okay Dominic any any other views well I think the most important thing to know in all of this is um D5 has actually been remarkably robust in the face of all this volatility and we're not hearing about Ave breaking and things like that so um there's a lesson there right um all the problems that we tend to face um generally derived from centralization okay so whether that's three hours Capital being a Ponzi and losing you know Celsius and voyages money or um FDX I mean look I I've I don't trade crypto anymore but I you know I've been around long enough to I've lost money among a lot of money on bitfinex um you know so um clearly there's an issue with centralized um crypto um this isn't anything new sort of I mean history sort of repeats itself right in this field so um you know I think the message is pretty clear unfortunately we're going to need um you know uh centralized exchanges uh to be gateways to the Fiat system and um so we should just demand um that these centralized exchanges are very transparent and also lastly I think blockchain um you know it's got to be more careful about the leaders that it chooses and who it allows to become the face of crypto yeah I think you know uh there are a lot of people who are quite passive well Sam was presented as the JP Morgan of crypto right it didn't say anything um he was insolvent and knew it while he was pretending he could put three to Fifteen billion dollars into the Twitter acquisition and it was a confident scam he wanted to keep people's keep projecting strength so he could raise more money to keep this kind of Ponzi thing going um you know with respect to FDX specifically I mean um I don't know how many of you are familiar with this website cryptoleaks dot info anyone crypto leagues to info have you seen it all right because some people um but you know there's some concern that uh this thing called ICP perp was used to crash the ICP price when the internet computer launched and create this narrative that um there was something wrong with the project which by the way is has been for a long time blockchain's largest r d project we have um the largest team of top cryptographers in the world many things uh most things actually that blockchain now incorporates like BLS cryptography um the inventor works at Affinity web assembly virtual machine inventor works at dfinity um ethereum 2.0 very similar to early definitive design from 2015 early 2015. um but you know somehow this narrative was created and and the suspicion is that it was done to sort of uh clear the way for another blockchain which Sam and some others are invested in I don't know if it's true or not but you know crypto leaks was the first uh investor investigative journalism um outfit to have the courage to stand up and fire shot across the bows um of this guy but you know I think there's a problem here you know uh you know people with Integrity don't trade with customer funds they don't they just don't do it I bet CZ does will never do it right um and you know we seem to have as an industry repeatedly um put people into positions of power particularly in relation to centralized uh Finance centralized crypto who um may not have this value how much Integrity so I think that's another thing we need to be more decentralized we need to demand more transparency from the centralized on and off ramps that take people from Fiat to crypto and back but we also need to think long and hard about you know who we're choosing as leaders and who we allow yeah to represent us because don't forget for the outside world sambang and freed is the face of crypto and that means all of us are harmed by this yeah maybe bouncing actually on that I think you're using an excellent point around values and integrity and if we look at the world around us I think it's it's an absolute terminal and we were talking about that before on going on the panel it's not just you know our crypto world that feels like everything is falling it's you know war on on the European Soul it's like climate change it's just like you know values for for democracy and what it means and I think you're raising an excellent point which is actually values integrity and what are we building for the future and so Eve may be coming back to you how how do we think you know long term ultimately I think each and every one of us here is is to be those belief that we can create something that is better that will ultimately transform the world for for True Values how do you how do we stay true to that and how do we build that better world that's a really good question um it's something that I've been reflecting a lot on because I've been in this industry now for quite some time and when I first came into this industry it was shortly after 2008 it was very early adopter and I was definitely of the mindset that what was being created and what I was a part of was really going to completely overturn and change the current system and as I've been this in this industry longer I don't believe that's the case anymore I think where I think there's a certain recognition that needs to occur that where we are as a society today and the tech that we have and the way that the society you know consolidates with one another in democracy and such it's the best system that we have right now but that's evolved over time it's not all garbage there's some good in there and what blockchain comes and provides in my opinion is a level up it's not necessarily a complete redo it's not that everything is bad and magically everything is great with blockchain it's a new tool it's a new set of tools that we can use to better the lives of individuals to create more transparency more accountability in those that are in power those