Vitalik Buterin I Keynote - Vision for the Next Decade of Ethereum I ETHGlobal Waterloo III

When we looked at all the information about all the information about who comes here and what excites them, we realized that many of you are just starting out in this field and want to understand what is possible here. So, to figure all this out, we decided to have a really interesting conversation. We're going to, I'm going to invite Vitalik to the stage to talk to you about possible ideas that you can think about. Not quite yet. That's it.

We'll spend the next 30 minutes looking at things to think about in this area, where we think significant progress can be made, what can be improved, and what is currently not getting enough attention. And all of this should help you get ideas for your hackathon projects and, hopefully, even for other larger projects that can grow into something more than just side projects. So without further ado, please welcome Vitalik to the stage. Okay, great. Greetings to everyone.

So today I would like to talk about things that I have already mentioned in various contexts over the last year or so. But mostly the focus is on what really makes sense to start working on right now, and what things are actually available to people just starting out in this field. Overall, the picture for me looks like this: Ethereum's two decades, and actually the last 10 years, have been about solving problems in theory, right? There is a lot of discussion around the transition from proof-of-work to proof-of-stake, discussing improving scalability, addressing privacy issues, increasing security, and much more. But, you know, it was still pretty theoretical; the number of people actually using blockchain was quite small for most of this period.

But the next decade should be much more focused on solving very specific problems that people have in the real world. So real world. So , there are already a lot of users of Ethereum, cryptography and everything else today, right? But it seems to me that in many places, very few people have found a use for Ethereum or other blockchains, other than for trading digital assets. Many people in many places have found use for them, but mostly they use centralized exchanges.

Um, so, um, just, uh, let me tell you a story: this photo, um, excluding the anonymous masks to protect other people's privacy, was taken during my trip to Argentina in 2021. I remember my visit and I remember seeing the huge Ethereum community, you know, the crypto community in general, the developer community, um, just an incredible amount of people using ETH, you know, using all kinds of cryptocurrencies to save money. Um, because it's actually a big need for them because of the currency situation in the country, and people even just accept it as payment, right? For example, I just happened to walk into a coffee shop and it turned out that the guy there just knows a lot of things about cryptocurrency. He happened to have a Binance wallet, and I asked, "Hey, can we pay with ETH?"

and he said, "Sure he said, "Sure ." Um, so there's a huge amount of adoption, but there's a caveat, and that's that while cryptocurrency is being widely adopted, a significant portion of that is significant portion of that is actually Binance wallet adoption, right? So, essentially, many people who use both Ethereum and other cryptos are actually doing so through a centralized intermediary. Now, why do they do that, right? Because centralized exchanges are cheap.

Um, that means cheap. Um, that means that if you want to, you that if you want to, you know, send someone money inside one of these centralized systems, you have zero fees. This is convenient. Um fees. This is convenient.

Um , in particular, payments are instant. Transferring from Binance to Binance is instant. Um, when I paid from my Ethereum wallet, um, the transaction confirmation took, I think, two to five minutes. Um, and now this is actually something now this is actually something we've made some improvements to. Yes some improvements to.

Yes . So, who here was using Ethereum before 2020? Um, who has used Ethereum in the last 6 months? Um, you may have noticed how it has become much easier to confirm transactions quickly and reliably. This happened thanks to two changes in the protocol.

One of them is called EIP1559, it's a very strange economic- economic- technocratic thing with a lot of interesting mathematics behind it. Um, but its main function is that it changes the fee market, so instead of requiring a fixed number of transactions in each block, I mean blocks can get bigger or smaller to adapt to very short-term changes in demand, right? And instead of keeping a constant block size, the protocol maintains a certain constant transaction fee, or what's called a base block fee, and it adjusts over time, right? So, because of this, instead of a transaction taking a random amount of time, which is often minutes. A transaction can be included in, well, you know, about one or two blocks.

And then what the merge did, as a strange byproduct of statistics and the difference between Poisson distributions, Poisson distributions, was to get a block every 12 seconds. It turns out that the average wait time for your transaction to be included in a block is, uh, divisible by two. This, this is only half as much. So if anyone here is into mathematical proofs, prove it proofs, prove it . Uh, the deadline is 72 hours, go ahead.

