Vitalik Buterin and Joe Lubin – What will 2020 mean for Ethereum?

Please welcome Joe and Vitalik to the stage. Hello. Hello. How are you guys? Very good.

I am also very good. What a coincidence. Well, this is going to be a lot of fun. So, I have a few questions... a lot of these things are about the history of your first meeting and the Ethereum project, we'll also talk about some controversial things at the end , but for starters: How did you two first meet and what was the history of your involvement with the Ethereum Foundation and the project?

Yes, so I grew up in a northern region called Canada. Just like Vitalik. And I regularly went back home to visit my family during the Christmas holidays. And at that time I was living in Jamaica. I had already been paying close attention to Bitcoin for several years.

I was reading articles by very clear explainers of this technology in something called Bitcoin Magazine. And later I realized that this was actually a very young person from whom I was learning a lot. There was something called the Bitcoin Foundation that seemed a little suspicious. And then there was another Bitcoin group up north. I forgot what that was, Anthony.

Bitcoin Alliance of Canada. Bitcoin Alliance of Canada. So there was guy in Canada named Anthony Deoro who was working at the grassroots level. I became an expert in technology by studying all the time. But I was n't part of the community.

When I went to visit my family , I called Anthony and we talked, he said, " he said, " By the way, there's a guy named Vitalik." He has written a white paper that people are excited about and we are going to have a meetup. I think it was January 1, 2014. Why do n't you come and see it ? I talked to Vitalik about this for a few minutes.

Vitalik said he would send me the white paper. I read the white paper that night and it was a very energetic meetup. It was a place called D'Central in downtown Toronto where Anthony ran around. And for the next few days and weeks, there was a lot of activity on Skype and people were getting together for a project , and Anthony had rented a place in Miami. Before the North American Bitcoin Conference , where Vitalik was scheduled to present a paper describing the Ethereum platform.

Do you remember all this? Yes. No, the meetup was great. And between that meeting and the North American Bitcoin Conference, there was a lot of activity on Skype and Meetup. And so was it just the two of you or the whole team globally.

Yes, that's great. that's great. If I'm not wrong, I think this is the first time you've been together in London since Defcon 1 in 2015. What are some of your special memories of that event ? Do you remember anything?

There were so many amazing moments there. I would like to know what DevCon 1 was like four years ago. And it was the Ethereum community's biggest event to that point. More than 300 people gathered for a week in a large hall in central London. A magnificently decorated hall.

Much more decorative than this. more decorative than this. It was very special. Yes, there was a lot of excitement all around. was a lot of excitement all around.

This was also the time when some of Microsoft's stuff was first announced and since then Microsoft has done a lot for the Ethereum ecosystem. Yes, it seemed like a great start. Yes. I remember we were a small community that talked on Skype , and were doing something that had a lot of power and that attracted a lot of people. That event was first scheduled , then canceled, and then rescheduled.

And it turned out to be a turning point in our ecosystem because we all got there and were so happy that so many people were there. It infused a lot of energy and momentum into our ecosystem. Another really remarkable thing that I think we all started to feel in a sort of discussion on Thursday was that in the main room or in the back we were all talking and then everyone realized at the same time that no one had talked about the price of Ether in 4 days. And so it was very clear that this was a group of builders, developers, etc. And so that's exactly why these events are so great because people care more about building specifically and it's always exciting to see that.

No, this is so wonderful. Vitalik, you are with the Ethereum Foundation. Joe, you you lead the consensus. I wanted to ask this question to each of you. Vitalik, what do you think Consensus does better than the Ethereum Foundation ?

And similarly, Joe, what do you think the Foundation does better than Consensus ? I think enterprise outreach is a big thing, and Consensus has brought Microsoft and a lot of other companies into the Ethereum ecosystem, and they're definitely starting to contribute more and more , and that's something that I definitely think the Ethereum Foundation does n't do as well. Initially, Consensus was largely focused on continuing the vision and mission of the Ethereum project. And we had license to do whatever we wanted. The Foundation is a special organization.

It needs to be an impartial custodian of the ecosystem. It's a kind of focal point for some things in our ecosystem. Consensus could do crazy experiments and have amazing marketing events and so on. We were a little concerned about statements or our image, but we had the freedom to explore but we had the freedom to explore different paths and make a lot of noise , and in my opinion we need a very strong foundation. I like the minimalist approach, but I also think we need a clear voice that is the center or protector of our ecosystem and I think we play quite complementary roles.

