21 - Ethereum: Past, Present, Future | Vitalik Buterin

Episode: #21 July 13, 2020 Ethereum turns 5 on July 30th! That's 5 years of history. Five years of progress. Time enough to change the world? We sit down with Vitalik Buterin and walk through Ethereum's past, present, and future. Has the vision changed? Has ETH earned its price? What about monetary policy? How's Vitalik feeling about the future? Is ETH a triple-point asset? It seems clear that Vitalik believes the Ethereum community is its strongest asset. This band of Athenians isn't just here to vanquish foes, it's here to build a digital civilization for the world. Not burn it down. Build it up. Vitalik believes crypto is standing strong as one of the few remaining things that's genuinely international. And as we witness the balkanization of the digital world, the open door to cooperation that Ethereum provides is exactly what humanity needs in order to thrive in the 21st century. Happy 5th Birthday Ethereum! The world needs you now more than ever. We cover: How Vitalik's feeling about Ethereum PAST: Times when Vitalik was far less optimistic Has Ethereum matched the original vision? Identity in an independent digital civilization PRESENT: Does Vitalik like or hate DeFi? Vitalik's biggest concern for DeFi Thoughts on liquidity mining The goods & bads of speculation Have we earned the price? FUTURE: 3 problems we face now Spartans vs Athenians - who wins? Is Ethereum a nation, a religion, a technology? How Etheruem is like Briton ETH THE ASSET Is ETH a triple point asset? Solidifying ETH's monetary policy LIGHTNING ROLLUP ROUND Gas fees are too high? ETH flippening BTC? Low hanging fruit? HIs favorite ETH killer? And more... Join us next Monday for a fresh episode! ----- Tools from our sponsors to go bankless: Rocket Dollar https://bankless.cc/2C57MVW - tax shelter your crypto ($50 w/ "BANKLESS https://bankless.cc/2C57MVW") Ramp https://bankless.cc/2ZDJQRU - the fiat onramp for DeFi (mention Bankless!) Monolith https://bankless.cc/3e2TG4E - holy grail of bankless Visa cards Aave https://bankless.cc/aave - money lego for lending & borrowing ----- Resources discussed: The Ethereum whitepaper https://ethereum.org/en/whitepaper/ Roadmap for Ethereum https://twitter.com/VitalikButerin/status/1240365047421054976 Ethereum's monetary policy https://docs.ethhub.io/ethereum-basics/monetary-policy/ (it's underrated https://bankless.substack.com/p/eths-monetary-policy-is-underrated!) ----- Episode Actions: Review Ethereum timeline https://www.visualcapitalist.com/mapping-major-ethereum-forks/ (up to 2019) Listen to our fave episodes on Ethereum 3 - Economic Bandwidth http://podcast.banklesshq.com/economic-bandwidth 4 - Ether: The Triple Point Asset http://podcast.banklesshq.com/4-ether-the-triple-point-asset 7 - Ether’s Value Mechanisms http://podcast.banklesshq.com/7-ethers-value-mechanisms 20 - The Ethereum Opportunity | Chris Burniske http://podcast.banklesshq.com/20-infinite-whitespace-chris-burniske Give us a 5-star review on Apple iTunes! Also...subscribe to Bankless YouTube https://www.youtube.com/c/bankless to watch State of the Nation https://www.youtube.com/playlist?list=PLmkdAgtxf3ahHup7h1dxjs0SNwCSGdjVb every Tuesday. ----- Subscribe to podcast on iTunes https://podcasts.apple.com/us/podcast/bankless/id1499409058 | Spotify https://open.spotify.com/show/41TNnXSv5ExcQSzEGLlGhy | YouTube https://www.youtube.com/c/bankless | RSS Feed http://podcast.banklesshq.com/ Leave a review on iTunes https://podcasts.apple.com/us/podcast/bankless/id1499409058 Share the episode with someone you know! ----- Don't stop at the podcast! Subscribe to the Bankless newsletter program http://bankless.substack.com/ Watch Bankless shows and tutorials on YouTube https://www.youtube.com/c/bankless Visit official Bankless website http://banklesshq.com/ for resources Follow Bankless on Twitter https://twitter.com/BanklessHQ Follow Ryan on Twitter https://twitter.com/ryansadams Follow David on Twitter https://twitter.com/TrustlessState ----- Not financial or tax advice. This podcast is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Do your own research.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:14Ryan Sean Adams?

  Welcome to Bankless, where we explore the frontier of internet money and internet finance. This is how to get started, how to get better, how to front run the opportunity. This is Ryan Sean Adams. I'm here with David Hoffman and we're here to help you become more bankless. David, we've been waiting a long time for this episode. It seems like, well, 20 episodes. I suppose we've been waiting because this is episode 21. We have Vitalik Buterin on the show. What did you think about this?

• 0:44David Hoffman?

  So banklessness is a journey, right? So it's a journey that we're all going on together. And I feel like the last 20 episodes were really our collective prep work for what we wanted to ask Vitalik. And so we kind of bucketed this conversation into a couple of different camps. We talked about Ethereum, past, present, future, Ether, the assets. And then, and then we had a pretty fun rollups round at the very end. But really what collectively we were trying to get at, and we asked him directly this question, which I enjoyed his answer, and I'll leave that teaser there. But really what we're trying to get at is like, what are these systems collectively? Like what, when we have like the bankless nation and we have the Ethereum blockchain and we have DeFi,

• 1:27David Hoffman?

  and then we have the community, we ask questions around all these different topics. And so it's really a conversation that hits the different points of what these systems are from different angles. And so that's what I really enjoyed about this conversation with Vitalik.

• 1:42Ryan Sean Adams?

  You know, he asked a question at the very beginning and we didn't get a chance to answer his question in the podcast. But I'd love your answer now, David. So his question was, would Ethereum be okay now if I left? It wasn't the case probably, you know, four years ago, but would it be okay now if I left? I being Vitalik. What's your take on that?

• 2:07David Hoffman?

  Yeah, so Ethereum is still in like beta, right? That I think that's the right way to view Ethereum 1.x. Even though we are doing just a massive amount of economic activity and people's lives are being changed with Ethereum 1, we're still in beta. And, you know, people criticize me whenever I say this on like POV CryptoPod or elsewhere, but like, I trust Vitalik, like, I trust him. He seems like a trustworthy guy. And so while these systems are supposed to be leaderless, in this current Ethereum 1.x version, the beta version of Ethereum, where we have this guy who is, is obviously intelligent and obviously has the best interest of Ethereum at heart and is pragmatic in the way that

• 2:51David Hoffman?

  it is both good and bad for the world. I'm glad that Vitalik is here. And so while if Vitalik left now, I think Ethereum would carry itself into the future perpetually, it would be slower. And, and having that leader that where we can rally behind, I think is still valuable in the present version of Ethereum. Now, I also hope that changes and I, and I think Vitalik hopes that it has already changed, but I hope it changes and completely finalizes an independence from any one single person when Ethereum 2.0 is rolled around and completely matured.

• 3:29Ryan Sean Adams?

  You know what it reminds me of is, maybe this is because I just watched Hamilton, but it reminds me of like George Washington, right? Kind of the, the general that led the early republic in the beginning and took a first term as president, but then stepped away. And some people wanted to make him a king, but he stepped away and let the republic govern himself. I think that's what Vitalik is doing in a way is he's, he's gradually been sort of stepping aside and letting other leaders, letting the community kind of fill the gaps of his leadership. And that's been on a steady trend since, you know, 2015. Eventually, I think he'll just step away from this entire thing.

• 4:12Ryan Sean Adams?

  Like you, I think he's, he's sort of a George Washington character in that he's Not here to set himself up as king of anything. He wants to see the success of the Ethereum nation and the Republic, essentially. And, you know, I think it would be in a much better place if he stepped away now than it would have been previously. But it's, his leadership is still super useful now, as George Washington's was in the early days of the United States of America.

• 4:45David Hoffman?

  Yeah, and he also has other interests too, right? Like, he doesn't only work on Ethereum. And I think there's been a more and more emphasis that Vitalik has started to expand his interests into other realms. We didn't really get into that on this episode, but if you follow Vitalik, he's an avid member of the radical markets movement. And there is obvious intersection there between Ethereum and the radical markets community, but it's also separate. And so I think when Ethereum 2.0 rolls around, like, he'll still be present, but I think he would largely, his interests have largely would have moved on to perhaps building something on top of Ethereum, but not Ethereum itself.

• 5:24Ryan Sean Adams?

  Yeah, absolutely. And I think this was a key time to get Vitalik on the Bankless Podcast too, because it's going to be Ethereum's fifth birthday on July 30th. So this is five years. So you talked about Ethereum being in beta. You know, in human years, Ethereum is just a toddler. Like, it's just learned to walk, and now it's getting ready for some preschool. But it doesn't know a lot, and it certainly hasn't grown into what it is going to be as an adult. So, you know, I think you'll find in this conversation that Vitalik realizes that, and a lot of his conversations were about,

• 6:04Ryan Sean Adams?

  a lot of the conversation was about how Ethereum grew up, what its values are, what the future looks like. It's really a fantastic mind that we're speaking to, and it was a fantastic conversation. So we hope you enjoy it. Now, before we begin, we want to talk about our sponsors.

• 6:22David Hoffman?

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• 7:06David Hoffman?

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• 7:23Ryan Sean Adams?

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• 8:06Ryan Sean Adams?

  whatever asset they want in five minutes or less. So this reduces the dropout rate and lets you build products for the real world. Zerion is using it, Ethereum is using it, Taurus is using it. DeFi apps that you probably know and use today are using it. What you need to do is check this out and visit ramp.network to see how easy it is. You can get set up in 10 minutes or less and 100x your addressable market size as a developer. This is like the ultimate growth hack. And when you mention Bankless, they'll on-ramp the first 100K in US dollars for free. So go to ramp.network, mention Bankless, and get started.

• 8:46David Hoffman?

  All right, let's go ahead and get right into the episode with Vitalik Buterin.

• 9:00Ryan Sean Adams?

  We are incredibly excited to have our next guest who needs no introduction. We've got Vitalik on the Bankless Podcast today. Vitalik, it's almost Ethereum's fifth birthday. How are you feeling about things? How are you feeling about Ethereum?