Uh, but the point is that Ethereum has already made a lot of strides in this regard, actually. But when I was in, uh, Argentina at the time, EIP, the merger had n't happened yet. EIP1559 has already happened, but the wallet I was using didn't support it yet. And now this wallet actually supports it, right? So such exchanges are cheap, convenient, and protect the user from mistakes.

Uh, you know, if you made a mistake, you can contact their support, maybe go through KYC again, and you'll get your money back. With Ethereum wallets, this is something that, at least as things stand, you can't really do. You know, you have your 12- You know, you have your 12- word seed phrase, and if you lose it, you're in trouble. If someone else takes a picture of your 12-word your 12-word catchphrase, congratulations, they have all your money, right? So, centralized exchanges do not have these problems yet.

But there is a dark side to centralized exchanges centralized exchanges , right? Uh, does anyone here recognize some of the people in this photo? Yes. Right. So, centralized exchanges centralized exchanges , you know, are also sometimes, you know, not very, uh, trustworthy.

Uh, they, you know, do different things and, uh, sometimes decide they're better at managing your money than you are. OK. So, like, essentially, uh, you know, this is a space that's completely dedicated to decentralization. What is decentralization is decentralization ? It's that we build systems where you can't be "thrown."

There are now many ways you can be "dumped." This is, you know, when you have all your money stolen all your money stolen . This is when you are blocked from PayPal and they hold your money for 180 days without being able to do anything. This is when you are blocked on a social network without the ability to do anything. You know, there are a lot of cases of fraud, right?

And in a decentralized system, you have to have programmatic rules that are transparent and describe the processes in any application that you use, right? It's a wonderful dream, it's good, and you know, it's worth trying to put more control and power back into the hands of users and communities, as opposed to these distant centralized entities. But there are some challenges, right? Therefore. I think some of these challenges are fundamental philosophical questions, but some of them, I think, people don't realize are technical problems that can be solved technically.

They just have n't been properly solved technically yet. Isn't that right? So, one of them is scalability and fees. Yes? When I paid at that coffee shop in Buenos Aires, the transaction fee was about three or four dollars, right?

If it was a Binance to Binance transfer, it would be $0. Now, in 2013, I remember, there was this movement that was really trying to get people to accept Bitcoin as a means of payment between consumers and merchants, just so people could pay in restaurants, in coffee shops. There was even a district in Berlin called Kreuzberg where people created this movement to convince a huge number of restaurants in one area to start accepting Bitcoin. It was called "Bitcoin Kiez". I have actually visited a few such places in my time.

There was a burger place there. There was this wonderful vegan restaurant. There were several others. And it was a truly wonderful move. But over time it faded away.

Why did it go out? Essentially Why did it go out? Essentially , because of transaction fees, right? In 2013, the main argument for accepting Bitcoin over credit cards was that credit cards charge about 2.9% charge about 2.

9% for each transaction, right? In fact, PayPal takes 2.9% for each transaction. For international payments, PayPal actually charges 2.9% PayPal actually charges 2.

9% plus 3.9%, and even more for currency exchange fees. Maybe that has changed. Maybe things have changed since then. I don't really know, do I?

Oh, it seemed like the perfect pitch back then, and it was true back then, but the problem is, you know, the low commission story has actually stopped being true, right? Um, so I mean, this is a critical obstacle, right? For example, many applications that are perfectly normal and make a lot of sense if the transaction fee is negligible cease to be so if the fee is $843. Um, who here is interested in using Twitter alternatives? Twitter or who here would be interested in using Twitter alternatives if registering your account on that alternative cost $843?

Um, $6,912. Um, $3,841. OK. So, you know, we have some true believers, and that's good, right? But, you know, the point is, it's a pretty boring topic, yet they're killing things that would otherwise be extremely promising.