Maybe I'd like to know a little more about this. What would you say is the role of the foundation at this time and how do you think about what your priorities are as a project? I think generally I support things that are valuable and very important to the ecosystem, that do n't have the means to fund or support themselves. Historically, this has involved a lot of research, client development, and outreach. And over time, the way the foundation carries out these tasks has naturally changed.

For example, in the past two and a half years, there has been a huge increase in the use of grants by the Foundation. But I think in general our goals are still the same. This seems absolutely correct. We are in London today. There are approximately 300 people present at this event.

Many of them are working on new projects , ranging from Ethereum 2.0 to DeFi. I want to know what you think about the UK Ethereum and Web3 community? Are there any projects you are excited about? What is your opinion on the developments taking place in this country and region, from regulation to developer interest?

What are your general thoughts about this space? The UK has always been a major hub for the Ethereum community. Even in the beginning, we had a large communications team here, and a large part of Solock was also formed from here. Aztec is doing very well these days. There are many other companies, such as Grammatics, that are working at the enterprise level , and many other smaller projects.

Yes. ConsenSys has a large office here. The educational environment here is very strong. There are many cryptographers here. We have several projects that focus on both enterprise and mainnet.

There are Apex 3, data analytics and trading platforms. There are projects like Adhara, Tristology and DrumG. They are a little more enterprise- enterprise- oriented. Yes. Aztec Protocol is very impressive, working for both enterprise and mainnet simultaneously.

I think this goes back to what Vitalik said. Stefan Twall did a fantastic job , he brought together a lot of people and laid a very strong foundation for the Ethereum community through a meetup list. No, the Ethereum London Meetup Group is still one of the largest meetup groups in the world. Yes, that's absolutely true. Talking about this topic.

I think the word 'enterprise' is taken negatively or with less enthusiasm , but I don't think that's the case. But I really want to understand: How do you see the enterprise world evolving over time on blockchain and specifically Ethereum? And you both made comments about the mainnet and enterprise eventually becoming one. And over time, how do you see it going forward , or what do you see it becoming like? Yes.

I think the word ' enterprise' has enterprise' has an old negative connotation among some people , because they think "these are centralized people, they're coming , they'll use private blockchains. " But in reality, I think enterprises have played a helpful and complementary role in the Ethereum ecosystem. Like Ernst & Young created Nightfall, and it's been open sourced , and there are also examples like Grammarly, and sometimes these projects are on private and consortium chains. Even if they do , the beauty of the Ethereum ecosystem is that most of the work can be easily transferred to the public ecosystem. And also, enterprise activity on the mainnet is growing, as people are understanding that the public blockchain is a reliable thing that is here to stay.

So I feel like young people need to find their own way. They need to prove themselves different. As they mature , they first separate from their background and then they combine new good things with the old things that society has discovered over the centuries. I think ecosystems are like that too. If you look at the internet ecosystem, that too was a group of many revolutionaries.

Who created different protocols and wanted to change the way the world works. And many people in the enterprise liked the things they created and they started using SMTP, HTTP and HTML etc. in a limited environment within the Internet. They've all effectively merged into ventures or new types of ventures, or you know, new companies that these young people have created that have actually become established , so I think we'll see a similar pattern here. I don't know if Coinbase is a venture right now, in a sense they are, and so we see the technology joining the mainstream soon.

We see that private official networks will continue to exist. I like the concept of decentralization sufficient for the use case , where it is sufficient. I also expect that many of the authorized systems, which already exist, will probably move to the mainnet or some layer 2 or some layer 2 that connects to the mainnet. And so, let's basically look at how you define going to a public blockchain ? Is it just relying on them as a central source or if you create a logical structure for your system , it can sit on a disconnected private official version of Ethereum technology, or it can be moved to a different version , if privacy, scalability and usability are well addressed , there is no reason why you can't bring a system to the mainnet.

We anticipate that many private networks will connect to each other. The Congo Commodity Trade Finance Network is doing this with the Commodity Trade Network. We are already seeing connections from these private systems to the mainnet , just to pin down the situation for anti- , just to pin down the situation for anti- collusion purposes. We see that most of the enterprises or many of the enterprises that we talk to , some of the largest enterprises in the world, are getting serious about tokens, bonds and many other uses , and anything with real value needs to be on a more and more decentralized platform. You may want to move it to another platform for various reasons.