• 9:21Speaker 02

  I feel like it's come really far. And I feel like the Ethereum of 2020 is much more mature and kind of much bigger and very different in just so many ways from Ethereum as it was even two years from now, let alone what it was back in 2015 when the project first launched.

• 9:43Speaker 02

  What Ethereum was just first starting and the project is maybe less than one year old. There was the Ethereum core team, there were the Ethereum developers. Ethereum research was largely myself, Vlad, and Gav Wood.

• 10:03Speaker 02

  There were things happening, but there were fewer things happening. And you could tell there were fewer things happening just by looking at the kinds of things that we would get excited about.

• 10:14Speaker 02

  Just Microsoft announcing that they were doing things relating to the Ethereum ecosystem was just so amazing to hear for the first time. And now that's the sort of thing that we just hear every single month.

• 10:27Speaker 02

  From the technology point of view, I think...

• 10:31Speaker 02

  Just a huge number of things have come so far. So like, for example, on the research side, you know, maybe five years ago, research felt like a very open field in a lot of ways, where we just didn't really know where a lot of the paths that we were taking would lead and what other paths exist. But in 2020, like, it's definitely not close to complete, but it feels like a lot of the territory has been explored and it feels like we kind of have the map roughly laid down. So one example of this is in proof of stake. For example, like, we figured out how to combine together the benefits of a chain-based proof of stake with a more traditional proof of stake

• 11:16Speaker 02

  based on PBFT-like algorithms with the two-thirds thresholds. We figured out how to do a CBC Casper. We've figured out a lot of the economics around like things like weak subjectivity, things like how to optimize a lot of the economic incentives, results in terms of what we can and what we can't do. On the layer two side, we kind of understand how state channels work. We understand how plasma works and we understand how rollups work. And we kind of have an understanding that those are basically the only three categories that can exist, which is kind of amazing. And we have an understanding of, you know, what are the precise properties of each category?

• 12:01Speaker 02

  What are the limits of each category? On the development side, and you know, ETH 2.0 is no longer just a kind of thoughts that keep on getting renewed every three months. It's a code that's been implemented and that has an active test set, at least for the proof of stake side, that I actually think is the bulk of the complexity. On the layer two side, you know, it's not just ideas. We actually have Loopring and we actually have ZK Sync. And we have OMG Plasma, that's, I think, on a test that isn't going to go live very soon. Could be, could be wrong, I forget the details, but definitely kind of

• 12:41Speaker 02

  done, did an excellent job of rising from the grave after it seems like a lot of people are kind of forgot about it for some time. Um, there's, on the optimistic rollup side, things coming out soon. Privacy is much better. ZK Stark Research has just come forward leaps and bounds. And the Ethereum community has done, I think, a great job of kind of cooperating with the and zero knowledge proof and academic cryptography space on that regard. And, you know, now we have the pre-compiles that we've had since Byzantium. For the last couple of years, we have actual running privacy preserving applications like Tornado Cash, for example, and things like Aztec.

• 13:24Speaker 02

  Just the theory around how to make Sinarks and Starks just made a huge kind of hockey stick like leap forward some, somewhere in the fall of last year, when things like Plank and polynomial commitments kind of base systems started to come out. So feels like technological, it's been making huge progress on every point. In terms of the community, and I feel like Ethereum is far more kind of independent of myself, for example, than it was five years ago. Like, I mean, I'd be interested to hear kind of your opinion of like, you know, how much would Ethereum have suffered had I disappeared five years ago versus like if I were to disappear today? Or even two years ago?

• 14:07Speaker 02

  Also, the Ethereum ecosystem has gotten much more independent of even the Ethereum Foundation. So now we have a lot of these other kind of very established companies that are building clients, building applications, just building and doing a lot of things. There is a lot more kind of independent voices in the community and even like projects like ETH Hub are one good example of this. So lots of progress on all fronts. Like I, I feel no longer worried that Ethereum is no longer going to be around a year from now, you know?

• 14:45David Hoffman?

  You also, Vitalik, sound pretty bullish, pretty optimistic about things in your answer. And has that always been the case? Have you always been just as optimistic as you are right now?

• 14:58Speaker 02

  I feel like there's definitely been times historically when I was much more worried. I was much more worried in

• 15:11Speaker 02

  definitely the first half of 2014, when it was not even clear when the sale would happen. I was much more worried. Pretty much through the first half of 2015, when the test nets were taking a really long time and you know, I was, I remember through April, May, and the first part of June, I was kind of sitting in China and visiting the Chinese community for quite some time and people were just wondering, you know, hey, okay, Ethereum is cool, but when's the thing actually going to be released? When's the thing actually going to be released? And then, of course, it got released, but then through the second half of 2015, I was really worried because I was

• 15:55Speaker 02

  just concerned the Ethereum Foundation would run out of money before it would be able to actually finish anything interesting. Throughout 2016, the Dow fork definitely scared me a lot.

• 16:09Speaker 02

  So, end of 2016, the DOS wars scared me a lot. I mean, the price kind of dropping down to like $6 or $7 briefly scared me to some extent as well. And there was definitely a time there when it felt like Ethereum, you know, might just get forgotten.

• 16:28Speaker 02

  So, I've definitely felt scared a lot, but I feel considerably more confident than I did at pretty much any point in Ethereum's history.

• 16:38David Hoffman?

  So, Vitalik, that was an insanely holistic sitrep of the Ethereum ecosystem now. And we kind of want to go in this past, present, future path in this podcast. So, starting with, you know, the past, back to 2014, 2015. How has the current state of Ethereum lined up with what you could imagine it to be back then? Like, when you were writing the white paper before the Genesis block was mined, what did you think Ethereum would produce for the world? And how much or how little has that lined up with reality?

• 17:12Speaker 02

  Well, it depends on when, right? Because at the beginning of 2014, end of 2013, the vision for Ethereum was definitely kind of very broad. And there wasn't like a very specific set of things that I definitely wanted to have happen. And it was jumping around a lot. And, you know, at the end of 2013, I was talking about DAOs and I wrote that three-part series about DAOs in the Bitcoin magazine. Then the idea for Ethereum itself kind of originally evolved from basically a set of patches to Mastercoin, which was a protocol for the thing that in 2020, the cool kids called DeFi.

• 17:53Speaker 02

  So it was, the focuses definitely ended up changing. And there was also some time when I was really excited about like decentralized Dropbox-type protocols. And then, you know, naming systems, stable coins. And so the visions definitely kind of jumped around a lot. But it feels like most or all of the things that I was excited about happening on Ethereum six or seven years ago actually ended up happening or at least being tried to some extent.

• 18:26Ryan Sean Adams?

  So Vitalik, there's this meme about Ethereum being kind of a world computer. And critics of Ethereum will say, "Look, it's not a world computer. It doesn't do storage. It doesn't, you know, it's not fast enough to be a world computer." Can you talk about the world computer narrative? Like, was that the right narrative for Ethereum? You know, or like, what's your take on that?

• 18:53Speaker 02

  So I think a lot of people misinterpreted what the phrase "world computer" was supposed to mean. Like, the intended meaning was not a computer powerful enough for the world's needs. The meaning was a computer that the entire world has immediate access to.

• 19:12Speaker 02

  And the intention was that, you know, for applications where the entire world needs to see the process and see the outcome, you would do it on the world computer, but there would be lots of things that do not have that requirement. And so you would do them on all of the other computers that exist today. Now, obviously, a lot of people didn't interpret it that way. And I think it's very reasonable to argue that if you create a meme and that meme gets misinterpreted to hell by everyone, then that meme was a bad meme. So that's totally fair criticism.

• 19:46Ryan Sean Adams?

  Do you think there's something, do you think there's something to the meme of Ethereum being a world settlement computer at least? Or some kind of a, you know, world coordination system, you know, a public good for property rights?

• 20:01Speaker 02

  Maybe. So one of my kind of causes for a bit of hesitation around some of those kind of finance oriented terms, whether it's like settlements or even property rights is that there's a lot of non-financial use cases of the Ethereum blockchain. So even E N S, for example, and you could argue that, you know, the transfer of an E N S name is technically a kind of settlement. But generally, people in the domain namespace don't really use that term. Like that term is more specifically a finance thing.

• 20:41Speaker 02

  And there's applications around, you know, account management and like reputation and like certificate registries and all of those things that don't even have to do with property rights at all. And I want to kind of preserve, you know, the idea that Ethereum is a platform for all of those things too. So I feel like kind of designing the narrative of like what Ethereum fundamentally is as being like entirely around finance could kind of risks marginalizing those other use cases. And world computer, and one of the reasons why a lot of us liked it is definitely that it's kind of much more accommodating of those things.

• 21:24Speaker 02

  But then I guess you could argue that it kind of runs into the opposite flaw, which is that it under emphasizes the financial use cases and it's not clear how, you know, a computer is relevant to kind of creating the next world economy. So. I don't know. I think Ethereum's narrative is ultimately pluralist and there's no single slogan that does an excellent job of capturing what it's about.

• 21:48David Hoffman?

  So I would like to make the argument that while there are plenty of non-financial use cases of Ethereum, those non-financial use cases still are like financial adjacent, right? So like E N S, the namespace system on Ethereum really is just allowing, or could just be viewed as a system that allows for finance to just go better, right? Like send me die to David Hoffman dot ETH, right? That's just way easier. And any Ethereum that uses a system as like a land registry is still using Ethereum as like a value settlement systems, right? And so I would still present the argument that the L1 chain is still going to be like the financial layer.

• 22:32David Hoffman?

  And perhaps the less dense, the less weighty economic transactions are kind of pushed off to the L2. Does that resonate with you or do you see it differently?

