Julien Bouteloup, Stake Capital Group & Sebastian Bürgel, Gnosis:True Decentralisation:Meme or Goal?

next up um we have a debate on true decentralization is it a meme or a goal we should be striving towards who knows um so we have Julian uh from state capital who is arguing on the side that it is a meme and we have Sebastian from nosis uh who will be arguing on the side that it is the true goal so and uh Ivan from Aragon who will be moderating the session [Applause] hey Manet you it's a cool event and a cool stage that's why I'm returning you okay uh last time I did a debate it was Mark versus Paul and I barely managed to wedge in a word I'm hoping for the same level of energy here here um okay let's get into it um through decentralization sounds very loaded what does it mean I for each of you all right uh maybe I take it um Chancellor on the brink for second bailout of banks rings a bell yeah so that's not just embodied in the Genesis block of Bitcoin but it really goes back to where the space started you know there was a financial crisis was largely driven by manipulation of a few old men that you know made decision behind closed doors that got individual people screwed some of them lost their homes their livelihoods and a lot of the things that they couldn't do anymore because things were frankly [ __ ] up and we started the move movement of building a more transparent world that empowers the individual and not just the governments and the for-profit corporations to be in charge of their money and their data right so to me decentralization matters because I believe in that spirit I believe in the spirit that we can use decentralized Technologies to build a world where the individual does not get absolutely screwed by a bunch of Rich old men that get richer for doing so and I do believe that what we build can contribute to get there and that's why at least for me it's a goal that I wake up in the morning literally every single day pursuing um well first I think the question to answer your question uh what is decentralization yeah what what what does through decentralization mean and and yeah I think it at the end of the day decentralization it's um the main goal is about minimizing the risk right saying that this space doesn't have rich people I think it's uh not really looking you just like it's it's kind of uh not looking at the space correctly and saying that the space doesn't have encountered multiple different hacks it's also not really looking at I'm not sure if you've been sitting in a space for a long time uh or you just join but um running great news um I can tell you uh a lot of people lost money um looking at Dows I can tell you that the entire defi is probably driven by 10 people in term of governance and delegation of voting power so we should keep it going that way no what I'm saying is that if you believe decentralization is better right now than centralization um U it's kind of a tough uh statement because a lot of people lost money the space is driven by a couple of strong projects strong leaders and influencers that are making way more money than actually the guys that are working in traditional Finance traditional Finance you work for many years you have to climb the stairs you make uh 100 200k and then you pay the bonus at the in in in March but you work very hard or here you can ship a a mem coin and get uh a billion dollars in your pocket have you provided any value back to the community it's tough um no but at the end of day I think decentralization is giving the opportunity for everyone to be involved in a system and minimizing the risk that's what we should start with but saying people don't get rich think that is pure and transparent I don't think this is true yeah I think one of the one of the challenges is it's it's hard to measure and that's why we we we end up with this like you know some of it is true some of it is a LARP or a meme uh is is there a recipe to distinguish of like who's genuinely gunning for decentralization versus who's laring well look we uh decentralization came up with the concept or we try to build decentralized system with Dows as I mentioned this morning Dow stands for decentralized autonomous organizations and what we end up with is decentralized autonomous chaos so I mean that's the point like look uh tell me any uh any doubts that have are still remain or have been actually still um providing any value they all collaps no one actually mentioned when they build a project anymore can be L2 or anyone that they actually building a dow before two two or three years ago it was like oh we actually building a dow you should invest and now they everyone is trying to Avid the world the Dows so I think if you it's it's tough question because when you raise at high valuation it's really good for boo striping a project but I would say that most project that have a token today they don't actually use it for utility in the protocol but only for bootstrapping the product but they don't actually need the token if you look at the space not many tokens are actually useful and the project with the most successful um like capital gain or valuation are the one that actually don't use the token for the protocol but we also build V to economics so uh it's useful and in certain way I mean to me it comes down it's not a technological question it comes down to the intent right and that's why I think this debates are important and as juli was pointing out if you put the bar at you know how can I get to the 200k that you know my banker buddies you know that you know take more coke than I do um make how can I get there faster that's the wrong bar man like that's the wrong game to play like for my perspective the game is how can we Empower more people on this planet to not get [ __ ] that's what success means to me you know I mean yes granted you buil R HQ and it's kind of funny but like talking about it like were you around when the do got hacked like I took a that moment you know five years of my money not counting towards the 200k that I make to get to the banker level but like to Counterattack the network to spam it to you know stop the the draining at the time to me really it's like now would love to have that five E right I don't but so you know to me it all comes down to what is the intent of the people building this space we have to keep the values up that's the only thing that makes I know how to answer the question remove any value or any tokens you will see the attent of people the room will be empty here sorry say again remove the token or the money aspect of what we building which is called decentralization there will be not many people left in