But if you try to put something of real value on a less decentralized platform , it will be attacked. This will not be a viable solution for the financial world moving forward. We have a project, which we are going to announce on March 4th , with two of the largest companies in the world, that is focused on creating a system that takes personal information and processes from private chains or data stores, and connects information between different parties using zero-knowledge techniques. I think this will be run from within the Enterprise Ethereum Mainnet Working Group. I believe this will be a major revolution in the way businesses use the mainnet.

Next week. This is very interesting. It's a matter of a few days. This is great. My question was, when do you see this happening ?

And you have already answered. So. A few days, very soon. This is how we are bringing a supply chain POC that will introduce a new protocol. Very good.

Malik, that's my name, Mr. Berin. Um, that's my name too , Dr. Buterin. Oh my God.

What is ETH 2.0 and can you give us an update on its development? Of course. ETH 2.0 is a set of very significant upgrades to the Ethereum blockchain that have been researched and will be implemented over the past few years.

And this will change in the next few years. And can you highlight its main parts? Yes. Its two biggest components are proof-of-stake and sharding. Proof-of- stake is a new consensus algorithm that replaces proof-of-work mining , and sharding is a scalability technique that allows much more transactions to come on the chain because each node does not need to verify all transactions.

The current situation is that this upgrade is divided into several phases. Phase zero creates a proof-of-stake chain, phase one adds basic sharding, and then this is followed by a proposal for a merger of the two systems. And then there will be some other upgrades that will increase the computing capacity of shard chains , and phase zero is very close to launch. This is very close to multi-client test nets; It has already had single client test nets for quite some time. It has already gone through a few rounds of security auditing and client optimization and has a few more rounds to go.

That rounds to go. That , in general I'm quite optimistic that this will become a real thing very soon and from there the network will become more sharded and we will have a lot more scalability. Can you quantify these improvements in terms of what scalability means here? Compared to the current situation? Yes, of course.

I think we're estimating that with sharding alone it could increase by 100 to a few hundred times. Yes, transactions per second. Yes, going up from the current figures which are 10 to 40, it depends on the type of transaction. Yes, but of course if people use rollups on top of sharding it can multiply even more. Okay, we'll get to that soon.

This is great. Hey, can I talk to you ? One thing I'm excited about is that unlike the x86 upgrade life cycle. It was a brand new design space. So this is a new network.

This would be a fundamentally much better solution that is not bound by past events. But from the beginning the two networks will be essentially connected. And so there will be a very smooth integration and evolution from Ethereum 1. That was actually my next question about the hope for Ethereum. Yes.

So, in terms of moving tokens from one chain to another, staking on a chain, using data, building back bridges, and finalizing blocks. So there will be this synergy between the two that will make it feel like a system , but over time it will slowly evolve into a much better system. No, that's great. And this will happen in the next few years or after Phase 1. Yes.

Very good. We talked about things that you both generally have the same opinion on. I want to ask what is it that you, Joe, disagree with Vitalik on and Vitalik, you disagree with Joe on ? Yes. So, we were discussing this a little bit earlier.

And we were having trouble finding anything. I usually agree with Vitalik because he is very smart and we are quite philosophically aligned. One topic that came to my mind was on-chain governance. on-chain governance. I remember several meetings in the first year where we talked hopefully about how we could get rid of the Foundation and replace it with a set of smart contracts and we just needed to get to the point where we had the functionality we needed so that we could do on-chain voting about the protocol.

etc. I would describe myself as somewhere between Vlad and Gavin Wood on this issue. Oh, I also live between the North Pole and the South Pole. What a coincidence. Absolutely.

And Vitalik is also between the two of them. I think we are all very close to Vlad or we are both very close to Vlad. So I think I heard Vitalik say that he does n't think there should be on-chain governance. And I think we should try to move some governance on- governance on- chain, some voting systems, etc. So I don't know if that's still true if we can intelligently build the necessary infrastructure over time so that we can start making decisions in that kind of context.

No, I think that's right. This is no fun. We are not very good at coming up with new ideas. I'm still waiting for his response. Yes.

No, and unfortunately, I can't really think of anything else about it. Everything is fine. And. A lot has happened in this area, from what we initially saw as what the DApp ecosystem would do to where DeFi is today. Out of curiosity, having been a part of ConsenSys and watching it evolve over the past few years , what would you say, Joe?