• 22:43Speaker 02

  Hmm. I guess there's definitely a lot of use cases that are financial adjacent. And then I would say there is legitimate use cases that are kind of far enough from finance that it's more reasonable to call them not finance than it is to call them finance. I mean, even just one example of this that I sometimes talk about is like, I talk about a lot about like accounts with social recovery, for example, right? And how I think that a lot more people should be using like smart contract wallets with social recovery as a way of storing their crypto. And I actually think that this is a use case that could apply not just to holding cryptocurrency,

• 23:24Speaker 02

  but also potentially even as your kind of primary identity that you use to sign into websites, right? Like I want people to have smart contract wallets that they use to log into like even the centralized web platforms that are going to continue to exist. And I've been kind of increasingly bullish on this use case recently, just because I've kind of learned more and more that the existing centralized and of access control and access recovery mechanisms are actually surprisingly terrible. Like, you know, you think that, oh, there's a company in charge and so there is people that can help you kind of solve your problems if anything bad ends up happening, but I just know so many people that have problems with, you know, Google accounts or Twitter accounts or whatever else and

• 24:08Speaker 02

  the process of getting those accounts back is just a nightmare and sometimes they end up not succeeding at all. And so if instead of having a single company control your identity, then you know, your identity would be a smart contract and that smart contract would have rules that say, you know, here are the five people that can uh, kind of recover your account and then you use whatever cryptographic key that that is stored in the smart contract to sign into things that you have the ability to change your cryptographic key inside the smart contract. Um, so that's a kind of use case which seems but pretty far from finance if you think about it that way. Um. Now, I definitely do think that especially now those use cases are in the minority, um, and

• 24:51Speaker 02

  in the short term future, those use cases are going to continue being in the minority. They uh, and a big part of that is basically just because uh the transaction fees are high and when transaction fees are high, finance is the only thing that's still willing to pay them. But in the long run, especially after we have things like rollups or sharding that or rollups and sharding even that equation could change. So we'll see.

• 25:17Ryan Sean Adams?

  On the topic of identity, do you think Ethereum will make progress on that or crypto writ large on getting good even decentralized identity into these crypto systems?

• 25:30Speaker 02

  So what people call identity, I tends to try to split up into three separate problems. Right? So the first problem is account access control. So basically if I right now declare that, you know, I am Vitalik, um, and I create some kind of

• 25:53Speaker 02

  Ethereum account or name or whatever that represents this identity. Then I just wants to have the ability that I in the future will continue to be identified by Ethereum, whatever systems I interact with as being Vitalik, right? And if I choose to call myself Fred, then I'll keep being identified as Fred. If I identify as a three-legged toad, then you know, the system would still continue to say that I'm a three-legged toad. Right? So the point is not about kind of who you are in some real world sense. It's about kind of persistence of identity.

• 26:32Speaker 02

  Basically that the actor that performs one action is the same as the actor that performed these other actions. And that's basically the something I'm very bullish about smart contract while it's really improving on. The second identity problem is what I call the unique human problem, right? So basically just proving that some particular account represents a unique human. So it represents a human and not a robot and one human can get only one of them. Or at least it's hard for a human to get a lot of these identities. And this sort of thing is really important in applications like Gitcoin, quadratic voting, for example. It's important in like basically any voting system.

• 27:13Speaker 02

  It could also be useful as a form of kind of anti-sibyl and spam prevention. And there's a bunch of projects that are doing this and I think BrightID is interesting, for example. And then I know there's also all the centralized alternatives. So it feels like a Gitcoin is turning into a platform that will just be forced to experiment with a lot of these things, which is really interesting. And then the third aspect of identity is basically proving or attesting to claims about other identities and them being able to prove that some attestation has been made, right? So I want to prove that I am recognized by the government of Canada as being a citizen.

• 27:55Speaker 02

  I want to prove that according to this entity, I have some particular age or that according to this. University, I graduated from them and things like that, right? And those use cases are inherently centralized to some extent. So there's a limit to how much you can decentralize them. But you definitely can use blockchains as a kind of base layer for basically kind of managing these identities and figuring out what all the different cryptographic keys are and creating infrastructure to do things like zero dollar attestations, for example. So I think there's definitely room for blockchains to help in a lot of those areas, too. It'll take time.

• 28:35David Hoffman?

  So when the, hopefully the Ethereum blockchain, but some blockchain, solves this, the problem of identity, right? And we start to have like a social recovery system or simply contracts that represent people. It really, that just seems like the basil layer, right? Like the very first building block for what hopefully becomes a larger social graph, right? So, you know, the way, the way society works, the way we work as members of a community is that we have, like, we are nodes and then we have our connections to our family members, our friends, our business partners, like people that we trust. And then that as a web spans out and ultimately reaches the whole world, right? Except it's not really defined, it's very loosely defined.

• 29:18David Hoffman?

  It's, it's, it's not really instantiated anywhere. And so what I'm, what I'm, I think you are trying to illustrate is that perhaps one day, this, the actual relationships of people is somewhat like codified or instantiated in the Ethereum blockchain. And me and, me and Ryan here, we, we talk a lot about like the bankless nation, like they, an online digital nation, digital civilization that is independent from any nation state. And it seems like solving the identity on, on a blockchain system will allow us to have these social representations inside of this digital nation, this one single global platform.

• 29:59David Hoffman?

  It, it, is that, is that, is that kind of where we are going with this whole identity thing on Ethereum?

• 30:05Speaker 02

  That's definitely kind of one of the worlds I'm looking forward to trying to see if we can create.

• 30:12David Hoffman?

  And then, how much, how much progress do we need to make to get there? How far off is this problem?

• 30:18Speaker 02

  I mean, quite a bit. I think it is something that has to be kind of approached incrementally. And the challenge is that it has to be approached incrementally in this way where every individual step that we take is itself useful, so that people are willing to take the step. Like, people aren't gonna be willing to, you know, just sign up for IDs because they're excited about getting IDs, and people aren't going to be willing to, you know, provide information about some social graph because they're excited about webs of trust. Like, you'll get a few people, but you're not gonna get enough of a network effect. Whereas if you're tying the whole thing into even just something like Bitcoin grants being one example,

• 30:58Speaker 02

  or into some other system where you can get concrete benefits for participating, then, you know, that could actually be used to bootstrap the ecosystem. And once the ecosystem has been bootstrapped, you can try to take it further and try doing other things with it.

• 31:15Ryan Sean Adams?

  So Vitalik, we talked about the past, and that sort of bled into an interesting conversation about identity. I want to talk about the present of Ethereum right now. So, five years old, it's 2020. One of the big use cases, of course, is this DeFi thing. That's always been present, since kind of the beginning of the white paper, there were DeFi-type use cases, though we didn't call it DeFi back then. Now we have a meme. What's your take on DeFi? Do you like it? Do you hate it?

• 31:44Speaker 02

  Um, some of both. And I think there's definitely a lot of DeFi applications that are just really valuable and essential. Like, I would consider stable coins, and especially crypto-economic stable coins, so things like DAI, and now there's RAI and some other ones coming up, as being like, DeFi and being really valuable. I would say decentralized exchanges, Uniswap, has also been extremely valuable. And I hope that we can see synthetic assets representing things other than dollars. You know, major stock indices, a couple of other fiat currencies would be really nice to have. Prediction markets are technically DeFi, and it would be really nice to see

• 32:29Speaker 02

  prediction markets get more widely used. And there's definitely also a side to DeFi that feels like it's sometimes kind of gets into more speculation than than value and more kind of short term than long term. So like, for example, the recent kind of yield farming craze, right, where, as I understand, the yields reached over a hundred percent annualized for some amount of time. Like, what what happens there is basically that Compound created a promotion where they would basically just gift to Compound tokens to people who would kind of put their liquidity into the platform.

• 33:14Speaker 02

  And the result of this is basically that people kind of ran and threw their token, all of their assets into the platform and started kind of collecting these fairly high interest rates. But the reality is that those interest rates are not reflective of anything that's remotely sustainable, right? It's just a temporary promotion that was created by printing a bunch of Compound tokens and they can't just keep printing Compound tokens forever. So if, like, in the long term, I definitely don't think that DeFi is going to give like flashy double-digit interest rates of any kind, right? And in the long run, I expect the DeFi interest rates to converge to being something much closer to just being the traditional financial system.

• 33:57Speaker 02

  So I, yeah, I mean, I do think there is kind of an element of trying to kind of rush for these things that seem like they're very lucrative, but actually they're just short-term opportunities and they're not actually going to scale into something that's really meaningful for tens of millions of people. But, you know, I guess people wants to do weird things with money and so that side of the space is just. Going to keep existing, uh, yeah.

• 34:29Ryan Sean Adams?

  Yeah. So, so the, the common thread, it sounds like in the things about DeFi that you like are they're more crypto economic and they're more long-term oriented and building and less sort of speculative, less mania oriented, let's call it. Now, th- there is a argument about the liquidity mining side of things and the yield farming side of things. That though there is a speculation aspect to it, of course, um, and it could easily and maybe already has already turned into some kind of a mania. It's different than the ICO mania because in the ICO mania, what we had were tokens. That were really sort of, you know, they call them futility tokens, right? They didn't have a value accrual mechanism.

• 35:14Ryan Sean Adams?

  But it could be argued that some of these tokens like, uh, comp, uh, like, like balancer are going to add. Value accrual mechanisms in the same way that maker has a value accrual mechanism. Do you think that's healthy, that the assets at least are healthier from a value accrual perspective?

• 35:32Speaker 02

  I love how you, uh, in a call referred to utility tokens as a few utility tokens. By the way, that's great.

• 35:39Speaker 02

  Uh, and the economic model is definitely like. It's unsustainable, but it has less downside risk from an economic point of view. I think the main downside risk I'm concerned about with DeFi is a smart contract risk. So either smart contract bug risk or oracle risk of some, uh, uh, type. Basically, you know, if you have like 600 million dollars or whatever it is inside of these systems before they've been. Really well audited and they're ready to accept those values and, uh. Either it turns out there is a bug in the contract or it turns out that, uh. You know, the oracle gets attacked somehow, then that could be a really big problem for people.

• 36:22Speaker 02

  And I do think that people should kind of keep some of these risks in mind, right? Like I remember people saying things like, oh, you know, if you have your dollars in a bank account, you get 2%, and if you have your dollars in DAI, you get 4%. Look, it's double the interest rates and it's amazing. But the reality is that that extra, you know, that 4% is only a good deal if you assume that the risk of Maker Dow was a system breaking is less than 2% a year, right? And if you're a risk neutral, I mean, if you're risk averse, then you would want to be even more even more conservative. You'd want the risk to maybe be less than 1% a year or less than half a percent a year or something like that.

