It's Alex. Welcome.
There's plenty to talk about. First, you want to give some
remarks on, I don't know the state of Ethereum.
What's on your mind that we can do it to specific things?
From the technical perspective, all of the pieces are finally
like actually in place to make it viable to do the kinds of
things that we've been talking about doing for a really long
time, right? And we could give a few
different examples of that, right?
So one of them is obviously scale, right?
So in, you know, 2017 crypto kitties, 2021 Defy, like what
broke all of those things? This is basically eventually
there was so much excitement and hit against a wall of fixed
usage and then the transaction fee is 1 to 5050 dollars and a
bunch of people got angry. Layer twos are collectively
doing about 250 TPS. And with Petra, there's the
upcoming hard fork in two weeks, the BLOB count will double,
it'll go up to 500. And then there's a pathway to
increase that to about 5000 for layer twos.
Basically like there's a pretty credible path to get to like
many thousands of TPS over the course of the next year or so.
And for the base layer, there's been this growing research
direction around basically asking how do we like super
optimize the L1? And in particular, how do we
like basically one like actually formalize some of our criteria
in terms of preserving the networks, decentralization,
preserving the networks resilience, making sure that
we're not just like 525 servers. And then turning that into
something where like we actually like have a very clear idea of
what the constraints are so we can super optimize around them,
right? And so there's a collection of
Eips that are planned for 2026 that, look, they have a very
plausible story for scaling the L1 gas moment by 10X.
And then after that, we of course have ZK VMS and that's a
story for scaling up even higher.
And so in terms of scale, like we've basically 10X already,
right? But then and then the question
is how do we go further and how do we improve interoperability
of things that already exist, right?
And so from a scale point of view, like things that could not
be done two or three years ago can be done now, right?
So that's scale. Another interesting dimension is
security, right? So if you think about Defy
right, then if you think about the question, well, would you
confidently with your, with your straight face recommends to an
average person to use Defy as a savings and wealth building
vehicle, right? I think honestly three or four
years ago, the answer just had to be an unambiguous no.
And the reason basically is that like what the hell is the point
of talk even talking about 6% APY versus 4% APY when the thing
that really matters to people is not getting, getting -100% APY,
right? And so the, but the, the thing
that we've seen since then, right?
I've actually, this is interesting.
Like if you look at the statistics, right, if you let
go, and I mean like ask the bot, like basically give me the total
number, dollar number of D5 hacks divided by the total
number of D5-TV Li asked. And the answer it gave us is
less is, I think 0.53%, right? So basically the in a randomly
selected D5 protocol, the chance that you'll lose money from
being hacked is only half a percent.
And that look like that feels a little uncomfortably high.
But number one, that's like half a that's only for risky
protocols. And if you like things like, is
that. Being trending down over.
Time, yes, and as. That's a great grass.
Yes, OK. And then if you look at things
like Ave., like basically the, you know, the sturdy stuff like
that's. Can you make a comment on that?
Yeah, I never did any yield farming or anything like that
because you'd be, quote, investing with the expectation
of 6% return. But you're actually risking your
entire principal because there can be a smart contract hack.
You could go to 0, right? So instead I'd only risk
principal in like an Angel investment where I knew that
could go to zero. And I just held back and waited
till D5 matured and now it started to mature.
Yeah. So basically and look for mature
protocols and like it's even lower than half a percent,
right. And then on top of that, the
other risk, of course, is like the risk that you personally
screw up because something happens to your wallet.
And then This is why I've been like pushing for social
recovery, multi six account abstraction, all of this stuff
nonstop for the last 10 years. And the thing that did happen,
right, is like the safe front end got hacked, right?
But if you were using an alternative UI, then you were
fine. If you were checking the
transactions you were signing, you were fine.
And obviously you can't expect regular people to do that,
right? But like basically the
infrastructure keeps on hardening and there's like 10
alternative UI's that you can use, right?
And so, and even I think the base UI is planning to move to
something much safer, right? And so from an average user
point of view, like the, your ability to get something which
is simultaneously like decentralized and not going to
waste your money, like that's rapidly increasing, right?
Like if you remember 2017 in 2017, like everyone thought that
smart contract wallets were dead because the wallet code itself
got hacked, right? You remember the Parity hack and
then there was another hack, basic parity got hacked twice,
right? And like that was sort of the
needier for trusting smart contracts, right?