Just some lessons learned about how DeFi is evolving and where you think people should pay attention in this area , such as projects working on DeFi , from regulation to its development side , which they might not be aware of as newcomers to the field. So the ICO phenomenon was wonderful but also problematic in some ways. We started a project called 'TRU Set' to solve some of the problems, which was designed to collect information from the ecosystem. The purpose was to obtain information about different protocols, new ICOs, the identities of real people, and the total number of tokens. We are trying to rate the parameters of 'Money Lego' through another project called 'DeFi Score'.

DeFi is truly amazing. I think Ethereum and some other decentralized protocols are a new foundation of trust for the planet. On this new foundation, we need to build a financial structure and DeFi, that is, open decentralized finance, is doing just that. We have a wide range of protocols, from prediction markets to insurance, decentralized exchanges, derivatives, synthetics, licensing, payments and automated portfolio management. This is very surprising.

Once we get it working properly , it will attract new and old businesses from around the world and become a decentralized global economy. This layer needs innovation, but we also have to be careful what regulators are thinking, because they are now looking at everything very seriously. Many projects are funded by VCs. So they have to figure out how to maintain a balance between innovation and a regulated environment. And Consensus is quite good at it.

We have a lot of lawyers who spend a lot of time in Washington. So we test all our ideas through that group. Very good. DeFi is a hot topic these days. What else are you excited or hopeful about in the next year regarding the growth of the Ethereum ecosystem?

One is increased privacy. We are seeing examples like 'Tornado Cash' and I hope we will soon see even better options. And that's something that the Ethereum ecosystem is really starting to feel the need for , especially as we have a lot of things like ENS coming out and we have even richer types of transactions , and I think there's a growing understanding that not all of your activity should be publicly interconnected. So that's one thing. Another thing is security.

And there are different types of security. For example, we started thinking a lot more about smart contract security after the DAO. And I mean, so far it's proven to be quite effective. And we have seen far fewer bad events recently than before. Except for the recent flash loan incidents.

But user account security is also an important aspect. I have been a consistent supporter of things like smart contract wallets, multi-sig social recovery and we have seen tools like Argent and Gas Station Network that make these things convenient. And there has been a lot of interest in smart contract wallets. So it's been good and I hope to see more like this. Also, exchanges are another big example.

That's why non- why non- custodial exchanges are becoming more popular. Uniswap was obviously the first to be fully decentralized , but recently Loopring has launched based on zk rollup. You have the feature that if the server misbehaves or disappears , they can't do anything wrong and users can still withdraw all their money, which is great. This is something I hope all exchanges adopt exchanges adopt in the medium term. And if they do that, we will see a significant reduction in the number of major incidents of losing funds.

Yes. User experience and all other aspects are improving. I think we will see continued improvements in the ecosystem and an increase in people's ability to use Ethereum. There is a lot to be excited about here. I will talk about two points.

One is that I should stop calling them enterprises , maybe call them non- non- blockchain native companies. I expect that many large and medium-sized companies will be very excited to bring a significant portion of their business to the public mainnet. Um, the second part is a little more complicated. Um, we have a lot of people at Consensus working on different Ethereum 2 projects. Um, the Quilt team is working on phase two and we also have a designer who has some expertise in developer experience, so to explain what the developer experience on Ethereum 2 will be like and what some of the initial execution environments might be like.

I'm expecting to see some interesting releases on this in the third or fourth quarter of this year. There are so many things to be excited about and I think the best part of it is that so many of these things are interconnected. Um, you get a pretty fast pace in terms of development and you can expect a lot to happen in just a few months. Um, the next section I want to cover is what we call ' underrated- underrated- overrated' overrated' , and it will work like this: I'll have a topic. Each of you will have to say whether it is underrated or overrated, and explain why in a line or two.

Um, you can answer however you want , and we'll start with public goods funding. I think we've talked about this a lot , but maybe it's still underrated. I don't know. Public goods are important, man. Um, so underrated, I think we have mechanisms that can greatly enhance this, as we've seen on Gitcoin, and that can identify external influences and bring them into the scope of the calculation.

This is very good. I like concise answers. Um, ZK roll Um, ZK roll -ups, I think they're underrated. Um, I mean , I like roll- , I like roll- ups in general and we've seen a lot of hype about optimistic roll-ups in the last month , where teams like Arbitrum and Optimism are doing really well. Um Um , but the , but the thing about ZK roll-ups is that they have some advantages, like you don't have to rely on fraud proofs , and instead you just rely on ZK snarks to prove validity immediately.