• 37:01Speaker 02

  So the the question is, you know, do you actually think that the risk of Maker Dow breaking over the course of the next 12 months is less than 2%? Maker Dow has done an excellent job of surviving these last two and a half years with

• 37:21Speaker 02

  basically no losses to DAI holders, right? It's survived a 93% loss in the price of ETH. It even survived a, I think it was 55 or 60% loss in the price of ETH over the course of a single day, which is just really amazing. So it's definitely shown some sturdiness, but has it shown an expected lifetime of more than 50 years?

• 37:44Speaker 02

  It's less clear. So I definitely think that that's something that people kind of should be careful about and people should just remember that, you know, these kind of background risks of systems just breaking for weird, unknown reasons is something that does continue to exist. You know, even though, yes, Maker and these other projects have done a lot of work in formally verifying their stuff and they've done vastly more due diligence than the Dow did in 2016, but, you know, even still, like, claiming that a system is expected to break less than once in half a century after that system has only been in operation for two and a half years is something that requires a lot of confidence and it's not clear that

• 38:29Speaker 02

  we can justify that high level of confidence yet. So I guess I continue advising caution in that regard.

• 38:41David Hoffman?

  So Vitalik, you talked about how the very strong APR of Compound with this liquidity mining thing worried you, right? And perhaps it illustrated some sort of mania going on, especially as the comp token rose to where it is now, which is almost a $2 billion market cap, you know, right out of the gate. However, I would like to pitch an equal and opposite view where this excitement over the comp token is a great tool for decentralizing the Compound system, right? So the comp token is now the thing that represents ownership over the Compound protocol. And this excitement about comp and the liquidity mining around

• 39:23David Hoffman?

  comp is all about people like this nebulous set of stakeholders who are adding liquidity to Compound. They just really, really want to get the comp token, which is why the comp token price is so high, because of all the excitement that the comp token has generated, because people are really excited to get their hands on the governance token, which is the way that the Compound protocol moves from a protocol controlled and operated by Compound Labs to controlled and operated by this nebulous set of people that own the comp token. And so is that a fair take to have about like the mania, the goodness of the mania surrounding the liquidity mining and then the comp token?

• 40:04Speaker 02

  Yeah, liquidity mining is definitely just economically a really interesting concept. So like, in general, one question to ask is, if someone is being paid in one token, and they want to have another token, right, then a spherical cow economic model generally says, well, they'll just sell that token and they'll buy the other token, right? A spherical cow economic model would say, it doesn't matter in which currency you pay someone for a service, because they will just immediately go ahead and trade that into like having the portfolio allocation that they wanted to have anyway, which is completely independent of your choice of like what thing you want to give them. And

• 40:49Speaker 02

  even if you lock the tokens, then you know, they could still just like cancel that out by buying a like shorting it in some other finance, like DeFi financial derivatives platform. And in reality, of course, that often doesn't end up happening, right? And defaults often end up being sticky. And it turns out that if you just like throw a token into people's hands, then people often do actually end up keeping it. And if you just throw a token into people's hands as a byproduct, then you do end up kind of putting it into more people's hands than you would.

• 41:29Speaker 02

  If people had to actually proactively go on Uniswap and buy that token themselves. So just as a kind of default based system, it's kind of really interesting. And I do think that there's a limit to kind of how much liquidity mining is sustainable. Like I think that if your liquidity mining system is one that basically makes the kind of de facto fee of using the system negative. So it gives you more than you're paying in fees, then that easily turns out to something that gets exploitable. Like basically the equilibrium there is just you would have people that have lots and lots of money, just put all of their money into your system.

• 42:09Speaker 02

  And then they collect the rewards and they just immediately sell all of their tokens because they don't actually care about the application. They're just a kind of amoral, you know, money making yield farmer. And so you don't actually kind of get the community and the default benefits beyond a certain point. But I think that if you create a more modest version and you say, you know, yes, this DeFi protocol has a fee of 0.3%. But you get the, you know, 0.2% or even the entire 0.3% back, but just denominated in this protocol token.

• 42:49Speaker 02

  And yes, if you want, you can go sell it on Uniswap, but you know, by default, you're just going to keep it and you're just going to slowly turn into a kind of citizen of the protocol. Then that's actually a really interesting community dynamic. And also I definitely kind of. Feel like you have to have some sympathy for protocol creators because like protocol creators want, I think, to have decentralized token distributions and making a decentralized token distribution is hard. Like before you had sales and now it's illegally risky to have a sale unless you have the sale in a way that's fairly centralized. I mean, be- before you had airdrops, but airdrops and they're giving a lot of kind

• 43:32Speaker 02

  of money away for free and it's not necessarily clear how effective they are. I do think they can be very effective in some cases, but they do have to be designed fairly well. Uh, so.

• 43:45Speaker 02

  And then there's obviously distributing coins, that kind of per person, but that just gets back to the whole discussion about identity systems. You know, I don't know. I think, uh, like, I, there is a lot of kind of challenges that people that are trying to make these new projects face. And so I do think that we have to kind of have a bit of mercy toward them and a bit of forgiveness toward models that aren't perfectly optimal. Uh, but. And so I guess liquidity mining is definitely interesting, but it's also not the end and I kind of look forward to seeing what other things people come up with.

• 44:19Ryan Sean Adams?

  Yeah, well said, and intent certainly does matter. I think there have been times when scammers with ill intent just use these sorts of things to scam people. Uh, and, um, you know, it remains to be seen, I guess, what the intent is of these DeFi protocols, but, um, I, I think it's promising. But you, one, one thing you mentioned earlier, Vitalik, was advising caution, both about smart contract risk and interest rates and kind of the speculative mania that's, that's growing about these tokens. Um, you advised caution in 2017 too. Uh, I'm not sure people listen to you. Um, or maybe some people did, but I, I guess my question is like, humans are bad with risk and they're going to speculate no matter what.

• 45:02Ryan Sean Adams?

  There's always going to be another speculation. David and I tend to think that we are on the edge, perhaps, uh, the very beginnings of another speculative bubble that might be coming down the pipe, you know, maybe, maybe soon, maybe the next, uh, you know, months or a year or so. Is there an upside to all of this speculation?

• 45:21Speaker 02

  There's definitely an upside to speculation. Like, I think the usual line is that bubbles tend to be bad for the participants, but they are or tech bubbles tend to be bad for the participants, but they're good for society because, well, they basically fund public goods, right? So, you know, with public goods, the line is that kind of rational, self-interested agents end up under-investing in public goods because they only get part of the, a small part of the benefit from their contributions. But if you take crazy agents who overrate the effect of the, of things that they're participating in, that that kind of ironically ends up cancelling out for the other economic bias.

• 46:03Speaker 02

  And so you get something that's kind of strangely enough closer to being socially optimal. So, that's an interesting argument. I mean, I do think that's one of those kind of dangerous arguments, because if that's something that you tell yourself to make yourself feel better, then you could end up creating, creating or contributing to kind of bubbles that end up really hurting a lot of people and just making it some insiders rich in the process. And you kind of still think that you're being virtuous all the way through because like, hey, it's somehow funding a bit of protocol development in the backend. So, like, you definitely have to be, you know, careful about the moral justifications that you tell yourself in that regard.

• 46:45Speaker 02

  But, and there's definitely a kind of real positive benefit, right? Like, you can't deny the fact that just the crypto mania up until now has funded important things like ETH two client development, zero knowledge proof research, Ethereum one and kind of 1.0x client development and all of these other things that the Ethereum Foundation and a lot of other groups in the crypto ecosystem have ended up spending their money on. Also, a lot of kind of non-crypto charities that ended up benefiting from donations from just people who got kind of crypto rich in 2017.

• 47:25Speaker 02

  Like, and I made, I made a few myself, but then there was the pineapple funds that threw around to kind of even more, even more money. And that's probably something that's led to a lot of good. So, like, you definitely can't deny that those positive consequences have happened, but. Yeah, at the same time, like you, you have to be careful and kind of avoid that turning into this kind of self justification story that you keep telling yourself and you keep on telling yourself more and more until at the end that you don't even realize it, but you're no better than Tron. So, yeah.

• 48:01Ryan Sean Adams?

  We definitely want to be better than Tron here in the Vanquished Nation Vitalik. And, you know, I, I, I, I hope we're doing a good job of that.

• 48:09Speaker 02

  That's, that's good to hear.

• 48:10Ryan Sean Adams?

  Yeah, one more case on for speculation, though, is, is, is also this.

• 48:17Ryan Sean Adams?

  Doesn't it bring users into the space, new people into the space? We're going to have a global financial or settlement or, you know, computer system for the world. We need more people. And just about everyone I know that is maybe not a developer came to the space because of some price run up. Right? Like just it, you know, it captured headlines. That's how they found out about it. That's how the information was disseminated. That's where they initially came to the space. Now, the people who really understood what it was trying to achieve tended to stay after the bubble popped. But it, it tends to bring people in, in these waves. Is that an upside too?

• 48:58Speaker 02

  That's definitely an upside. And I think the money aspect of crypto is definitely a big part of the reason why it has been so successful at getting users where a lot of the previous efforts at decentralization have failed. And also I think that just the fact that it's risen in price is something that just gives it all, gives crypto a lot of status. Like I think a lot of people kind of underestimate, especially in kind of across, across the entire range of cultures that exist in a global context, just kind of the extents to which that financial success kind of brings a kind of legitimacy that would otherwise not, not exist in a space.

• 49:45Speaker 02

  And so, you know, we've been seeing just crypto as a thing become really successful in a lot of regions around the world, you know, there's like kind of the US and Europe and there's India, there's like China and Korea and other places in Asia, there's.

• 50:04Speaker 02

  You know, South America and Africa and in a lot of those places, uh, kind of the, kind of, the memes that, uh, that attract a lot, uh, kind of many US people to, uh, to crypto were, are definitely not as prevalent by default. And so the kind of the legitimization function that comes from the fact that crypto is, uh, kind of financially successful has definitely been important in, uh, kind of that, that more global context as well. So, you know, there's definitely benefits, though at the same time, there's a lot of risks, right? And the risks basically come because, uh, you know, not every member that joins your community is a net positive contributor, right?