And I think the implication of this, which is really important, is that people shouldn't consider an app category a failure just because it didn't work in an environment where it cost $8.31 to set up anything. Um, problem number three, um, privacy. Um, who here likes the idea of broadcasting to all their friends, future friends, family, the government, and every company? Um, what exactly, to whom and what types of payments do they make.

Okay, we have a few true believers, and that's good. But, you know, privacy is valuable, right? So the other challenge is to implement all of this while keeping Ethereum recognizable as Ethereum, right? What I mean is that there are many different groups on Ethereum building many different things, and that's good. This is great.

We have an open ecosystem. You know, we have a lot of groups that work independently, and new people can come in and start building independently without asking permission, you know, you don't have to apply for an API key. Um, but, um, one of the problems is that there's a possibility that everything will eventually branch out into completely separate systems that don't intersect with each other, look very different, and have completely different properties than what already exists. Yes? So, good scaling is the ability to do what you do now, but paying 10 or 100 times less transaction fees.

Bad scaling is when you have something completely new and people tell you, "Yeah, it's Ethereum, it scales," but it just looks like a completely different thing. And if your friends use a different way of scaling Ethereum, you become incompatible, and there is no way to switch between these networks, and it is not entirely clear what their properties are what their properties are , so everything turns into complete chaos, right? So, here comes another problem, which is more like a coordination challenge, right? Namely: how do you make sure that all these different pieces— these different pieces— scalability, account security , privacy—are privacy—are actually working together? And that's difficult, isn't it?

But this is something I think we can start moving towards. Here's a concrete example: who here wants to create a wallet? Wallets are interesting, you know. So, in the past decade of Ethereum, it was enough for a wallet to simply support sending ETH to other people. You showed your QR code so others could send you ETH, and perhaps went into the built-in web browser to access some decentralized applications.

In the future, this won't be enough for your wallet, right? A wallet that makes sense in a post-scaling world must support Ethereum’s first layer, as well as at least all of the major second layer protocols built on top of Ethereum. It is necessary to build in a transfer function between L2 levels. If all my money is on Optimism and you want to get it on Arbitrum, I just have to click “send click “send ” and the funds should automatically go through the L2 layer exchange protocol to get to you, you know? This should happen automatically.

This is something you don't have to mess with personally when figuring out what Hop is. How the stock exchange works and how to use it. This should be standard behavior that simply triggers when the " " send" button is pressed. A way for the recipient to specify exactly how they want to be paid. This is another point: it seems like there won't be enough addresses.

The address enough addresses. The address is only 20 bytes, but where exactly? Do you want to receive payment on the Optimism network? Do you want to receive funds on Polygon, or perhaps you would be more comfortable with payment via ZKsync, Kakarot, or Polygon? But someone else has coins in Kakarot, Scroll, and Arbitrum, and, you know, it turns out that Polygon it turns out that Polygon is an intersection point, so you just do a direct transfer there, right?

Well, that's exactly what you just need to do, right? And that's exactly what , for example, Trafi does in many ways under the hood, right? Who here has used a credit card abroad, huh? There's a lot of these, you know, hidden inter-exchange exchange protocols going on there. And, you know, really, Ethereum level two should do the same thing, right?

The nice thing about projects like this is that you don't have to invent your own cryptography for it, right? You don't need to create something big from scratch. All it takes is a simple combination of several protocols that already exist, right? You just need to combine existing tools for accessing Optimism, existing tools for accessing ZK-sigs, and maybe the Hop protocol or a couple of other routing protocols, with the possibility of adding more in the future. And, you know, make a "send" button that routes transactions correctly routes transactions correctly , maybe create your own format for providing information about where you want to receive payment.

And then, if people like it, then in two months you can come to creating your own ERC creating your own ERC . So, I think this is something that a hackathon team can do, and I think we need more of these things. Another challenge for wallets is challenge for wallets is social recovery and multi-signature. So if you just go to my blog, vitalik.ca, and press Ctrl + F to search for “ + F to search for “ social recovery,” you’ll find an incredibly long post I wrote on the subject.

But in short, the idea is that the existing ways of creating wallets are incredibly insecure, right? Most wallets are so-called EOAs, i.e. external accounts. These are accounts that are controlled by a private key, right private key, right ?