And especially in the last few weeks, there have been some quiet but very significant improvements in the ability to quickly verify zero-knowledge proofs and more general types of calculations. Um, so the general problem with ZK roll-ups is that historically historically , even for specific applications, I remember Looping giving figures that, their transaction cost was 0.3 cents for on-chain data and 0.3 cents for proofing time. And recently, they have optimized that proving time more than tenfold.

And, for general- purpose computing, which is very expensive now, and as I mentioned, there are a number of quiet improvements happening in the pipeline that will bring us closer to a general-purpose virtual machine that you can do zero-knowledge proofs on. So overall I'm pretty excited. Yes. So underrated...will be more awesome, more universal, more immediate, more widespread.

It will take time to complete all this. ProgPoW. I have better suggestion for Ethereum governance. better suggestion for Ethereum governance. How about if Joe and I box on stage and if Joe wins, the Progpo gets implemented.

Yes. I am worried about the coronavirus. Can we kick each other ? Of course. I don't know.

Any other answer to that question or what we call diplomacy. Flash loan. We are not responding to Progpo. I think flash loans are really interesting. Like it's interesting because you have a new financial primitive like this that doesn't exist in any other context , just because of what it is basically.

This is a loan that you have to repay within the same transaction. And yes, it has shown some very good effects. Let's see how it holds up despite its heavy reliance on sharding and asynchronous transactions. But we'll see. Where are you going with this ?

I was just going to say , are we still on Progpo or Flash Loan or what is my question ? Flash loan. Flash loan. Flash loans are great. And it will be very complicated to understand.

I think we will have to move slowly and will need communication, collaboration between many projects, and perhaps simplify some protocols and make slow progress. This is very good. Similarly, on the same topic, decentralized oracles. I think we we definitely need to do more work on them. M.

This is really out of the way we want to see it work , but what's less? What does it mean to get more work done ? Do we need more people or do we need to solve structural problems ? Different types of oracle designs to better explore the design space , and create oracles that are more secure and decentralized. Yeah, I have n't seen a framework yet that specifies what kind of rigidity is required in the context of Oracle for what kind of use cases.

So, whether it's in terms of value or in terms of political decisions, if we had that framework , we could create categories of oracles where anyone could send information, or any well-known organization that has a stake in their organization , that could be useful for sports like ESPN. And for high-value items, something that is very tightly or widely decentralized. Next is EIP559, and before you answer, would either of you like to tell the audience what it is? Of course. EIP559 is a proposal to improve the way fee markets work , where instead of a fixed gas limit and volatile transaction fees, there is a flexible system where the gas limit is twice or three times larger than the gas target.

So if demand fluctuates for a short period of time , all of this is converted into fluctuations in block space usage, rather than being converted into transaction fees. This way transaction fees become more stable. It also solves the problem of first-price auctions in the current fee market, where it is very difficult to understand how much fee should be included in a transaction. Most people pay very low fees and wait for a few blocks, and in the end this wait does not provide any benefit to the blockchain. This just means that the transaction loads a little slower, not faster.

So there is a lot of inefficiency here for no reason. And EIP559 solves all these problems at once. Very little was appreciated. Yes. Underrated.

Yes. So Vitalik came up with this idea. Eric Connor drove uh there's a little bias here. Wrote it. One of the few ideas that Vitalik gave in the Ethereum ecosystem.

Um and so this is actually very interesting. We initially uh we took various uh advice from professionals about not talking about Ethereum Ether uh Ethereum token uh in certain ways. And we were very interested in encouraging uh construction and growth rather than focusing on the financial aspects of the Bitcoin ecosystem and it's a fact that uh a strong ether secures our ecosystem better , draws more attention to our ecosystem and attracts more talent. And we never tried to fake anything to inflate the price of Ether. This is a quite interesting uh natural way to improve the protocol.

Which also has a uh probably very positive impact on the price of ether. And the last topic for this section , uh, is Bitcoin undervalued or overvalued on Ethereum? I think it's underrated. I think it would definitely be good to see other versions of Bitcoin on top of Ethereum with different and better types of trust models. As we only have centralized ones now , can we at least move up to a federation ?

Can we move to something crypto-economic ? I think it would be good to see more of these things. Yes. So, Ether is currently the bandwidth for permissionless decentralized finance and uh more bandwidth for permissionless finance is a good thing. Therefore, it was scored low.