• 50:47Speaker 02

  And a lot of the time, people that are there for just the money, unless, uh, you know, kind of you can manage their presence well, can easily end up being net negative contributors. Uh, and I mean, I feel like in a lot of crypto communities, we end up seeing that, right? In the crypto communities that kind of really strongly emphasize the money aspects, like the, the community just ends up being about speculation and people come in about, you know, hey, the coin's gonna go up and the coin's gonna, uh, gonna go up even more and this is the reason I'm excited about participating. And those kinds of communities tend to be short term and they tend to just not create much value for the world and the, and

• 51:28Speaker 02

  it can easily kind of slide down a dark path toward being an even worse kind of MLM sort of thing. Uh, so I think that it is also important for us as a community to just, uh, kind of keep, uh, kind of talking and keep signaling about how we're not just about that. Um, and you know, like, a lot of people do, are, kind of do sometimes, I kind of think of virtue signaling as though it's something kind of dishonest and it's, uh, it's a bad thing. But there's a lot of times where virtue signaling is good, right? There's a lot of time where you really want to just kind of publicly state, you know, these are the virtues that our community is about

• 52:12Speaker 02

  and, uh, these are the, uh, kind of, the kinds of, uh, traits that we want to, uh, that we want, uh, kind of this, uh, cluster of social space to be a magnet for. And these are the things that we want, uh, our, kind of, social cluster to end up repelling, right? And if you End up dealing with things that are double edged swords and you there's often cases where you know you can try to kind of build the community in such a way that it kind of attracts the positive end of the sword and it repels the negative end of the sword. And of course, they're ultimately two ends of the same sword and so they're not going to be further apart from each other than the length of the sword. Okay, crap, now

• 52:55Speaker 02

  I'm mixing sword metaphors and magnet metaphors. You know what I'm talking about. But like there's a lot that you can do, right? So I think there is kind of there's definitely these kind of complicated factors that interplay with each other and this kind of complicated task of just this collective effort of kind of steering the culture and continuing to make sure that it goes in good directions and that it kind of continues to stay true to its original intentions. And I feel like in a lot of those cases, we have been doing fairly well. And yes, we just have to keep on making that effort.

• 53:36David Hoffman?

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• 55:02Ryan Sean Adams?

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• 56:07David Hoffman?

  So Vitalik, in 2017, maybe it was very early 2018, you wrote a pretty famous tweet about how the valuations of these cryptocurrencies, crypto networks, crypto applications were just far beyond the value that they were actually providing to the world. And you posed the question of that, you know, the cryptocurrency blockchain Ethereum Bitcoin world hadn't actually provided all that, hasn't really achieved all that much. And the valuations that are currently going on in the crypto world were not reflective of the value that they deserve. Now that we're three plus years later, three and a half years later from that mania, have we gotten to the point where you would have hoped that we might actually deserve some sort of, you know,

• 56:52David Hoffman?

  I'm not going to, I'm not going to ask you to make some sort of prescriptive statement as to what the values of these networks should be. But the value that you see Ethereum providing to the world, is that kind of what you were hoping we would have been able to achieve back in 2017?

• 57:10Speaker 02

  It's two and a half years, not three and a half years yet, by the way.

• 57:14David Hoffman?

  Pardon me?

• 57:16Speaker 02

  I think so. And I think like the price of Bitcoin is down by a factor of two and the price of ETH is down by about a factor of five. But I think, you know, the resilience of the Ethereum network and the amount of progress that the Ethereum ecosystem has made is easily up by a factor of five since two and a half years ago. And as I mentioned, you know, at the beginning of our conversation, you can see this by looking at the technology. You can, you can see this by looking at the research. We can see this by looking at what's actually been deployed. You can see this by looking at just what kinds of things are being built on top of Ethereum as we speak. And the amount of progress is huge.

• 57:59Speaker 02

  And also, I feel like just the presence of Ethereum and crypto in general as being just kind of a thing that's cemented itself as a durable part of a kind of the collective cultural conscience, I guess. Kind of even just of the broader world is something that's come much further lately. And like, I regularly talk to a kind of fairly mainstream economists, kind of increasingly mainstream political thinkers, kind of tech business people and all of these groups. And, you know, they see crypto as being a kind of significant and durable piece of the puzzle.

• 58:39Speaker 02

  So I think from a lot of angles, it's just made a lot of progress and it's much less of this kind of pie in the sky speculative thing than it was even two and a half years ago.

• 58:54Ryan Sean Adams?

  Okay, Vitalik, so that was present. We talked about past and present. We want to flip forward to future. So Ethereum future. We began the conversation, you talked about some optimism you had, a lot of the worries that you'd previously had were not present anymore. We were making progress in many areas. But you probably still have some worries about where this whole thing could go wrong. What worries you the most? What big problems do you still see in front of us?

• 59:26Ryan Sean Adams?

  Like preventing us from being the system that we all want it to be?

• 59:29Speaker 02

  I would say the bigger problems at this point are less technological and more cultural. So. Like, one of the things that so worried me around the past one and a half years, right? So if we look at this kind of rise of ETH maximalism that we've seen, right? Like, on the one hand, I totally understand, you know, why that trend kind of beca- uh, became a thing and started to exist. Um, you know, before that, there was definitely this kind of culture of just not being able to talk about things like the value of ETH as a, as an asset or, uh, you know, even just being optim- optimistic about Ethereum specifically as a thing.

• 1:00:11Speaker 02

  And there are a lot of projects that were kind of walking all over us in some sense and just kind of pretending to be the Ethereum community's friends. And then, uh, kind of talking at, at our conferences and then going kind of behind the Ethereum community's backs and talking to VCs about how terrible Ethereum is and how they're going to be better. Uh, and there is this kind of reaction to that, um, that happened. But at the same time, there's definitely a lot of downsides, um, and there's a lot of risks. Uh, so, like, in a lot of ways, right? Many aspects of Ethereum culture and kind of the influences that I've tried to make to Ethereum culture are a reaction to what I perceive as being failures in Bitcoin land.

• 1:00:55Speaker 02

  Um, so I feel like we've always been trying to be multi-chain friendly just because of how multi-chain hostile, like, kind of the Bitcoin maximalist mentality has been ever since 2014. Um, we have the multi-client roadmap because, uh, as a reaction to, uh, the negative consequences of the dominance of Bitcoin Core. Um, we have, uh, you know, miners voting on the gas limit as a reaction to, uh, the flaws of having a totally fixed block size. Uh, you know, proof of stake as a reaction to the flaws of proof of work and all of these different things. But, um, and...

• 1:01:36Speaker 02

  Ethereum, we're kind of, that culture and that aspect of it is definitely kind of becoming more like some of those things. And there's benefits to some of those things, like there's benefits that come from even just being honest about the idea that, you know, ETH, the asset is a great asset to have and it's one that can, whose value can sustain itself going into the future. But at the same time, you know, there's risks that come out of just being unfriendly to independent blockchain ecosystems and just saying that, you know, if it's not on Ethereum, it's worthless.

• 1:02:18Speaker 02

  There's risks that come out of just having a culture that has even the slightest risk of being perceived as the outside as not being about improving the world, but being about making itself richer.

• 1:02:36Speaker 02

  You know, there was that comic that is kind of fairly famous and kind of propagated around some parts of Bitcoin land where, you know, and if you, like, the guy's holding a balloon and the other guy's saying, you know, oh, this is just a bubble. And then the balloon turns into a big hot air balloon and the other person says, oh, that's just a bubble. And then the guy ends up standing inside of this kind of protective dome and on the outside, you know, you have total civilization devastation and the guy on the outside is still saying, oh, you know, it's just a bubble. And like, there's a seductive appeal to that mentality, but of course, you know, that mentality,

• 1:03:18Speaker 02

  there's also a very deep kind of darkness to that mentality because it's basically saying, we're not about improving the world, we're about being part of the process of the world collapsing and only if you basically buy your coin, will you be able to pretty much have salvation and be kind of on the right side of the new apartheid instead of being on the wrong side. And I would rather be a part of a community that's about making sure the world doesn't blow up in the first place. And so.

• 1:03:51Speaker 02

  Like, I definitely worry about kind of losing um those aspects of um kind of ourselves and who we are as a byproduct of a kind of some of those trends. But I feel like the Ethereum community does have a lot of people that are willing to provide a lot of pushback against some of the more negative aspects of those mentalities. So I think, you know, there's definitely things to be optimistic about. Like, I feel like there's definitely like just a lot of people that do understand why it's important to not overdo some of those things.

• 1:04:30Speaker 02

  And so I feel like there's a very, very strong chance that we'll be able to kind of successfully avoid most of those traps. Um, so that's one cultural thing. Another cultural thing that worries me is, um, so from a kind of just global, you know, mega political, to use that word from a sovereign individual, a kind of narrative around, you know, what kind of cryptocurrencies are and a kind of the way that that narrative interacts with kind of what the blockchain is and what people use it for, right? So this is actually a place where I think Bitcoin does it well, right?

• 1:05:12Speaker 02

  So Bitcoin, kind of the ideology is basically that, oh, you know, the central banks are just totally being incredibly irresponsible with all this money printing and the US is gonna collapse and the EU is gonna collapse and a bunch of places are gonna collapse and things will be terrible. Um, and the thing that you're supposed to do is huddle. And if you huddle, you're being part of kind of the money of the future, um, and you will benefit, right? And so kind of this broader ideology and this kind of set of facts that those people believe about the world and the people believe about what the world is going to be, actually meshes together with the messaging about what you're actually concretely supposed to do with the blockchain and why that's good for you, right?

• 1:05:54Speaker 02

  Which is basically huddling, because if you huddle, you're gonna huddle the coin that's going up instead of huddling the coin that's going to zero. Um, and in Ethereum's case, there's less of this kind of nice meshing, right? Like, there's definitely a lot more diversity of political views, like definitely.

• 1:06:14Speaker 02

  A lot less of this common belief that, you know, the world is going to go to hell um in that same financial way. Like, there's definitely some people who believe that, and then there's other people that don't believe that. There's a lot of kind of diversity of political perspectives. Uh, there's a lot of diversity of kind of economic perspectives, of perspectives a- about around like what decentralized social media should look like, for example. And the things that people do with the Ethereum blockchain today of in a lot of the time feel kind of a little bit disjoint from that, right? So even taking yield farming, for example, right?

