Good morning everyone. Thank you very much for being with us. My name is Tim Beo, and for the past eight years I have been working on research and development of the Ethereum core protocol. As Karlik says, I was partly involved in helping coordinate network updates that brought features like EIP559, the merge roadmap, or Ethereum scaling, from research to production. And it gives me a really deep understanding of what makes Ethereum so special.
Its permissionless nature permissionless nature , immutability, and 100% , immutability, and 100% uptime make it a reliable layer of settlement for everything from money, markets, coordination, and more. A few years ago, when we were studying protocols a little more broadly, we came up with a term to describe their uniqueness – their uniqueness – unreasonable sufficiency. We meant that well- designed protocols are designed protocols are usually deceptively simple, but allow for complex interactions on top of them. Ethereum is a great example of this. Achieving consensus on a relatively small virtual machine has enabled trillions of dollars in on-chain economic activity.
So for a long time, the question that kept me up at night was whether Ethereum could become a planetary- scale infrastructure without sacrificing what makes it special. And today it's clear to me that it can. Over the past few years, we’ve seen things like zero- disclosure proofs and data availability sampling move from far-fetched research ideas to production software that actually powers the chain, helping it scale without compromising security or decentralization. This means that we now have a more difficult question to answer. If Ethereum can work on a planetary scale, what should we use this protocol for?
My thesis is that for Ethereum to truly succeed, it must provide the world with what it needs but can't get elsewhere. And these things should also leverage Ethereum’s unique properties. If Ethereum doesn't provide what the world truly depends on, then at best it will simply become a niche open source protocol. On the other hand, if he does, but these things also don't depend on Ethereum, then we risk our most valuable use cases being unbundled. So the most ambitious way forward is for forward is for Ethereum to become a substrate for commitments that the world can't coordinate anywhere else.
In other words, the question I'm trying to answer is, how do we move from an unreasonably sufficient world computer to a reasonably necessary one? That's what I want to talk about today. Hmm, so first let me explain why I think it's really important for Ethereum to provide these features that the world needs. In short, it's because Ethereum's most fundamental properties fundamentally contradict existing power structures. Permissionless access, immutability, censorship resistance, and decentralization mean that mean that anyone can own assets, enter into long-term agreements, coordinate actions without the approval of any third-party trust board, and do so without being locked into the system or having the ability to stop Ethereum from being used by anyone, as the last 10 years of continuous operation have shown us.
This allows Ethereum to change domains that have historically been mediated by large institutions and governments. Things like markets, identity, calculations. This is what makes it incredibly powerful, but it also means that its tolerance in the world is not guaranteed. The more Ethereum weighs in these areas, the less inconvenience existing players will create there . So, the strongest path for Ethereum is to become so useful that suppressing it is simply more expensive than tolerating it.
Sorry, it's more expensive than tolerating it. Hmm, and one way to emphasize the importance of this is to consider two different ways this could pay off. The first is a pay off. The first is a cautionary tale. If you look at something like the pirate bin, even though file sharing was really useful, really useful, and embraced by millions of people, torrents never became an infrastructure that the entire world was structurally dependent on.
Hmm, the most popular use cases like movies and music were actually moved to more centralized alternatives that were more user-friendly and more aligned with existing institutions. This didn't mean that Pirate Bay or anything like that had disappeared. It simply means that they still exist, but as niche tools, not as global technologies. I hope Ethereum can achieve more. At the other end of the spectrum is something like TSMC.
This is a company whose ability to produce advanced chips on a large scale is so critical to the computing supply chain that the entire geopolitical order is reorienting itself around it. Structurally, TSMC is the polar opposite of Ethereum. It relies on a multi-billion dollar physical centralized infrastructure and extensive trade secrets. But strategically, I think this is the level of ambition this is the level of ambition that we should have that we should have . Ethereum must offer the world something so unique and valuable that suppressing it would be costly and inconvenient even for the participants themselves .
So, it is not enough to create something valuable for the world. Applications can run on Ethereum without necessarily being dependent on it. If the underlying value does not depend on Ethereum, then these applications will be rebuilt or moved elsewhere. Whether it's another blockchain, a private network, or, sorry, a traditional database. This doesn't mean that these applications are bad, but it simply means but it simply means that Ethereum is just a conduit for their distribution.