the industry and maybe that's better I don't know I'm asking okay well I'm saying that's better like the people who do not have the right values they better leave than contributing to some reaking reaking per deck layer 3 rwa [ __ ] that you could have built literally 10 years ago on SQL by the way I'm not [ __ ] on SQL SQL is fantastic technology PHP is fantastic technology please do use it right like SQL is fantastic you could have built reaking and RW on SQL what do you do it like if it's about making more money don't go with this shitty like web 3js and like the evm is like the shittiest VM you can build it on if you want to build an rwa perex why don't you like Why didn't it happen like 20 years ago or why do you bother to work with like VMS are you asking myself and now you're against this P so you have for I'm I'm asking like why if you take the position that it does doesn't matter why bother with this [ __ ] at all because it's objectively shitty technology why bother with shitty technology instead of building on reliable technology to make even more money well no that's the point like if you build in blockchain a token you actually the market that you're typing in is bigger and you can distribute the value that's the reason why people will actually use your product if you use a centralized system like a centralized Dex a centralized exchange people will not actually be incentivized to use a product because you will not have direct incentive for using the product that's the reason why people like to build blockchains projects is because at the end of the day they find themsel being directly exposed to the success of the project it's kind of like it's kind of gambling the entire space is about gambling because they actually using the project because they know they be exposed to the success of it and they know that one way or another they can be either accumulating like I'm not saying this is legally correct but Equity of the products and also dividends and revenues that's what makes uh uh those this space interesting for that concept not necess about the token of the project but I'm being triggered it's not gambling it's go to market man oh yeah of course of course I didn't say gambling actually it's uh it's my my French accent I said I said go go to market that's okay but is your argument then like the API access to New York Stock Exchange is so shitty that we need a new system or like what's your foundation to build on this new paradigm like I outlined mine like what is yours like why do you come here and build on ethereum instead of building on a New York Stock Exchange because it's great like you have literally the smartest people for decades have been working on a New York Stock Exchange their API interfaces their you know realtime settlement systems and so on we don't even have that do we have realtime settlement system no we still talking about single slot finality we don't even have that yet right so we've objectively worse systems and I've not heard one reason why you know we would do that so if is quite easy to turn this guy against the system I mean against what we were building because before I was the guy and now he's the one yeah yeah so I think I won I I I think um like uh an an interesting question in in in this Duality that we're shaping up here is can like like if you have two systems that are sort of doing the same job functionally uh can the decentralized one be more valuable well again it's distribution of value composability so the point of the centralization I believe it's the fact that anyone can be involved without asking permission and you can also Plug and Play different type of products um in order to to leverage on existing stack and to capture more value um that's a beauty of and that's the only reason I think um we are better building in De centralized system but I also truly believe that in order to build the centralized system you need strong centralization of power um I haven't seen any project in space except two only I think there's only two example in the space that were studed as decentralized system and still operating a decentralized system are Bitcoin and ethereum otherwise it's all the other project that I've tried they all failed because it's toxicity and chaos and and now you have um and now you unfortunately in most of the project that started as a dow for decentralization sake um they now have delegation of voting power which makes them at the end of even more centralized than a centralized entity uh so yeah I mean I that you need at least initially a strong founding figure and I'm certainly one of those who calls for I wish vitalic would be even more outspoken on the direction in specific goals of ethereum right I wish ethereum he does it but online without talking to the foundations yeah but but even there right I wish it vitalik would be you know more explicit about defining this North Star of ethereum he said he said the tier is e yesterday on Twitter but it doesn't have head no but so I mean the um yeah so I admit that we do need some more you know at least guidance at least initially for a bunch of uh of these projects but in order for them to really play out we need some goals and the question is to me is like you brought this question on value and I'm like value what does that even mean like you know Julian's position is easy right as somebody who's coincidentally also investor like oh value for the VCS maybe right values for the shareholders but like is that the right value to optimize for isn't like a lot of the [ __ ] because we've seen over optimization for this kind of more [ __ ] Direction like I do think you know that a lot of spaces are bad and toxic because we have too much investor mindset yeah so I mean this whole Space started from a kind of Cipher Punk directional and that got lost and that is a Pity and a lot of infrastructure would OB same you advocate for having less money when you already have money that's that's the point like if you have money you advocate for less money if you don't have money you advocate for money no I'm not I mean to me one one point is ethereum is too money Centric right I mean I think ethereum could be a way better system if it would be less money money Centric right so the money of everything we talk about and try to build gets corrupted by the systems and you know flashboards on meev is a fantastic example we have tons and tons of infrastructure that is now built around something that you know was to make a bit more money somewhere and to democratize access to it and all of a sudden it screws up Layer Two scalability Solutions you know because literally you cannot make based rollups