• 1:06:54Speaker 02

  Like, there's no real way in which, like, your ability to get, um, you know, se- uh, a hundred and thirty-five percent interest from yield farming today a kind of meshes together nicely with a belief that people in the Ethereum community have about, you know, what the future of uh like economics and geopolitics and finance is going to look like. Um, yeah, like, it feels like those two spheres are kind of less kind of merged together with each other. And I think there are cases where this is not true. So like, I think quadratic funding is one of those examples, right? Like Ethereum people are, in many cases, passionate about creating new and better social systems that solve the problems of the twenty-first century.

• 1:07:36Speaker 02

  And quadratic funding is one of the things that potentially stands to be an actually credible solution to and of the question of how to allocate money for public goods funding. And quadratic funding is something that people actually participate in. And in this case, specifically as a way of like helping to make the Ethereum community better today because people care about the Ethereum community today, right? And so that's one example where a kind of your belief about the world and uh your like the thing that you do today as a member of the Ethereum ecosystem actually do uh kind of like work together really nicely. But like in the case of decentralized finance, for example, I mean, stable coins may be a good example, like, uh, maybe.

• 1:08:22Speaker 02

  I mean, even just international cryptocurrency payments, potentially a good example. And like, there are some, there are some kind of good examples of this, but there is also a lot of kind of some cases where there is this kind of disjointness and like, a lot of this disjointness is, is a kind of hard for me to kind of under

• 1:08:45Speaker 02

  kind of really fully, kind of entirely, kind of explain what exactly makes me uncomfortable about it. It's more of this kind of instinctive thing. But it is something that I think we as a community could, I guess, do better at. Um, so, yeah, I guess, kind of, so one, just concerns about Ethereum maximalism and just kind of turning into something that makes Ethereum a less inclusive and welcoming community is one risk, and then the other risk of being this

• 1:09:18Speaker 02

  disconnect between macro narratives and kind of the what people are supposed to do with the Ethereum blockchain today. Those are kind of two of the cultural issues that concern me. And then there's, there's a bunch of other, other ones, but they're kind of much smaller. And, and on the technological side, I would say the thing that concerns me the most is basically that, you know, we are going to have a big bubble of adoption and interest and that this bubble will come before Ethereum scaling technology is ready for it. Uh, so I guess I hope that the people, uh, developing Ethereum scaling technology will continue,

• 1:10:01Speaker 02

  um, you know, adding oil and, uh, keep continuing to just build it out and, uh, and shipping it and, uh, rolling it in, out into the hands of people who need it. So. I'm fairly optimistic, but we'll see.

• 1:10:16David Hoffman?

  On that last one, Vitalik, we're close though, right? With rollups? I mean, we're close to being able to offload some of the mainnet traffic, aren't we?

• 1:10:23Speaker 02

  Uh, yeah, so I think, uh, ZK rollups, there's, uh, loopring at ZK sync that exists already. Optimistic rollups seem like they're about half a year away. So, we're definitely close. I think the main concern at this point is less the tech side and more the adoption side. Like, how do we actually get the people that are using Ethereum today using rollups instead of using the main chain, right? How do we get the people that are sending all of those ERC20s around, sending them inside of Loopring or sending them inside of ZK sync instead of continuing to just send them on the Ethereum network and paying high transaction fees for them? And that's a question that'll be resolved by, I think,

• 1:11:08Speaker 02

  talking to wallets, kind of talking to applications and getting a whole bunch of these different ecosystem players together and getting a kind of common roadmap, which is definitely a coordination challenge, but it is one that we'll have to figure out.

• 1:11:23David Hoffman?

  Vitalik, you talked a lot about, um, how the Ethereum community is a little bit more nebulous than the Bitcoin community and how, you know, the Bitcoin community has this rallying cry about exactly how you participate, which is you buy BTC and you hodl and then you create the superior money system. Whereas Ethereum doesn't really have something such a strong totem to rally around. And I'm always reminded by a metaphor that Amin Soleimani put out forever ago, which was, uh, the 300 Spartans versus the Athenians, where the Athenians are kind of this hodgepodge group of people. Like, one's a carpenter, one's a blacksmith, one's a farmer. And then when you put them all together, you have this kind of hodgepodge army,

• 1:12:07David Hoffman?

  which compared to the 300, the 300 is this very strong, like, phalanx of just people that is a hard nut to crack. However... And we see, and me and Ryan always like to talk about how like the code or values of a blockchain actually impacts the community that runs around it, right? And so Bitcoin is not expressive. And as a result of that, it's pushed complexity out to the fringes, right? And I was listening to a podcast with Press Switch and Hazu and from Uncommon Core last night, where they talked about the absolute lack of complexity at the base layer has pushed so much complexity into Lightning Network that it's actually been relatively restricted in itself because of how much complexity is there.

• 1:12:51David Hoffman?

  Whereas Ethereum has this expressiveness at the base layer, which seems to be reflected in an expressive community of a number of different people. And so while Ethereum is more expressive, I'm optimistic that that code, that values baked into the Ethereum system, the Ethereum blockchain, does actually allow for a more scalable social community, a social community around the Ethereum blockchain, simply because the expressiveness is baked into the L1. Am I on to something here, or do you see a problem with this?

• 1:13:28Speaker 02

  That's definitely true. And I think like, and kind of the moral of the story in 300, of course, was that the hyper dedicated and focused kind of militaristic Spartans end up being more valuable in saving Greece than kind of the motley Athenian crew. And, you know, in real life, the Spartans end up eventually winning the Peloponnesian War and all of those things. So I think, but like, the real life is not exactly like that. Like, I think the challenge in real, in our real life is basically that, you know, in real life, there's more than two teams, right? Like, our model of war tends to be that there's two teams.

• 1:14:13Speaker 02

  And so your objective in war is to kind of create maximum cohesion and strength within your team and so that it can beat the other team. But in real life, there's much more than two teams, right? And when you have more than two teams, you're not going to be able to beat the other team.

• 1:14:26Speaker 02

  Than two teams, uh then the winning strategy is basi- uh is basically to gang up with um the majority of the other teams and that kind of win against the re- the rest of the teams that are not part of, part of your alliance, right? And, and so if you have more than two teams, then a skill that becomes as important as raw military power is your ability to convince other people and appear sympathetic and appear as the sort of team that other people would wants to be allies with, right? And I feel like that's uh one of the Ethereum community's big strengths, right? You know, the fact that we have all of these large corporations uh

• 1:15:07Speaker 02

  building on Ethereum that we have a kind of a lot of friends and allies in academic community is that we have uh a lot of just different people all around the world that are interested in kind of building Ethereum related things. So I think that's an advantage in a lot of ways. Um, and I definitely think that the Ethereum community is a kind of model of like what crypto is all about is less one of uh kind of we're going to war and more about uh kind of this is a complex world with, you know, lots of bad forces and lots of good forces and it's a pretty kind of complicated challenge, but let's uh kind of make friends and see if we can

• 1:15:51Speaker 02

  fi- uh figure out a way to succeed in a um in a way that maximally tries to make everyone happy. And if you're optimizing for that kind of world, then uh you know, you do want your uh your blacksmiths and again, and your poets and um and all of these other characters. Uh, so, yeah, and yay Athens, I guess.

• 1:16:15David Hoffman?

  So, so one, one common theme on, on the bankless pod and what me and Ryan are always trying to define is what is Ethereum? Like, or Bitcoin too, um, like i- it's not just a blockchain, right? It's not just a database, it's not just a protocol for updating that database, it's also a community. It's a, so like, what, how do? Do we define these things on like the grand scale? When you take all of the interconnected components and you look at them holistically? What is it? Is it a religion? Is it a nation? A technology? Like, when you compose everything together, what do we actually have?

• 1:16:52Speaker 02

  No, this is an interesting question because the answer ends up being different depending on kind of how you think about it.

• 1:17:01Speaker 02

  You know, is it do we focus on ether? The asset? Do we focus on the Ethereum blockchain? Do we focus on just blockchains using the Ethereum technology? You know? Is Ethereum classic a province of the Ethereum nation? Or is it just something completely split off and different? Is enterprise Ethereum part of Ethereum? Is are some of these other kind of newer blockchains that are basically forks of Ethereum? But then go off and do a bunch of their own things? Are kind of part of this great Ethereum bubble? Or at what point do they kind of go sufficiently far that they that they're outside of it?

• 1:17:47Speaker 02

  It depends. And I think it's, you know, the real world, I think,

• 1:17:53Speaker 02

  is one where there's a lot of these kind of complicated Venn diagrams where depending on what you care about, you end up kind of including and excluding different things. Like, I don't know if you've seen this, but there's this kind of fairly famous kind of diagram that attempts to describe what Britain is. And, you know, you have a circle around England. You have a circle around Britain. You have a circle around the British Isles. And then you have a circle around the a couple of other terms where to someone who's kind of pretty far away from kind of all of that, you know, hey, England, Britain, aren't those kind of synonyms of each other? Eh, you know, no, it's actually this kind of really complicated thing. And there's a bunch of people, they're kind of different ideas about what gets included and what gets excluded.

• 1:18:34Speaker 02

  And are you focusing on political things or focusing on kind of geographic other things?

• 1:18:41Speaker 02

  So I don't think there is one clear answer. I think the answer does ultimately depends on what you would care about.

• 1:18:47Ryan Sean Adams?

  So Vitalik, you mentioned ETH the asset and that being sort of a stakeholder group, and it certainly is. Our take has been that ETH the asset has been underappreciated in the past. And by past, it probably means recent past, you know, the last two years, let's call it. Underappreciated as a source of collateral for all of the DeFi that's built on top of it. Underappreciated as a, as security essentially for the entire network. And we put out this idea, like the triple point asset thesis idea, which is that ETH is kind of three super asset super classes at once.

• 1:19:30Ryan Sean Adams?

  It acts as sort of a commodity when you buy ETH transactions with it and use it to pay for gas, that sort of thing. It, in staking, it will act as a capital asset in that it returns you some ETH, almost like a bond or like a T-bill in exchange for depositing and bonding it. And it also acts as a store of value in some ways. So a collateral for the entirety of the DeFi space. Do you buy into that? And what's your take on what ETH actually is?