that represent us but I don't think that it's a complete do-over I think we and and we see that right now within our own industry we have very similar issues as we have the current traditional industry so how do we learn from that and which parts do we take in order to if the idea is that achieving something and getting that first 80 percent is relatively easy but then for every percentage after that it's incrementally hard maybe where we're at is I'm just throwing a number but let's say we're at 93 percent and getting that 94th percent that's what we're trying to achieve and it's just a little extra bonus but that means so much to certain people and in certain parts of the world it actually means a complete level up because some people are completely out of this and don't have any of them and now they're being brought into this system for them it really is a complete change I would assume that for the majority of us here it's it's an incremental value but that is so significant as a society as a whole and I think that that's what gets me to wake up in the morning it's that extra little I like that parallel not total redo which I think some of us got in for that but like more level up and therefore that level up can actually increase massively in others yeah significantly for sure right what's what's your take Michael um yeah I mean like economy is like similar to like my previous answer and that you know I think like there's good people and there's bad people in the world right you know and some people can do really bad things and but other people can do like good things right and I think like you know in terms of like um you know getting uh getting more users and and adding value uh you know to people I think it really comes down to like development a technology that ultimately solves like problems right and the problem is that we're trying to solve here is basically like increase transparency and Trust right or what is often termed like the trust of the system right and what we really mean by that is you know having code that kind of runs autonomously you know that comes to consensus via a majority of the individuals so not just like one individual or like you know a few individuals but like a majority of individuals in the network and that you know you have full transparency of their data so for example with like a civil application where you're swapping like one token to another I mean you you can see like all the data go in you can see it going out and you can interact with that small contract with the funds under your control right so you don't necessarily have to give like the funds to a third party but even if you give funds to a third party um on the Chain as a whole you know you always can see the data on the Chain being like okay where's my money you know is it you know in this wallet isn't that wallet did it actually go for the smart contract I wanted to go through and so even if you do like delegate work to a third party and obviously like you know people have the time to do everything that they want to do themselves you know you delegate right but you can delegate on the blockchain um to other people but you still have the benefit of the transparency of on chain right and that to me is what I think is like a real the real the most powerful use case um for blockchain technology I think you can see it in like different use cases that are coming um on board and I think as the technology gets better the amount of people being able to use blockchain technology is just going to increase over time okay and listen you were talking a lot about the metaverse and when you think again macro and the state of the world where we're in like what's your view of painting a world that is better thanks to to the metaverse I think everything starts with a choice you know you can choose what's what's what is how the world will look like how is the future and basically what we are doing is like living in the future and building what's not here right now and that that's why this is a choice and of course there will be challenges there will be people that will say well this is I don't know Escapist this is uh not a virtual reality this is not more reality or whatever that's why basically metaverse is an important part but it's not what we are doing that's why for example even in the name that the word there is so much power in words words can build worlds Multiverse the way we chose choose this name is basically giving enough space to have this let's say physical reality and have this also these other worlds and they are like they they can coexist without creating a conflict so it's not necessary only about the metaverse but coming back to to the choice of building something better and then like trying to imagine this future trying to live in the future and then come back and say okay what do we need and for us for example the funny thing is we we build the blockchain in the last four years that is there I said well for for that we need the blockchain we have it we we need D5 okay we we have defy then we need a portal between those worlds we we have for example a non-custodial wallet that now it's also evolving to a so-called explorer that is more than just a wallet is uh your avatar your identity and you start building all those things and you try not to get um distracted by by anything else and just laser focus on the future you want to build because you know what happened yesterday and stuff like that it's really really sad that I said it's sad because it's uh it's uh it's it's like I don't know uh a few years we'll need to work yeah we'll need to figure out what's happening just because now we give so much fuel for all the others that were against what