properly happen if you have full centralization block Builder space that's [ __ ] up and that is a direct consequence of too much focus on the money you're advocating for decentralizations but I think you then we move some aspect of that what makes decentralization decentralization also it's a based on Game Theory so normally you can be um resistant to any um criterias or um outside V attack vectors and one of the attack Vector could be money so if you actually truly believe in decentralization you actually truly believe in game theories and meaning that it doesn't matter if it someone is having too much money or protocol having too much money because at the end of day it means that your system is wrongly designed so if you if you um argue that me or flashboard or whatever makes the system weak it's not actually the fault of the me is the fault of the system being wrongly designed because at the end of the day a strong design a strong system is a system that doesn't get scared of any external actors but that's because you bring game theory in like the whole point of blockchain no it's not no it's not like game theoretical security is clearly so you miners miners are actually mining the block because they they care about value of the block I mean value in the sense of non monetary value but it's just because for the for the for the art of mining like to finish my sentence that I would advocate for cryptographic security over cryptoeconomic security wherever possible blockchain doesn't work because of mathematics it works Blain also works of mathematics and for example if we talk about ZK Bridges 50% of M 50% of G Theory so if we talk about for example ZK Bridges being clearly Superior to you know more game theoretically uh you know protected bridges that is a clear example of something where cryptographic security where you prove that something works is by definition way better than a system that is secured by you know cryptoeconomic security do you agree to that it depends to um how do you scale on a like ZK light Cline Bridges you scale by you know just making faster proving system by improving this cryptographic building blocks yeah but the point is like the blockchain operates for thanks to crypto game theories you cannot make it just purely operating from ZK mathematical proof you have to have a network to send the distribution of those proof and whatever to run the network otherwise you cannot communicate between each other that's right so you cannot scale that's right money we should limit the impact M you incentivize people to stay here better than ha you system but once one way is to say otherwise I can just go to your computer and hack it and I'm incentivized to do so to break in your house because I knew you have 10 billion in your wallet no but this is a fallacy that's why miners don't leave the network because they incentivized to stay rather than Fork go someone else it's a fallacy to say because we have no better cryptographic building blocks we need cryptoeconomic security and that's what we have today and then you're leaning all the way and then say bring this for everything no don't let's try to reduce the money and build better systems over time and not use the lazy way out because to me the lazy way out is going for like you know weaker trust assumptions and I want to go for stronger trust assumptions that protect the individual more and I think we can do that and luckily there's a lot of really smart people in this space building that and I think you know we should keep the keep the gold po high for them and let them build this crazy stuff which makes the world objectively better so um it's it's you know it it it it's clearly a difficult goal to to go after uh decentralization um is it still a worthy Pursuit should we like like even if we assume we can't get there should we still gun for it I think it's like it's um again it's not like it's because of a French accent I think it's more like a a religion it's more like it's a past to it's it's a way of living it's a lifestyle and then because of this lifestyle we actually doing and trying very hard to pursue that goal um but by nature or like physically speaking or mathematically speaking or whatever you you call it I'm not sure true decentralization can actually exist because of how Society is built Society is built on fighting enthropy and you know yeah so the the point is like in term of like medum or long-term Bas like long-term plan potentially possible but then you have ai and all different players so what is actually true decentralization in the world where human being doesn't actually care or uh so I think it's for us we we ra like project like look how many l2s like do we actually need them do do we need all the different things it's it's it's a tough question do most of the product that ra a lot of capital there for token they don't actually need to use a token and and they're not actually creating value and they're not actually making money so but it helps trying to work really hard towards building and shipping and and trying to crack new type of Technology CU for example like ZK have been around for a long time in in fundamental mathematics but the only way that they were being made applicable in the commercial way was thanks to crypto and blockchain you know the reason why we we there was some research about people having those um beautiful piece of uh of Hardware like software uh uh phones and Etc the the the the you know the industry that made this possible if you look at U is a one industry is actually gaming because of people pouring so much Capital into games that Nvidia graphic cards and and GPU CPU were actually forced to innovate on trying to minimalize and trying to accelerate the technology so this is the pouring of capital that was actually made possible the advancing of technology and now because maybe of AI that's the reason why we have ai maybe because of the gaming industry back then throwing a lot of capital so I think this calization is also a meaning for yeah let's try to make those piece of mathematics fundamental mathematics commercially way and maybe we can solve some big problems yeah I mean to me to answer it yes we should clearly pursue it by all means and no it's of course not a lifestyle you know what is a lifestyle a lifestyle is to say I need to get to $200,000 as quickly as possible that is lifestyle decentralization is technology that makes the world a better place it does but I'm saying in practical way well we we are over but I love the energy that you guys brought to this Pan um firesight uh thanks everyone for attending and thank you too thank you thank you everyone