• 1:19:59Speaker 02

  No, that definitely makes sense and thanks for explaining. And when I saw the term like triple point asset, I think it was yesterday on Twitter. At first I thought it had something to do with, you know, those, that particular kind of temperature and pressure where ETH is somehow a solid liquid and a gas at the same time.

• 1:20:16David Hoffman?

  No, that's exactly right. That's exactly right.

• 1:20:19Speaker 02

  Okay. Oh, I see.

• 1:20:20David Hoffman?

  That's, that is the exact metaphor.

• 1:20:22Speaker 02

  Oh, okay. Now I, okay. Now we actually get it. Yeah, it is gas and store of value and medium of exchange. Okay. No, that's.

• 1:20:30Ryan Sean Adams?

  And all of those things at once, right? Because ETH is very, you know, composable. It could be all of those things.

• 1:20:35Speaker 02

  Okay, that's really cool then. Um, I definitely agree with that. And I think there's definitely multiple ways of thinking about Ether. And the nice thing is that I think these functions, they don't interfere with each other and they even kind of complement each other, right? So like especially, you know, once EIP 1559 comes out and you get some ETH being burns, then the more ETH that gets used to pay for transaction fees, the better a store of value Ether becomes. And if ETH gets used as a store of value, then that also kind of. You know, might push up its price and ends up leading to a more secure network.

• 1:21:15Speaker 02

  And then if people, more people send transactions, some of that also ends up going to the stakers. So there's definitely a lot of kind of virtual cycles and kind of positive feedback loops between those three use cases. So, you know, it's definitely a good way of thinking about it.

• 1:21:34Ryan Sean Adams?

  You know, our other take is that the value of ETH is super important for the security of the network. But, but also, if you want, you were talking earlier about some of your favorite DeFi use cases. You mentioned stablecoins that your favorites were among the like more crypto economic stablecoins. And for those types of stablecoins, having a protocol relatively like risk-free source of value, source of collateral tends to be pretty important. Like, what's your take? I mean, how important is the value of ETH to the success of Ethereum?

• 1:22:12Speaker 02

  You know, the stablecoin case is definitely a good example because ultimately, you know, the total amount of value that can be stored in ETH-backed crypto economic stablecoins is bounded above by the value of all the ETH, right? And so if there's no value in ETH, then it becomes much harder to have a lot of value in crypto economic stablecoins. So that's definitely.

• 1:22:35Ryan Sean Adams?

  We have another metaphor for that, by the way, Vitalik, which is economic bandwidth. You know, ETH acts as sort of a, sort of a value bandwidth at the base layer for these other assets that can be built on top of it.

• 1:22:49Speaker 02

  Right, okay, so what's, so what's the metaphor for ETH being a plasma? And what's the metaphor for ETH being a Bose Einstein condensate?

• 1:22:58David Hoffman?

  I don't know, maybe you can help us with that one.

• 1:23:00Ryan Sean Adams?

  Yeah. Well, we'll save that for the future. You know, that's, that's 2025 type of, you know, memeing, I think, we're still in 2020.

• 1:23:11Speaker 02

  Okay, yeah, that's fair. No, 2020, you know, the hindsight year, it's a good year, let's finish it. Yeah.

• 1:23:18Ryan Sean Adams?

  Vitalik, one other question on ETH the asset, and that's ETH's monetary policy. So that's been a criticism historically of Ethereum that it doesn't have a fully defined monetary policy. We've talked about minimum necessary issuance as being sort of the social contract of Ethereum, yet the truth is, it's not something, minimum necessary issuance isn't something that can be really hardcoded into Ethereum. So it's decided by the social contract, you know, should we readjust gas downward, for instance, that's kind of, or should we decrease issuance? That's kind of decided by the social contract. Is that sustainable? Or do you think

• 1:24:02Ryan Sean Adams?

  we need to kind of codify ETH's monetary policy as part of ETH 2? And what would that even look like?

• 1:24:07Speaker 02

  Well, the trouble is that you can't like permanently codify monetary policy, right? Because ultimately, it is just backed by the social contract. And if the social contract changes in Ethereum or in Bitcoin, then the total supply ends up being different from what people expected it to be. Now, of course, you can have social contracts that value immutability more than others. And you can even have a social contract that values kind of greater and greater ossification over time, which seems like roughly the social contract that Ethereum has already. So I don't think there's much kind of too special that we need to worry about in that regard. I mean, it definitely is something that I

• 1:24:49Speaker 02

  think we should avoid ossifying kind of at the beginning, because proof of stake in Ethereum's variety especially is still an untested experiment, and we have no idea how sustainable it'll be. But kind of over time, moving toward freezing values in place and moving toward adding stronger guarantees, I think is definitely something that's reasonable to think about.

• 1:25:09David Hoffman?

  But you do think that the issuance rate of Ether should be something that is calcified in Ethereum in the future at some point? Is that, is that right?

• 1:25:21Speaker 02

  I don't think I'm a proponent of calcifying the issuance rate in the sense of guaranteeing a hard number like, you know, a hard cap or even a hard like 0.1% a year or something like that. I mean, in the proof of stake design that we have, right, there is already a planned kind of upper bound of 2% a year. Um, and if we want, we could obviously try to reduce that upper bound. But even that upper bound is still kind of ultimately changeable by changes to the protocol. Uh, so, and that's something that we're just going to be kind of more and more comfortable with over time. Um, the reason why I'm not comfortable with a hard cap is basically because like I do believe that we should take this trade off of like,

• 1:26:05Speaker 02

  if we have to make a choice between certainty of issuance and certainty of the level of Ethereum platform security, then we should choose a certainty of the level of Ethereum platform security.

• 1:26:16Ryan Sean Adams?

  Do you also agree, Vitalik, that um, since the the platform security is backed by the asset itself, there can be kind of a value if you have a neutral monetary policy that that groups of people, you know, value more.

• 1:26:35Ryan Sean Adams?

  That therefore increases the price of of the asset increases your security. Is there kind of a balance there? I mean, Bitcoin has achieved uh, some pretty tremendous security based on the meme value of Bitcoin, let's call it, of this fixed cap. You know, can we benefit from that in Ethereum?

• 1:26:53Speaker 02

  I mean, that's true, though I feel like there is other ways to benefit from that meme value. Like even for example, if you look at just the amount of transaction fees now and like, if those transaction fees end up like even 80% getting burns, then that's already higher than graded proof, expected proof of stake issuance. So I think if we're just a little bit patient and we start seeing, you know, four or five years from now, there being like entire long periods of time where if either issuance goes negative, then that's something that could turn out to be an insanely powerful meme by itself. Like even if it's not technically guaranteed and even if, you know, usage stops, it goes back to being positive for some time.

• 1:27:35Speaker 02

  And just even that's something that could end up attracting a lot of people. So. I don't think we should even be kind of trying to freeze things now. I think we should be willing to be a bit more patient than just seeing what proof of stake ends up looking like economically speaking.

• 1:27:52Ryan Sean Adams?

  And as we enter proof of stake, as it's defined now in the protocol, how would you sort of describe issuance? So you mentioned sort of a 2% upper limit. Do you have some other details of how you might describe what issuance policy will be in proof of stake?

• 1:28:04Speaker 02

  Yeah, it's basically kind of an increasing function in how many people validate. So if very little ETH is validating, it could be as little as like 100, 200,000 ETH a year. And then if literally everyone validates, it ends up going up to 2 million ETH a year. And then you subtract from that transaction fee burn. So that's basically what it is. And that does feel kind of very abstract and weird and like, you know, I'm just like somebody who wants to figure out whether or not to hodl a cryptocurrency. Why are you throwing weird math formulas involving square roots at me? But I think that people will kind of overrate the cost of that.

• 1:28:48Speaker 02

  And the reason, again, the mental cost of that. And the reason why people overrate the mental cost of that is because it's a formula today. But when ETH2 is running and when people see what the formulas actually lead to and what results they create in practice, I think people will just see, okay, yeah, fine, these are the numbers that it looks like it is in practice. And those are numbers that I'm fairly comfortable with and so I'll participate. Like I think the like, average people and especially people that are not so much super analytical. I think like us analytical people underestimate the extents to which kind of those like less analytical people

• 1:29:32Speaker 02

  are willing to just like kind of intuitively reason by looking at past experience and the extents to which that actually works pretty well for most people.

• 1:29:40Ryan Sean Adams?

  Yeah. Any guesses on how much time Satoshi thought about the 21 million hard cap? Like how much time he put into that? Like my guess is probably very little. It was kind of a guess, right?

• 1:29:52Speaker 02

  Yeah, that's my guess too.

• 1:29:54Ryan Sean Adams?

  And that issuance rate that you were talking about, that's going to be hardcoded in Ethereum the same way the 21 million is, of course, maintained by social contract, but also hardcoded, right? Very good. All right, Vitalik, we're gonna finish this up with a quick lightning round, sir. So just a sentence or two answer on these if you can. If not, then we can discuss it some more. The first question I have, the lightning round, is are gas fees, so gas fees are too high and that leads to inequality. Do you think that statement is fair or overblown?

• 1:30:29Speaker 02

  By the way, it's not a lightning round, it's a roll-up round.

• 1:30:37Speaker 02

  I definitely think that gas fees being high is bad for Ethereum's goal to be an egalitarian system. And that's a big part of the reason why I'm so focused on scalability.

• 1:30:47David Hoffman?

  Ether flipping Bitcoin, is that gonna happen?

• 1:30:50Speaker 02

  We'll see, no comment.

• 1:30:53David Hoffman?

  Fair enough.

• 1:30:54Ryan Sean Adams?

  What's the low-hanging fruit that you'd like to see built on Ethereum, Vitalik?

• 1:31:00Speaker 02

  I mean, I keep yelling about smart contract wallets, so can I keep saying smart contract wallets?

• 1:31:05David Hoffman?

  Absolutely. Why smart contract wallets?

• 1:31:08Speaker 02

  Just because like wallet security is, I think, just a boring but continually underrated problem. And we need to have like just solutions to that that have good user experience. Another thing I'd probably also say is that in addition to having like stable coins for the dollar, I think it would be nice to have synthetic assets that represent other kinds of assets. So like other major fiat currencies and major stock indices would be the thing that I would go for.

• 1:31:34Ryan Sean Adams?

  I get to take this one, David. What's your favorite ETH killer, Vitalik?