And then since then like the safe smart contracts, like the
smart contracts have actually been perfect like basically for
like since the start, right? And so each and every one of
these things that in the beginning phase is this crazy
thing and like, Oh my God, there is a big chance you're gonna
lose all of your stuff. Now it's like it's maturing and
it's more and more just like actually completely fine, right?
It's funny you say it's because this is the flipping, right?
And I think that it's funny I said this to somebody.
And what is D5? It's what takes over after the
current financial system, Western financial system ends,
right? So there's like a flipping of
this is actually going to become more secure than the current
Western financial system. Go ahead.
Yeah, exactly. This is the the other side of
the graph, right, which is this the the degree to which you can
realistically expect confidence in Tratify.
Like honestly, if I had to put my like money in a Tratify bank
and then I guess even in the US and just ask, close my eyes and
then wait for a year later, is it still there?
I would say the risk that it's gone is probably a little bit
higher than half a percent, right.
Absolutely. Go ahead.
Yeah, likely to talk about this. Go.
Yeah, there's definitely people who will say it's like some
crazy number, like 20% that I will think it's that high,
right. But if you're talking about like
the survival of your nest egg, your retirement savings, like
even a frigging like 2% chance is scary.
Right. Well, that's funny because if
you take your numbers and you're saying the risk is higher, don't
invest in the US dollar, what you can't afford to lose, right?
Yeah, OK. We're starting to get more of
these assets that are actually coming online, right.
And so if you, you know, there's obviously the different U.S.
dollars, there's like a bunch of different U.S. dollars and
there's even, I mean, even like things like die like they're
only partially dependent on like actual U.S. bank, like bank
account deposits. And then you're starting to get
other kinds of assets. You're also starting to get EUR
and other currencies. And so you're able to get a like
pretty good diversified mirror portfolio.
And like your, your level of like personal political risk
basically drops down to like 0, right?
And I mean, for a lot of people and for like a rapidly growing
percentage of the world like that's there's a very meaningful
and like large reductions in, you know, your chance of getting
a -, 100% DPI there. That's right.
And I think so actually I have a few comments on this.
The first is that aspect of projecting rule of law and
contracts and so on that we have talked about for a long time in
crypto is actually now not even a reality.
It's like a necessity in Argentina or Nigeria or places
like this, right? It's actually stable coins are
actually being used all over the world.
And I think, I think they flipped Visa and MasterCard not
too long ago, right? Like it's basically more so when
people say what does crypto do? What are the applications?
Crypto where you're like, well, OK, there's digital gold, OK,
fine. But aside from that, OK, well,
it's like bigger than Visa and MasterCard.
OK, OK, what else you got right? Like and you know, then of
course it's already very, very big.
Go ahead. Because we're talking about
scale, right? We've talked about safety also
privacy is another big one. And Ethereum now has mature
privacy solutions with Railway now Privacy pools launched.
I mean, now even the Tornado Cash is legal again, yes.
I mean, it never really died, right?
It actually kept being used. But it's legal even in the like,
even in the US, to use again. We have to get Romans free.
Roman storm free. Free in.
Pardon, Alexei. Right.
It's both. Freedom, Freedom.
Pardon, Roman freedom. Pardon, Alexei.
Go ahead. Yeah.
Yeah, so a lot of a lot of improvements there, right.
Also in even on the non financial side, like even if you
think about like things like forecaster, like I'm honestly
impressed by their staying power, right.
Like I think like the default assumption I think any of us
would have had a couple years ago is like this is cool, this
is worth supporting because it's decentralized, but like it's so
hard for these things to like actually keep users going for
past the honeymoon period where they're excited.
I'm. Super.
I love Forecaster so much and we're going to do so much with
Forecaster. It's basically it is the open
social platform that we need and you just like they've, it's like
a relay race. I want to take the baton and go
further with it. So go here.
I can say much more about that guy.
Yeah. Like it's just, it's been
running for years. It's existed for years.
It has multiple clients. It has a pretty robust, pretty
thriving ecosystem. Like a lot of really great stuff
that's happening in forecaster land, right?
And it's like, and like a lot of people are increasingly
realizing like the kind of value that it has.
And like even aside from decentralization, just the value
of like a network where you can do like, you can talk to
interesting people and do interesting things and where
people are sane, right? And yeah, it's, I mean, also a
pretty big deal, right? And so like both on the
infrastructure side and on the technical side, like I think
we've just been seeing this really rapid rise in maturity
over the last couple of years that I think is like actually
really easy to underrate, right? And it's easy to underrate
because like rise of maturity often feels like nothing
happening at all, right? But the thing that is happening
is of course stuff not breaking and.