They are called external because other types of accounts are controlled by code that is part of Ethereum, yes. So, the problem with OAS is that they are controlled by a single key. And if you lose that key, you're in trouble. If someone else steals this key, you're in trouble. If you create multiple backups of your key to reduce the chance of losing it, it increases the chance of someone stealing it, right?

So, you know, it's not really a very good design for a huge number of people, right? Honestly, that's not even enough for me, is it not even enough for me, is it ? For example, I hold my money through multi-signatures. So, what is multi-signature? This is a wallet where there are several keys, and you need a certain part of them to transfer money.

Um, social recovery is a concept that's closely related to this. Essentially, you have a wallet with one key, but there is a set of backup keys that other people own, and this set has the ability to change the master key if you lose it. Yes? So, social recovery only protects against loss, not theft. Multi-signature protects against both loss and theft.

The advantage of social recovery is that you only need one key to sign transactions. It's usually easier, right? So social recovery is a good fit for a hot wallet. Um, and multi-signature is good for a cold wallet, right? Multi-signature is great for, say, storing your savings, but you would n't want to store all your savings where everything you need to empty your account is on one device, right?

So creating a wallet that supports that really well. And now privacy. So privacy is also an important challenge, and I don't want to go into detail, but there are a lot of very interesting privacy technologies that are really worth considering. So, identity, right? So, ENS at the second level (layer 2) is already being implemented, right?

Um, so ENS has a name here. THERE ARE ! This is, you know, a big part of the new layer of identity in Ethereum, right? If you want to have a name, and you want that name to be decentralized, so that it is truly controlled by you, and not dependent on any other structures, then the decentralized ENS system based on Ethereum is what you need. One of the problems with ENS is that it is expensive.

There is currently a registration fee. There is a fee of $8 per month, and that's about as much as you'd expect for regular DNS fees. But there are also transaction fees, right ? So, last time I was doing some operations to configure or do something with my ENS. It seems like the last thing I did was publish a new blog post, and since my blog is tied to IPFS, I needed to update the IPFS record inside the ENS contract that contains the IPFS hash, which is a transaction, and it seems like it cost me about $8, right?

So what about $8, right? So what if transaction fees increased 10 times to what they were last year or the year before, right? Then that $8 transaction fee becomes an $80 fee, right? So, ENS at the first level (layer 1) is expensive and may become even more expensive. ENS at layer 2 layer 2 is the solution, right?

We want people, we are working on the second levels. Levels are scaling, but we want Ethereum, we want applications that people actually use to benefit from this scaling, right? And there are many hidden assumptions throughout the Ethereum ecosystem that seem to assume that you are at the first level. And if we want people to really benefit from second-tier scaling, we really need to start breaking down those assumptions, looking at the important applications, and essentially understanding how to make them second-tier compatible. This is a screenshot from a resource called opsynames.

xyz, and it is built on a protocol called ccv. It works like this: you have a smart contract at the first level that owns ecc.eth, and that contract has logic based on the CCIP protocol that says: if you have a subdomain ecc and you look for it, you can go somewhere else and check what that subdomain actually is in Optimism, right? So instead of doing everything at the first level, subdomains ecc. all managed, updated, created, and deleted in Optimism.

So if you had your own .ecc domain. Updating any records only requires being in Optimism. This does not require any transaction at the first level. So from a gas perspective, it's all much cheaper.

So, this is Optimism. I uh, asked a few other "layer 2"s if they had any analogues, and about a couple of weeks ago the answer from the one or two I asked was—not yet. But I assume they will be soon, and it's quite possible that others already have them, which is great others already have them, which is great , right? This is one example of what I think is good and what we need more of: the ecosystem is really adapting to layer 2 scaling and ensuring that this scaling translates into real benefits for users, which is great. Now about other things in Ethereum identification, yes.