• 1:31:40Speaker 02

  I mean, I like some of the work that these optimistic roll-up teams like Fuel and Optimism and Arbitrum are doing.

• 1:31:50Ryan Sean Adams?

  Yeah, I'm curious how you stay so unflappable in the face of all of the Twitter trolling. Do you have like a secret for that? How can we emulate you?

• 1:32:02Speaker 02

  I guess eventually you just kind of get used to it. And I don't know, just kind of take life less seriously and I guess it comes naturally.

• 1:32:15David Hoffman?

  So in Ethereum, we tend to rotate what our focus is from time to time. Right now, it seems to be there's this boom of L2 networks coming online. There's also the DeFi movement. Perhaps there's also prediction markets on the horizon. What do you think the Ethereum world is going to focus on next?

• 1:32:33Speaker 02

  Hmm. I think continued work on DeFi. I think there is going to be a lot of focus around like actually finalizing and ruling out the scaling solutions. And that'll end up occupying a lot of people's attention. Hopefully more privacy solutions too. In prediction markets, I hope that we'll see more interest in actually using those. And I know Omen is out and Augur version two is coming out soon.

• 1:33:03Ryan Sean Adams?

  Next one is, is crypto on a collision course with nation states?

• 1:33:07Speaker 02

  Hmm. That's an interesting one. And crypto is definitely in a very interesting position kind of with respect to the current kind of geopolitical and info-political landscape, right? Because the geopolitical landscape seems to be one where at least centralized systems are finding it harder and harder to escape the reality of them being being inside the nation states that they happen to be based inside of. And people trying to kind of create more and more of these kind of nation state level barriers. So, you know, obviously the kind of the Chinese firewall has been around for a long time.

• 1:33:48Speaker 02

  And yesterday, Pompeo made a bit of a bluster about wanting to ban TikTok. In Europe, there's been a lot of this kind of unfriendliness toward US tech tech companies for some time. And then, of course, some people obviously say, oh, no, that's just antitrust and data protection. And then the cynics kind of say that, well, actually, kind of a lot of these kind of moves seem very targeted toward like basically kicking US companies out. So there is this kind of balkanization of the centralized internet. And then the other one I'll add is, of course, India banning all of those Chinese applications. And this desire of kind of

• 1:34:35Speaker 02

  Building these kind of tech, uh, kind of techno-centralized civilization states, um, essentially. And crypto is kind of standing strong as one of the few remaining things that's genuinely really international. And that's a kind of position that we should be very kind of happy that we've managed to kind of maintain and stay inside.

• 1:35:01Speaker 02

  And I mean, I do think that kind of the, the cryptocurrency part of crypto is a big part of why it managed to do this. And why it actually managed to kind of get some of this global appeal, right? Like, uh, you know, the ideology is the ideology, but, uh, you know, number go up is a kind of, uh, one of the closest things that we, that humanity actually has to, uh, universal values, uh, kind of like it or not. Um, and that's something that puts it into a position where it has the ability to kind of continue to exist as a upriding layer between, uh, kind of, uh, all of these different ecosystems. But at the same time, you know, that means that crypto can do things that, uh, kind of other actors, uh, increasingly can't do.

• 1:35:44Speaker 02

  And that also kind of puts a target on the back of its head. And will crypto be able to kind of weather the storm in terms of having that target on the back of its head? I don't know. We'll see. And this is, uh, definitely one of the big challenges that we're going to have to navigate.

• 1:36:00David Hoffman?

  In what ways is crypto going to be bad for the world?

• 1:36:03Speaker 02

  Hmm.

• 1:36:05Speaker 02

  Uh, I mean, the speculation bubbles have definitely had, uh, kind of negative consequences. I mean, in, oh, in a lot of cases, um, some of the kind of Ponzi's and especially the ones, uh, targeting third world countries, um, have, uh, had negative consequences. And I think we've definitely, we as a community have definitely not come close to exhausting our options for trying to deal with and mitigate some of, some of that damage. And there's a lot, uh, considerably more that we could be doing. Um, and even like fully in the context of, uh, crypto being a, and Ethereum being a fully permissionless and decentralized system

• 1:36:48Speaker 02

  where we can't just like kick off applications we don't like, like even, um, I would, given that constraint, there's still a lot, a lot more that we could do.

• 1:37:01Speaker 02

  I mean, ransomware, also a negative consequence. So in general, right, like, there's, it is definitely kind of one of the just the facts of censorship resistance that you're also going to end up taking on applications that basically kind of people would have wanted to wanted to censor for reasons that you sometimes like, and that's kind of one of the costs that you have to end up paying. I mean, I do think that kind of some of the reputation that kind of crypto gets as a result of those things does end up being undeserved.

• 1:37:42Speaker 02

  Like, basically, the kind of effect is, right, that a lot of those kind of undesirable use cases, ultimately, like, they're going to exist anyway, and they're going, but of course, they're going to move on to the platform that's kind of most convenient for them. And so, the marginal benefit of that crypto provides to these applications is much less than a kind of the volume of activity of activity that's have of those applications that's happening inside of crypto, right? Because if crypto did not exist, then those applications would probably still exist, it would just exist on other platforms. And yes, often those platforms would be less efficient for those use cases, but kind of

• 1:38:27Speaker 02

  that delta of the increase of efficiency that crypto provides is much less than just the total volume of those applications that ends up happening on crypto. So I do think that, and the extent to which crypto is responsible for those things happening, ends up being kind of overstated in a lot of cases, but there are real issues and there are real things that we could be doing more to mitigate in that regard. And there's a lot of things that Ethereum and the Ethereum community have been doing to mitigate, right? Especially if you just look at the Ethereum community versus some of the more unscrupulous crypto communities in the space. Like, there's definitely a night and day difference, but there's still much more that we could do.

• 1:39:13Ryan Sean Adams?

  Do you believe immortality is possible?

• 1:39:16Speaker 02

  Uh, yes, I do. Well, it depends what you mean by-

• 1:39:22Ryan Sean Adams?

  Is it going to be good?

• 1:39:23Speaker 02

  Oh, oh, that absolutely.

• 1:39:27Speaker 02

  Like, the way that I think about it is like, imagine if, you know, we were elves and we were actually immortal. And then someone came along with the bright idea of like, hey, how about we in, um. Unleash a virus into the world that makes everyone die after a hundred years and we're going to do this because, um. You know, old people deserve to die because they have bad opinions or, you know, whatever, uh, uh. Other, like, one of these really horrible reasons is that people comes up with, like. People would just reject, completely reject that. And if, if someone tries to do that by force, they'll be like, basically just. Hanged for genocide pretty much immediately, right? So if you flip that around, like, yes, of course, I think, and if humans being.

• 1:40:09Speaker 02

  Uh, immortal is a vast improvement over this, uh, over the status quo. Um. And I actually think that, uh. We are going to see a bit of a kind of sea change in favor of those things. Like, what are the things I've noticed, um, as a result of COVID nineteen? Is that people are realizing that, you know. Bad things don't just happen because of technology. Bad things can't happen because of lack of technology. Like, if we had a vaccine for the virus, then we would have much fewer problems. Like, if we had. Better ways of just understanding what the heck is going on in terms of the virus and who it's infect, uh, who it's infecting and how. Um, and if we had better statistics, then there would be much fewer problems.

• 1:40:51Speaker 02

  But on the other hand, if we had a kind of back to the land caveman society, well, guess what? We would still have the virus and it would kill considerably more people. Uh, so there is definitely this kind of pro-technology trends that I'm seeing coming out of this. And I think. Pro-using technology to get rid of biological mortality entirely is going to be a. One of the positive, uh, kind of results of, uh. Of that trend. But of course, biological mortality can only get to about a few kind of trillion or quadrillion years before the entropy of the universe starts running out. And then there's a question of like, can we kind of create new universes and keep

• 1:41:32Speaker 02

  on putting ourselves into your universes to survive even beyond then? And I don't know. And I hope we can. And infinity is definitely better than a quadrillion years, but we'll see.

• 1:41:41Ryan Sean Adams?

  Vitalik, one last question for our roll up round, and it's been an absolute pleasure to have you, sir. And we'll close it out with this question. How are you going to be celebrating Ethereum's fifth birthday on July 30?

• 1:41:56Speaker 02

  Hmm, I don't know. Maybe maybe running a 2.0 staking node. We'll see.

• 1:42:04Ryan Sean Adams?

  All right, that's it. Maybe birthday cake and candles involved, or just the staking?

• 1:42:08Speaker 02

  Yeah, I mean, we'll have to see. Could do a birthday cake, too. Um, I don't know.

• 1:42:13Ryan Sean Adams?

  Five is a milestone. Vitalik, it's been a pleasure to have you on Bankless. Thanks for taking the time to answer our questions and speak with the Bankless Nation. We certainly appreciated it. And we are looking forward to new developments on Ethereum.

• 1:42:28Speaker 02

  Thank you. This has been great.

• 1:42:30Ryan Sean Adams?

  All right, everyone. Actions from that conversation. We've included in the show notes, a timeline to some of the key Ethereum achievements. So take a look at that. Reflect back on where we've come in the last five years. We've also included a link to some of the previous Ethereum focused episodes on Bankless. So make sure you catch up on some of those past Ethereum episodes as we start to celebrate Ethereum's fifth birthday. The third thing you could do is give us five stars. David, why do we need those stars?

• 1:43:05David Hoffman?

  We need those five stars because we are trying to grow the Bankless Nation. And the way that we do that is we get the Bankless Gospel into as many ears as possible. Climbing up the crypto podcast charts is difficult because of how many people downloaded podcasts in 2017. And we're still fighting against that tide today. So we're going to get there eventually, but it would be awesome if we had your help in getting those five stars and those good reviews so that we can climb the ranks when you type in Bitcoin, when you type in Ethereum, when you type in crypto into the Apple or Spotify podcast charts. Into the Apple or Spotify podcast search, that Bankless shows up first.

• 1:43:45Ryan Sean Adams?

  All right, let's do it. So risks and disclaimers as well. We talked about some of those in the episode with Vitalik. But just a reminder, ETH is risky. All of crypto is risky. So is DeFi. You could lose what you put in, but we are headed west. This is the frontier. It's not for everyone, but we are glad you are with us on the Bankless journey.