The reason that's so important is once something gets to like
100% reliability and it's no longer interesting, then you can
actually use it for something because you can only have so
many like risk tokens. Like if, if you think of like a
bunch of Jenga blocks for your startup or what have you, all of
the blocks at the bottom have to be like 100% like Python,
Django, It'll just work, right? It's like boring.
And then you can have like 1 risky thing on the top.
But if the whole thing is risky, then it'll be it won't work.
So the fact that these have gotten to that level of just OK,
yeah, it'll work. Let me move on to the next
scene. Allows you to innovate.
Go ahead. OK.
So talking about the tack, we've talked about the applications
like basically, yeah, even in prediction markets, another
example like they've basically gone from theory to being
reality. And the thing that I love about
prediction markets is how. Polymark was like the number one
app in the app. Store yeah like it gets
mainstream support and attention even from the types of people
who normally think crypto is a scam like the types of like US
political intellectuals that normally just like dismiss
crypto and think of it as failed like they are the same people
retweeting polymarket screenshots right and so like
that's like also been like probably the first breakout
other than a kind of classical defy that we've we've seen in a
long time so. Another one that's interesting
is Open Router, right? Have you guys seen open Router?
It let's you use different LMS and it just has Metamask login
is one of the options because it let's you pay for everything or
what have you, right? That's like crypto as a tool, as
opposed to like crypto hitting you in the face all the time,
right? Yeah, like it provides actual
useful value, right? Like you want to be able to talk
to LLMS without them and, you know, remembering everything
about you. So on that connecting that to
Ethereum, you know, like one thing that's very, very, very
rough and you know, I might like, I call this label
extremely approximate is like you're kind of roughly the
center left of crypto. I'm roughly the center right of
crypto. And we're both like centrists,
OK. And so one way of thinking about
this is I think Ethereum, like you talk about the technology of
it, but I think from the community standpoint.
And so maybe, you know, if you guys, have you guys heard of
like Ezra Klein and Derek Thompson's abundance agenda
thing, right? OK.
So I think that they're a thing about the abundance agenda.
It was based on the concept of like Bloomberg Democrats,
technocratic people as opposed to kind of the sort of riots and
fires and so on they're happening now.
But I think that the sort of central left abundance agenda
kind of people should look at Ethereum because I think
Ethereum can make a play for being the technocratic Bloomberg
center left of the, let's say, post Western or Internet world.
There's a lot of these sort of centrist center left people.
And if they were actually in control of the left, then we
wouldn't have a problem. But they're not right?
And they're putting up these things and they're trying to
take control of the US government or they think they
are. They're not going to be able to
do it. In fact, it's going to go
crazier. It's going to the Luigi left,
not the not the abundance agenda.
OK. And so because it's happening,
in my view, they have to start thinking different and they
start thinking about the other piece, which is startup
societies, right? So Ethereum is also into startup
societies. Obviously you have Zulu and all
the sons and daughters and grandchildren, Zulu Zoo,
Thailand zoo, Georgia Zoo, this who that right?
And the all of those things are basically places where you can
experiment with different forms of governance.
Those are all abundance agenda, sympathetic people.
And so they could actually go and do that kind of thing there.
And so I think the technocratic center lefts like the Noah
Smith's, Esher Klein's, David Shores, Derek Thompson's should
really lean into Ethereum, right?
And I think that's actually like a social or community aspect,
because that's not crypto as a scam.
That is crypto as actually the opposite of it.
It's actually crypto as community.
It's crypto as rule of laws. Crypto has, you know, like
equality of treatment wherever is a peer on the Internet.
Go ahead. I think the like, the important
thing, right is that it's like crypto has been a like a
symbolic Talisman in a lot of like those ways and also other
ways for a long time. But like there is a really big
difference between a symbolic Talisman and something that can
actually do do things for people that people directly need,
right? And like, to me, what's
interesting is that Ethereum actually is crossing that chasm
from being the first into into being the 2nd.
And I mean, also like it's not, it's also not just Ethereum,
right? Like this is a part of a, a
bigger ecosystem. And you know, like it goes
beyond cryptocurrency, beyond block chains, even beyond
cryptography. Like one of the topics I've been
talking about quite a bit recently is DX and like trying
to create like this decentralized defensive
acceleration and trying to create this kind of bigger tent
around like basically full, you know?
So on the topic. All right, so we're now about 2
1/2 years after the chat sheet. Devon, I want to argue with you
about this maybe. So are you still an AI
percentage zoomer or I don't know.