I just noticed that there was no ' that there was no ' highly rated' answer here. So, Vitalik, one comment, what do you think is the one thing that is overrated in this ecosystem right now? Over-marked or under- marked question. That's good, I do n't know. To be fair, I think some of the answers were actually rated correctly.

It doesn't have to be binary but no, I mean DeFi in general is also properly rated. I think uh h I think our whole ecosystem and everything we do is currently undervalued. I'm specifically looking for something that's overrated. Can anyone point out something in our ecosystem that is overrated? Private blockchain.

Private because I wo n't repeat it. It's not in the audio. Um, it's okay. Um, it's okay. We will do this for audience questions.

Um, there was no response. There was I'm not sure that's a good thing. This is an ecosystem that is still incomplete, new, and largely undervalued. This is really interesting. Um...

Last question before moving on to Q&A from the audience. Um, what are some of your favorite memories of working together in the early days of Ethereum? Do you have any? I don't really have favorite memories , but... I don't know.

We just spent a lot of time together in places like Switzerland. Yes, he was very good. Just finishing the work together. That... it's something we both do.

Um... so... there are two things and you have to be careful how you describe them because it involves people. One, for a long time people didn't think Vitalik had a sense of humor sense of humor , but it was clear from the beginning that he had a pretty impressive sense of humor. So as people realized this and were shocked by it, it was very funny for some of us who knew him and watched him tell jokes all the time.

Um, and there was some interesting politics about the project at the beginning. Where people were starting to manipulate each other and Vitalik once said how people were trying to manipulate him. He said this at a meeting and it was very amusing to everyone how aware he was of what was going on. I think Ethereum maximalism is a bit exaggerated. This is very good.

Directly from the source. Oh, and by the way , thank you very much. We... Proof of Work has been exaggerated. Proof of work has been exaggerated.

Okay, that's it. This is it... we got one. I like proof of work, but it has been overhyped by some people. Yes.

Excellent. Oh, thank you very much. We will now move on to audience questions and answers. So what we'll do is, if you have a question, just raise your hand. We have had some questions from Twitter and other social media networks and we will repeat those questions directly.

But if you have a question here, raise your hand. raise your hand. We will pass the mic. Okay. Yes.

So we're trying this new thing with Pepo. Um, basically a lot of questions are being taken from the audience. This is the official community app of ETH London and ETH Global this year. Um, so the first question from Pepo is what are your current thoughts on the recent rise of DAOs and developments in that area? And DAOs are kind and great for the long term.

Yes, I know that the current version is probably being overstated a bit. I think that in general these experiments, all these experiments in decentralized governance, are very good, and things like Mo-Dow, for example, have made very good and valuable contributions to the Ethereum ecosystem. My main concern about this area is that people get lazy and they assume that a DAO is really just like a multi-sig with just 12 people voting. And it has its place, but it would be nice to see other people experimenting with things that aren't their thing. Yes.

Therefore, when people come together to do something, they usually need some kind of governance. We are creating all these network collaboration platforms in which we will live together, work together and play together. play together. And so we have to use these new, hopefully more transparent, more expansive, and more...more people providing agency , both financial and political, tools.

And so , yes, it will take us some time to turn really good ideas into robust code. And I think doing all this governance programmatically is a very powerful concept, and it's going to take a long time to build layers of this kind of infrastructure. There is a project that our Open Law Project is doing , called 'LAO', a legal document. And so we will see real Dow structures that are actually embedded in the legal infrastructure. And this will give confidence to many projects.

And oh, I love that 'Lao' is the word for old in Chinese. For gold. The old has become new. Good. So, I'll start from here.

Does anyone have a question? Okay, first question. So, do you think the world is moving towards a society where there will be no shortage of things ? And if so, do you think the education system is enabling us to...actually do what we want to do in our lives ?

I could n't hear him clearly. So, what are your thoughts on the current education system and how would you ideally like it to be so that we can prepare for a potential ' post-scarcity' post-scarcity' (non-scarcity) society ? Education system and non-deficit society. Basically yes. I don't think this is a post-scarcity post-scarcity society , I think we are definitely moving towards a different kind of scarcity society , a zero marginal cost society is a description I agree with.

And finally, there are still many ideas and innovations that we would love to have , but unfortunately we still do n't have and it's a shortcoming that I think we will be struggling with for quite some time. But it's something that is already leading to and will continue to lead to significant social changes , such as thinking about public goods within the Ethereum ecosystem and what kinds of models would be good to encourage. Just their further development. And as far as educational things that can help people adapt to this new world, it depends and I don't think there's one big thing. I think it's a combination of a lot of little things.