blockchain is and all those values and really really amazing things that we can build but yeah this is life we have to you know keep building and Dominic so you talked a lot about decentralization integrity trust transparency I'm curious again thinking about the macro climate and the conditions we're in like what gives you hope in what you're seeing what you're seeing like applications or projects that you think are painting that better world well you know I've complete faith in web 3 and like I we're in some kind of analog to the um crash of um the.com bubble right now and um you know at the end of that I think Amazon's stock went down to three dollars Amazon was growing like crazy um and making profits and so on and yeah you know stock went to three dollars and now it's you know three thousand dollars um but I do think crypto needs a sort of cleansing and I think you know we're going to see some consolidation and and um we're going to see a lot of changes I think we're going to be in for kind of a bit of a gnarly ride to be honest um a lot of things are yet to come out um and people are going to find that um what they thought was one way it was actually another way and things like that but um you know if you ask me to predict where we're going to be in 10 years I'll tell you D5 is going to be bigger than uh traditional Finance um I tell you that um you know in five years uh only a minority of tech entrepreneurs are going to be creating companies they're going to be crediting dows and they're going to raise money I'm doing decentralization sales using tokens that's a bet for you um and that's a profound change I mean that's really really profound and by the way I mean to give you an idea of the potential here and this is what we're seeing you know the prevailing model has always been VC right Venture Capital uh tends to be concentrated in in Silicon Valley um you know Divinity raise money there you guys did obviously and um and even now a lot of blockchains you know raise a lot of money and and you know give money away to get people building on their chain and that's the prevailing model um I mean Sam was a great proponent Samuel great proponent of that obviously um but you know we believe in something different we believe in um uh Dows and uh decentralization sales funding people and that's just beginning to kick off right now in on the internet computer it's a very exciting time and I tell you why the reason is you know the traditional funding model is not democratic um only a minority of the talent out there can access it um you know I'm guilty as charged I lived in Palo Alto for 10 years um but I saw what it was like before because you know I was in London um and there's just this immense Talent around the world I mean there's a lot of talent in Europe by the way it's not easy to get a venture capital in Europe it's much easier in Silicon Valley um but you know there's this huge amount of talent around the world you go to China India and these guys um currently don't really have a seat at the tech economy right um but you know decentralized funding and Dao's is going to democratize access I mean we know um huge teams now working on the internet computer in China and they're just so immensely talented it's incredible um and this influx of talent which is enabled by the automation of um things like fundraising that democratizes access and I'm not talking about icos I'm talking about more sophisticated new models on the internet computer there's something called the service nervous system um where governance tokens are sold and the proceeds are held in the service nervous system down under the control of the community and so on um to prevent fraud but this is going to just drive absolutely immense growth it's talent that creates growth you've got to have the right platform the blockchain's got to be able to support true web 3 where you can have true autonomy so you can't get hacked you've got to get rid of the cloud you can't really have a web through service that's you know involves the cloud in any way or it won't be secure um so you've got to have the right blockchain platform of course um but in the end um it's developers they build um the experiences that are going to bring people into web3 and our view is that you democratize access by um pursuing the original crypto Vision you know where people um are able to raise money through the decentralized ecosystem and you democratize access and you allow for absolutely massive amounts of talent to come in and that's what already seeing and I think that's why web 3 is going to be hugely successful I think we'll go through a gnarly period it won't last that long I don't think it'll be like a year and a half two years Max it may even it may even be over sooner okay it's blockchain blockchain always bounces back right well on that we're very soon out of time but um so I think this has been enlightening in particular I hope you can take from here that uh we're not getting dathered and the builders and the True Believers of decentralization Integrity trust and transparency are here and the world we envision and what we actually want to build is still true to its vision and if anything yes times that are coming it might be tough and we don't know for how long but there is a real calling here for continuing to believe on the two wet three values the last point I was amazed on talent I think it's hugely important to have that vision and to have true diversity of thoughts diversity of actually Geographic components and really having something as participated from everyone in the world is actually going to be truly important so gentlemen thank you so much for your insights and input and let's keep building