Stablecoins and real assets are examples of this, right? They generate activity on the web and are obviously extremely useful to users, but they can be issued on many different registries and represented in many different ways in traditional databases. If users only want access to these assets, the assets will move to the rails that are cheapest, fastest, and most convenient for them. Today it may be Ethereum, but it is a shaky foundation to build that long-term competitive foundation on. The clearest counterexample to this counterexample to this is probably something like money, right?
If you want a globally accessible, censorship-resistant, sovereign store of value, then Ethereum's features really matter. But if money is the only use case use case that requires all of this, then it's unclear whether we need a full-fledged world computer. I don't think that's true. And I think there are examples that prove otherwise, and it has been that way for many years. So it's worth considering them.
The first one is DeFi, right? Def leverages Ethereum’s shared state and trusted execution to allow to allow anyone to build financial applications without the need for trusted intermediaries. L2 is another huge fundamental building block. They allow us to scale Ethereum applications to a much larger number of users without compromising security. And then the liquidity that we already have in Ethereum allows us to invest in any new markets as soon as they come online.
But these are just the basics, not definitive answers, right? Much of DeFi activity is either confined to the crypto ecosystem or only partially secured by Ethereum, as, sorry, issuers and asset issuers remain the ultimate source of truth for many of them. Hmm, and while L2 them. Hmm, and while L2 platforms bring Ethereum’s features to a much wider range of users, they don’t really answer the question of what these people will ultimately use Ethereum for. And finally, you know, liquidity has historically been low for Ethereum, but it's only really a moat when the things that generate its revenue depend on the underlying properties of Ethereum.
And this is really important because the core features of Ethereum are very expensive to maintain. Permissionlessness Permissionlessness , immutability, censorship resistance, and decentralization don't come for free, do they ? They cost us speed, simplicity, and UX. But these are extremely important things. They are important for Ethereum.
They are important for the ETH asset, for the crypto industry, but much more than that. Like many of you, the reason I work on Ethereum is because I think it has the best chance of becoming the long-term home for these things to exist in the world. But if our best use cases don't depend on that, then we're asking users to pay for protection they don't need, and asking the ecosystem to protect features the world has n't yet learned to value. In that case, the best option for Ethereum is probably that it becomes a starting point for application developers application developers , where people use it because other people are already using it, which is not just a coincidence, but a far cry from a structural necessity. So the bar I want to set for us is higher.
set for us is higher. First, would the world really want what we're creating if it weren't built on Ethereum? And second, are Ethereum's expensive guarantees really necessary to secure what we ultimately create? Only when both of these things are true are we in quite necessary territory? So what actually exists at this intersection?
Hmm, that's a very difficult question, is n't it? Um, one of the ways I reframed this for myself is that Ethereum allows users to do things that other systems don't allow ? I've spent some time reflecting on this over the past few months, and there are a few things that have struck me. Within fixed domains, right? If you have laws or corridors that exist within a certain legal system, bank balance sheets and financial assets exist within a certain financial system.
Um, but Ethereum offers us a different kind of stability, a public neutral record of what is owed of what is owed , and what are the rules by which it can change. This is really important when claims are to be recognized in the future by different entities or in different jurisdictions. And this becomes even more important in a world mediated by artificial intelligence. Agents will be able to instantly negotiate commitments and agreements by developing consensus algorithms consensus algorithms , right? We don't expect them to need to touch the blockchain to do any of this.
And that's fine for one-time agreements, but it's broken when those commitments have to outlive the context in which they were created. So, Ethereum's role is to make these commitments and the rules for changing them strong and clear enough that future participants can rely on them . Another property is property is canonical uniqueness. Hmm, as zero- disclosure proofs become cheaper, more and more customers are moving beyond blockchain, right? You can prove that credentials are valid, that a constraint was met, or that a calculation was performed correctly, without revealing any of this data to the world and again without using the blockchain.
But a local proof doesn't tell you whether there is another statement somewhere that contradicts your proof. This is what blockchains uniquely provide. This is the canonical complete set. Double-spending prevention Double-spending prevention is kind of the monetary version of this, right? If you hold coins at one address on the chain, the blockchain prevents you from sending them to two different addresses at the same time.
But the same pattern generalizes far beyond that. If you need to count all the votes in a DAO, all the claims in a market, or figure out all the rights associated with an asset, that's where a generalized virtual machine becomes critically important, right? The same guarantees you had for this money and double spending apply to all of these use cases. And the third property is programmed trust. Um, outside of blockchains, trust is often categorical.