Yes. So I think a lot of technologies will lead us to something that could be called a post- material scarcity society or a material scarcity society. And. We are still human. We will still need attention.

So, it will probably be a scarce resource unless we have some really good simulations or robots or something like that. So maybe not. And we will be working and learning together on these collaborative networks. And that's why I think. we'll be going to festivals and it'll be art about art and gaming and so on.

And so, this technology. It would be a way for us to keep score, keep us busy, while not having to kill each other. Or there would be no need to do destructive things to remain fundamentally human. Hey Vitalik, Joe, it's nice to meet you both. My question is about decentralized identity, which I think has been considered a very important network core since the beginning of the project.

But perhaps it has n't fully materialized yet. So, what do you think are the challenges in realizing true decentralized identity? And when it arrives, what innovation do you think it will bring to the protocol? Of course. First of all, it depends on what you mean by identity because people interpret it differently, right ?

For example ? For example , there's a weak form of identity that basically says it's about people's ability to maintain some kind of permanent account that has a high level of security that they can use to interact with things. And this is something we are already seeing more and more of , both in the form of clear initiatives and in the form of generally growing tools in the Ethereum ecosystem. Then there's also identification, such as creating an account, or finding accounts that match a unique person. And I've written a lot about how this is a very valuable foundation for building many kinds of governance systems, because if you have coin-operated systems, which is really the only thing you can have if you do n't have a way to measure people directly, you can't distinguish a person with a million dollars from a thousand people with a thousand dollars each.

And so, because a person with a million dollars is better at coordinating with himself and a thousand people have difficulty coordinating with each other , a person with a million dollars will always outweigh others. Or yes, I think statistically it's still generally a 'they' generally a 'they' , but we hope that will change. Um, whereas if you have governance mechanisms that count people more explicitly , you can do things like quadratic funding. You can use other types of voting methods and the range of options you have to choose from increases significantly. And I know there are many projects that are trying to do that.

They are trying to solve this unique human problem in a very decentralized way. There are things like social networks and social graph analysis. There are different types of challenge and counter-verification. counter-verification. Here are ideas on how to combine this with strong support for privacy.

This seems to be a very interesting area in general. Yes. So early in the life of Consensus, we realized that we needed an identity structure to represent people, organizations, things, content, etc. And access to different systems is also required. We started a project called Upport a long time ago.

Upport has created many different versions of the cutting-edge technology of the time. And we've been working with many people in this ecosystem for many years to develop a deep understanding of this complex thing you might call identity. So we were one of the founders of a group called the ' Decentralized Identity Foundation' , which has developed a specification for decentralized ID. These are identities or structures that do n't require blockchain, but they make blockchain better and blockchain makes them better. We also run the W3C Verifiable Credentials Working Group , so credentials are cryptographic verifications that you can make between one identity and another or some behavior.

So this identity, credential or claims structure is going to become the identity and reputation system for the world. I think there is still a lot that needs to be done. needs to be done. Our port team is working with most different industries. There is Alastia which is a Spanish nation-state blockchain infrastructure.

There are also Latin American countries that are coming together to do it. The European Union's blockchain services infrastructure also exists. They're all using this framework now , which I think IBM, Microsoft and other organizations are also focusing on this idea of ​​identity and credentials , and we have a product that helps companies set up identities for themselves and for people. This is one way we can advance identity in the world, by enabling people to log into blockchain-based applications. We have internal software that we use to understand the consent process and your Port ID can give you access to that.

The content is also very interesting. We have a project called Civil that is enabling content to be given an identity , and soon we will see large media organizations putting their content in registries for licensing and verifying that the content was original. content was original. This is not fake content. Good.

We have time for two more quick questions. Hello to both of you. I wanted to know how you see the interface between the Ethereum ecosystem and traditional legal systems evolving in the mid-term future and whether you can envision a healthy legal approach between nation-states and blockchain systems. As economic activities are moving towards decentralized blockchains. I think a big question is what part of this is a blockchain- level concern and what part is an application-level concern, because different types of applications pose different challenges in terms of their interaction with the legal system.

Just as financial applications can have their own challenges and fundraising applications can have their own distinct challenges. Identity-related things can have their own unique challenges. There are some privacy issues and there are many things that different applications have to deal with differently. But having good relations with existing legal systems is a public good for the entire ecosystem. Unfortunately, if every project that people sink a lot of money into, even if it's entirely their own fault , it still has a negative impact on the entire blockchain ecosystem.