So, this is an app called Zupass. Um, basically, you know, it was developed in Zuzulu was developed in Zuzulu , which was kind of an experiment in the spring in Montenegro, where, you know, they were trying to create a kind of pop-up mini-city that combines, you know, Ethereum, zero- disclosure technologies, and a few other themes. Um, but one of the really interesting things is this aspect of zero disclosure, right? So this QR code contains a Z-case, it contains zero- disclosure evidence, right? And that's exactly what this zero- disclosure proof says: it proves that I am one of the inhabitants of Zuzulu without revealing who exactly I am, right?

So this is a usage scenario during an in-person meeting, right? Um, and this scenario is that you have this thing on your phone, and because you have it, you can go up, show it, and use things like that as proof that you have the right to enter somewhere without having to reveal your identity every time and without having to be followed everywhere. Um, that's exactly what's really involved with many aspects of e-government, except that it allows you to do everything without compromising privacy, which is unfortunately a standard problem with many such schemes. Um, again, there's also an online again, there's also an online component, right? There are apps like Zupool, for example, where you basically log in through Zupass, so only Zuzulu residents could log in, and you can get one account, meaning you can cast one vote, right?

This is a survey system. Anyone can create a survey. Anyone can vote in the poll. You can cast one vote without revealing your identity, but at the same time proving that you are a legitimate voter and cannot vote more than once. Isn't that right ?

So this is a voting system that preserves confidentiality and is anonymous, but at the same time ensures that the Kremlin can't go and vote 58,200 times. So this, um, overall, I think there 's a big story here that with cryptography, we actually have the ability to give people a very high level of privacy and anonymity. But at the same time, you know, to achieve many of these security benefits, which are, let's say, purely attempts to achieve anonymity without anonymity without any verification, they're not able to provide, right? So we can get more privacy and more security at the same time. And it's also part of what you know, the growing Ethereum identity stack.

Other attestation protocols include the Ethereum Attestation Service—EAS. So you can also do off-chain attestations on different things, and these are really systems that are increasingly interoperable with each other, so we have these tools, we have names that are getting cheaper. We have a growing list of truly exciting ZK truly exciting ZK tools and their increasing ease of use. We have off-chain certifications. We have on-chain certifications.

What can we do about all this? One example is example is the use of this technology in decentralized social networks, right? Many people want to use a Twitter alternative. Who here wants to create an alternative to Twitter? OK.

No, that's good. It's actually better not to have too many likers because we don't want to have too many Twitter alternatives that only have 50 people each. And, you know, at some point people just get bored and they go back to Elon country. But, you know, there's Farcaster , there's Lens, there's some others. And you can...

some of them are starting to integrate more and more of these Ethereum features, right? For example, with Lens, I mean, you can use your existing ENS name. Farcaster existing ENS name. Farcaster seems to be moving towards integrating ENS with CCIP. And one more thing you can do: instead of trying to copy Twitter, you can try to create something completely new, designed for new use cases.

Isn't that right ? You know, one of my concerns about the old Twitter approach that everyone is taking now is that this is standard advice for startups: if you want to build something that will truly displace the market leader, you can't just make something 1.1 times better. You have to make something that is 10 times better. You can't just appeal to some narrow ideological interests.

You have to create a whole new category of activity category of activity , right? For example, Facebook didn't kill MySpace by simply copying it. Twitter didn't copy Reddit. And if we think about what the biggest new social network has really taken over the market recently. Well, realistically speaking, it could be TikTok, right?

So, TikTok is not just another way to express yourself in 180 characters. So another way to look at the social media problem is to create something that is native to Web3, decentralized, has open and transparent rules that are enforced programmatically, but is designed for a different use case. One interesting and very natural scenario natural scenario is discussion and governance within communities, right? So existing DAOs are good potential users, and perhaps even new communities that want to use various Web3 tools for self-organization could also be an interesting example. So, why?

Alternatives to opaque centralized mechanisms for some aspects of moderation, right? For example, spam protection: proving that spam protection: proving that you are a human, not a bot. There are already many Ethereum-based reputation tools that can be used for this. Even simply having an existing address on the network already requires a transaction fee. That's a significant degree of spam protection, right?

Okay, if you look, there's a site like byax.com, right? Maybe we should just make it transparent. BUACCS.com.