You are either inside the platform, or not approved by the bank, or rejected and trusted enough for the interaction, otherwise it will not happen. Ethereum gives us a different starting point because you can verify the commitments and rules in advance. You can trust the interaction without necessarily trusting the counterparty. From there, trust becomes gradual, right? You can add reputation, insurance, certification, or equity whenever you need it.
But extreme stress is what extreme stress is what allows us to move from trust as this discrete binary gateway to a programmable dial. And again , this matters a lot in the world of artificial intelligence, because AI will create a huge number of one-off interactions that are either too small for lawyers to assess, too large to rely on existing social trust mechanisms, and too diverse too diverse to rely on a single reputation score. So every interaction requires an individual trust budget. So what does this look like in practice? Um, one way to think about it is that Ethereum's capabilities give builders new laws of settlement physics.
It's like an environment for experimenting with structures that can't be built anywhere else. I like to compare it to space manufacturing, don't you ? Um, in microgravity you can combine materials in ways you simply can't on Earth and produce things that otherwise simply wouldn't exist. Ethereum does something similar, but for funding and coordination. Instant loans are a really good example of this.
Um, in traditional finance traditional finance , if you want to borrow money, you need collateral, credit, a legal agreement, relationships with your counterparties your counterparties . Um, but on Ethereum you can borrow huge amounts of capital without any of that. The reason is that we have atomic execution, meaning when you take a loan in the context of a transaction the context of a transaction , you either pay it back at the end of the transaction, or the transaction rolls back and it's as if the loan never happened. It's not just about making the loan faster or bigger. It's about creating a completely new financial object that is impossible outside of the physics of Ethereum calculations.
I don't think flash don't think flash copies will make the world dependent on Ethereum, but I do think they are valuable proof that we can create valuable and unique things that no one else can. So I think the limit from here is more like figuring out what environments we can create to actually combine these three capabilities in new and interesting ways. This is where the theorem starts to become quite necessary. One option for this could be to transform prediction markets into a risk infrastructure for the world. A single prediction market doesn't really need Ethereum, does it?
You can run it on a centralized exchange or a centralized platform. And for many use cases, this is enough. But if you think of markets as these compositional primitives compositional primitives , something really changes, doesn't it? You can imagine the wildfire market becoming an insurance coverage, the supply chain disruption forecasting market becoming a hedge in a procurement contract. These predictions actually become building blocks around which entire systems can be built .
And the properties of Ethereum are really important here, are n't they? You need a single canonical set of claims, commitments that are robust enough for people to have long-term impact long-term impact , and varying levels of trust for those providing data, pricing your liquidity into the system. And this also goes back to agent coordination, right? On-chain agents will provide signals, price risks, direct capital, create markets, and generally perform a multitude of actions on behalf of participants in these systems. For each interaction, the system must know what the agent is allowed to do.
Um, you know, where does this authority come from, what amount of collateral is at stake, what story should be public and what should be private. And again , this is where Ethereum becomes really useful. Agents can directly inspect these formal systems. They can read rules, verify commitments, and decide exactly what level of trust they want to provide to each interaction, at a whole new scale and speed than we could before. Because blockchain rules can seem opaque and difficult for humans to analyze.
However, for agents, they are a really good interface if the system is reliable. And this is in some way related to what we already have today in Ethereum. So, while this last example was quite speculative quite speculative , I think the Ethereum community is extremely good at turning these cutting-edge research ideas into open, permissionless systems with real value at stake. Hmm, and we already have a super solid foundation for this to exist, right? If we take this example of such risk markets, all the claims that agents would settle and act upon would happen through DeFi, which we already have in Ethereum.
L2 gives us the space needed to scale this, and on-chain liquidity can now be directed towards a new type of native Ethereum alpha, i.e. risk pricing at machine speed. In fact, this cutting-edge stack is based on something that has already proven its work and safety. And it all comes back to Ethereum, a neutral base layer where the most important parts cannot be overwritten, allowed, or ignored.
And so, having spent many years on the protocol side, this is what I want to dedicate my time to now. Finding applications that deserve to run on Ethereum on a planetary scale and helping to bring them to the world. Because if we create things that just use Ethereum, then they will be split and moved to other chains, which won't give Ethereum much stability. But if we create compositional systems where Ethereum guarantees are truly bearers, we start to have a mode of complex accumulation. Each useful primitive makes the shared system more valuable to the next, and the network as a whole becomes harder to suppress or ignore.
This is how Ethereum becomes quite necessary. Thank you.
Automatic transcript — names and jargon may be misspelled.