And so there are things we can do together to prevent such incidents from happening on a large scale. So there are also these application-specific challenges and there are also things that we can all do together to solve these challenges. Blockchain and decentralized protocols are an incredibly powerful technology that will enable and advance the reconstruction of economic, social, financial, and political systems on the planet in the coming decades. This is an exciting and scary prelude for many people who run companies, work in companies, are part of governments, or are regulators responsible for making sure it all runs smoothly. We have had many conversations with politicians, regulators and business leaders around the world about how they can use this technology ; Different countries have their own different philosophies and systems, so they will probably adopt this technology differently.

And this technology can be incorporated into legal systems. Ricardian contracts are the concept where you have a document representing a legal agreement that points to a smart contract. The contract points to that document. And so you have incorporated this new architecture into the old legal architecture. The old legal architecture also needs to be changed to enable new ways of working and for this many conversations have taken place and will continue to take place for a long time.

I recently spent two days as a member of the Board of Blockchain Policy Experts at the OECD in Paris. And it was about writing a document that all OECD people and countries could use to guide their thinking and encourage new thinking. But it's also a set of principles that you push out into the world and start a lot of discussions. This is not a rulebook , it's just all the things that are going on , that are happening, and that you should pay attention to. I think Germany now has a national blockchain policy , Australia has the same , so it's all happening and it's about discussions by countries, companies, etc.

, changing themselves to make good use of this technology. Many are already doing this , many will, and some others who will not. Darwin has something to say about them. Last question. My question is about funding for innovation and in the last few years, we had the crowdfunding method as you said funding, invention or innovation.

Innovation. That we've had crowdfunding in the last few years , including the way Ethereum was funded and the way some ICOs happened. Obviously, it had many flaws and some were even bad. But now that regulators have cracked down on the ICO market and crowdfunding in general and have created principles against people investing money in a place where they expect to make a profit , it will likely stifle innovation. We've had a period of great excitement, protocol development, application development, makers, status, etc.

over the last few years. And will we have this again in the future when regulators have restricted crowdfunding methods ? So will we have new funding innovation? Is this roughly the this roughly the same? Well, we've benefited from a lot of innovative crowdfunding in the last few years , with Ethereum itself being involved in those methods.

Now it has been reduced. What's going to happen in the next few years ? I don't think those methods are completely gone. The world funds many projects using outdated funding methods. And it's just a question of bringing out new technology and new ways of funding projects.

And so tokenized securities have n't really gained popularity in any interesting way. That doesn't mean they won't. I mean it's actually a better technology with which to issue equity and do portfolio life cycle management etc. We need to develop that technology further. We actually have a broker dealer that will enable us to issue securities and municipal bonds in the United States.

And this is an ecosystem that is very vast. is very vast. But it is somehow occupied by large financial institutions. It should be about raising money cheaply for local projects. It's about people who can benefit financially, by investing money in projects that benefit local people and have more control over that whole process.

It costs a lot to raise $5 million for a local swimming pool or something like that. So So , by putting this more efficient technology in place and enabling local people to control that process instead of some large financial institution. I think this is a huge market and it will have an impact , and I think we will see this technology spread throughout the financial system in the next 5 to 10 years. And I think 2017 was like a temporary nightmare for a lot of coin funding, because eventually, even if regulators had n't shut it down , people would have realized that these projects were raising money based on expected revenue , where expectations were much higher than the actual possible revenue , and you can't always create new assets. So I think that no matter what , we're in the same position today , where we're realizing that there are so many different kinds of valuable things in the ecosystem.

Some of them, perhaps, can be funded based on future revenues , but others cannot. And for those things, that's why Gitcoin Grants, Quadratic Funding and other decentralized grant mechanisms exist and it's definitely something that the ecosystem will continue to improve upon over time. Yes. The irrational exuberance of our ecosystem was not the first in history, it has been happening since tulips and before that. And the internet had its moment too.

And then there was a lot of creative destruction. All those projects that failed after initial enthusiasm, which were based on some interesting ideas and visionary people , knew what could and must happen. Many projects ended. Got to learn a lot. Those people moved on to other projects.

Some of them failed. A lot was learned and it's 2020 and we all live on the internet. Also, Joe Vitalik, thank you very much Vitalik, thank you very much for coming on stage. Thank you.