You can go in and just buy Google accounts, Twitter accounts, and more, right? And they accept Bitcoin and Ether as payment. So, you know, everything is great, right? And the average cost of an account there is about $6 or $7, right? That's what spammers pay for, right?

And, honestly, spammers have much better tools than this, right? So, if you have a new Ethereum account that has just paid a transaction fee, that's already better anti-spam than what social networks offer, or at least as effective, right? Additionally, you can check if people have POAP, if they have some kind of stamp confirming that they are people. If you want to integrate Worldcoin, let's say, to have people scan their eyes, then in my opinion it shouldn't be mandatory, but as an option—why not? If people want, they can use a specific function for all the different identification systems identification systems they have.

You can use EAS certifications together with Zupass. You can create zero- disclosure evidence that confirms certain data about so-called stamps—this is a type of POAP or attestation system inside Zupass. You can prove a certain function regarding the stamps you have without revealing all the information about yourself, right? So there are many alternatives for combating spam that can be combined with each other, and they are quite native to Web3 even today. Reputation helps users determine which accounts are worth listening to and which are not serious.

Another advantage is that Another advantage is that the user owns their own identity their own identity , it is portable, and the connections you create in the system can be easily transferred if you want to move to another application. The best tools to protect against attackers while maintaining privacy. About a year ago, I wrote a post about privacy-preserving apps on Zuzalu and Arts. One interesting idea here is that you can create an anonymous forum that also enforces the rule that each user has a limited amount of reputation. And if some moderation system—it could be anything: centralized, decentralized, a dislike system, or something else— or something else— flags a certain post, you lose one point you lose one point , and your account can only exist as long as you have points left.

So you don't have to choose between full transparency and 4chan. You can literally explore every point on this spectrum, right? So, a lot of these very powerful new capabilities are becoming available through zero- disclosure evidence, and I, you know, strongly encourage people to try to look at these things and explore them. DAO, um and explore them. DAO, um , so what?

And DAO Governance—that’s a really difficult problem, isn’t it? We've seen a lot of DAOs, but one of the problems I see is a lack of originality in how we think about what a DAO does, right? A lot of people have the mentality that all you have to do is create something, issue a token, give your friends some tokens, they start reselling them, and then if you have tokens, you can vote, right? And there are a lot of people who think that's what a DAO is, right? And I have to admit, this is not at all what I had in mind when I started thinking about this concept back in 2013, right?

So, DAOs, decentralized autonomous organizations, are essentially organizations, ways of uniting people into communities that involve the use of some kind of blockchain-based technology and smart contracts, right? There are a lot of really powerful things you can do there, but you really have to go beyond using token voting token voting , because token voting is imperfect in many ways many ways . The first tip for managing a DAO: management is hard, and if you can avoid it, it's probably worth doing. Creating singletons is difficult, and it raises political issues. As soon as you create a singleton, that is, as soon as you create a single thing that is logically centralized, even if it is architecturally and politically decentralized, if it looks like a logically centralized entity, then it creates political problems.

People will have expectations about how he will act fairly. Will people have complaints about whether it was created fairly created fairly ? Was this community created to favor a group of people I don't belong to? Yes? So, creating singletons creating singletons is difficult.

This causes political problems. If you can do without a singleton altogether, then it's a good idea. But sometimes having a singleton is inevitable. Isn't that right? And so try to go beyond token-based governance.

As I mentioned, token-based governance has a lot of vulnerabilities, a lot of, uh, just problems with how it ultimately works in practice. Um, I think one of the questions to ask is: are you decentralizing for reliability or for efficiency, right? Are you protecting yourself from internal threats? Are you protecting yourself from external threats and trying to solve the problem of censorship resistance? Are you trying to decentralize because you want a mechanism that will help more people provide input to decisions, and thereby create solutions that are better for everyone?

Are you trying to create a decentralized system because you see it as being more efficient in a certain way, or are you decentralizing for the sake of interoperability? Yes? This is the third category. You create a decentralized thing decentralized thing so that it can better interact with other decentralized things. Yes?

If you are building a decentralized protocol, you don't want to build it on top of centralized APIs. So if you want to serve other decentralized applications, often you need to be decentralized too, right? So, I think it's always good to look at which of these reasons for decentralization you're going for, and depending on what you choose, the type of governance you're going to have will often look very different, right? So that's also something to think about. experimenting with new mechanisms, right?

So quadratic financing is an interesting thing that Glenn Vale and, mostly, I know, with some of my input, came up with back in 2018, and it's really cool. Um, this is a kind of democratic, market-based way of financing public goods. The idea is that you have a central funding pool that serves as a co-funding fund, and that allows other people in the community to donate to projects, and the central funding pool co-funds projects that receive donations from other people. Now, co-funding works in this interesting way, where it basically uses this clever formula to calculate co-funding, where the practical effect is that smaller contributions get a higher co-funding ratio than larger contributions, and everyone's co-funding ratio is higher if more individuals contribute to the project. Yes?

So, things that are actually public goods for a broad group of people get a higher co-funding ratio than things that only benefit a few people. Um, so this is a really good idea, and there are various decentralized mechanisms that are actually building on top of this, or using this as their mechanism. There is a CLR foundation that uses zero- disclosure evidence to implement this in a way that preserves privacy. So, there are a lot of really good things happening, including retroactive funding. Retroactive funding is the idea that instead of giving grants to people because you think they're promising, you give rewards after they've already done good work.

The idea is that retroactive funding is easier to implement because it is easier to understand what has already been useful than to try to agree on what will be useful in the future. The general idea is that if you have a retroactive funding mechanism, you can combine it with an investment ecosystem. You can let people invest in projects, and they will also get rewarded will also get rewarded if the project succeeds and gets a large retroactive payout. Or it could be independent developers independent developers : if there are several retroactive funding systems in the ecosystem, they can work on projects knowing that they will receive some reward if they succeed. So there's a lot of interesting stuff going on around retroactive funding.

Optimism has already conducted two rounds of retroactive funding. They've had some pretty big rounds— big rounds— the last one seems to have distributed around $20 million between projects that have brought real benefits to the ecosystem. It seems that even the creators of the Keccak hash function received some funding , and it was a pretty substantial grant. So there are many successful experiments being conducted with this as well . This is another aspect of the very interesting things that can be done with crypto technologies.

You can create mechanisms to solve problems where useful projects are under- rewarded and cannot compete with large exchanges offering millions of dollars. There really are many amazing opportunities here. So, to summarize: there is a lot of valuable stuff happening in Ethereum at both the application and infrastructure levels infrastructure levels . Among the main topics: confidentiality between layers (L2), further work on mechanism design, identification, ZK. Things are much more concrete now than they were 5 years ago.

Five years ago, there were a lot of, you know, quite abstract discussions like, " discussions like, " Oh, this is going to solve financial inclusion, this is going to fix supply chains, this is going to tackle fraud," and I think the discourse has moved significantly towards these much more concrete applications where you can't just go around saying, "This is going to make the healthcare ecosystem more secure because we're going to put QR codes everywhere, going to put QR codes everywhere, " and, you know, you have to actually think and propose things that make sense in the real world, not just in the world of GPT-4 or whatever, right? Um, one more point: I think now is a time when getting involved and participating is probably easier than it was five years ago. And the reason is precisely that now there is more focus on specific things that are closer to the user. Or they already exist and are constantly being improved. The problems I talked about today talked about today are not the problems that require the creation of deep tech.

These are problems that just require using existing technologies, applying them correctly , combining them in an appropriate way, and packaging them in a way that really makes sense to users, you know? And this is exactly what our ecosystem really needs right now. So, you know, if anyone wants to work on any of this, I'd be , you know, really happy to see the results. So, thank you. Perfectly.

I hope you enjoyed this huge outpouring of ideas to work on. By the way, many people have already talked about implementing some of these projects when they filled out applications for participation in the hackathon. So you can get a lot more feedback here from our mentors, everyone in the room, and everyone watching this broadcast, especially the new big group from Nigeria. I hope you enjoyed this report.