Would you? Would you, would you?
Would you call yourself a classified like you had you had
some non zero percentage of it? Yeah, yeah.
I mean, honestly, my IP zoom has gotten higher.
Yeah. I mean, I think the the basic
reason is that like progress is happening faster than we
expected and at the same time global politics is worse than we
expected. I think.
I mean, one of the, to me, like the biggest unrealistic thing in
kind of classical dumorism is probably not so much in the
problem, but in the solution, right?
Because a lot like one of the challenges I often see in this
like. Blowing up data centers.
Well, no, that like that's that's actually like the the
ironically the last naive one. The, the naive 1 is like the
nice guy international treaties approach basically because like
the, the classical solution to this right, is like, let's get
the, you know, the, the world to like come together and like
agree to not do all of this stuff and at this until we know
how to do everything safely, right?
And then at the same time, we're literally talking about a, a
world where countries are invading each other and like
threatening to invade each other and like blowing up tariffs to
Infinity and like all the all kinds of different things,
right? And so you know.
I want to, I want to argue on this because I think like in my
view, killer AI is already here and it's called drones, right?
And AI alignment cannot align quote an AI to everybody.
It has to align it to its controller.
And that could be one tribe or another tribe.
Each tribe will have its own drones, right?
So AI alignment is not synonymous with AI safety.
And in fact, is basically like the fact that killer AI equals
drones, killer AI equals robots means I'm not actually concerned
about in my with you image generators and tech summarizers,
right. Like those aren't those aren't
going to kill us right. The the robots would right and
go ahead. Yeah, So I'm not, I mean, I'm
not concerned about the image generators and summarizers
either, right. I think, I mean I even have the
receipts for this where I publicly like basically said
that like, hey, I don't expect like I basically expected the
whole election deepfake thing to be a total nothing burger.
And it has been. I mean, I think to me like the
flip from like danger being only sort of human to AI to danger
being potentially AI started like outcomes when AI crosses
like that roughly human level kind of autonomy and generality
threshold. OK, so that autonomy is a big
thing I want to poke on, right? I think to me, the biggest
surprise and the biggest argument among my tech friends,
maybe yours over the last two, 2 1/2 years, especially around the
time the chat sheet came out is will prompting endure, right.
And the fact that prompting has endured over the last 2 1/2
years and it shows no signs of going away unless just some
enormous technological breakthrough, means to me that
prompting is just higher order programming.
And it's just programming in English and then you have
programming in Python And you're programming in assembly.
And so if prompting doesn't go away, you don't actually have
truly autonomous intelligence. You have amplified intelligence.
It's not a gentic intelligence. Go ahead.
So given that assumption I agree.
But there is there is this interesting chart that shows the
the time duration of tasks so that AI can complete
autonomously and it has a doubling time of roughly every
seven months. And like historically, like
basically like naively assuming that curves will exponential
curves will continue has been a much better AI prediction method
than like pretty much anything else.
And so if you naively follow the curve, then you basically get to
AI completing tasks on the length of a human lifetime by
about 2035. Maybe it's possible, but I think
I don't know, the Transformers coherence breaks down and so so
there's certain kinds of things where like training is starting
to top out, like you're hitting the available amounts of data
out there. They need to generate them right
so often. So I understand your argument.
My counter argument is that is that I think genuine algorithmic
breakthroughs, conceptual breakthroughs are hard.
I can't say that it's impossible, but I would say that
right now prompting is much more of a constraint than people are
giving it credit for. That's a the other thing is, you
know, and this is like a counter argument.
Some of the stuff that Elie Eiser talks about is I think he
really underrates chaos, turbulence and fundamentally
mathematical systems or physical systems where predictability is
genuinely constrained mathematically.
Like you cannot predict beyond a certain window given finite
precision arithmetic. And if you, you could actually,
just as a thought experiment, have have an AI try to predict
the motion of a fluid under turbulence, it can't do that
without inventing math or maybe doing things we don't think are
even possible, right? So if that just shows that
there's limits on what AI can just do as a purely
computational thing, non empirical thing, I don't know.
I'm just like the idea of one prompt and it just runs for the
whole life. Go ahead.
And so I do think that like there have been like walls that
have broken before, right? Like so the, the big one that I
think really updated me towards some more concern is the whole
like deep sea car one chain of thought thing.
And the reason why that updated me toward concern is because
before that we were in a regime where it felt like the thing
that AI is fundamentally doing is it's just like basically
copying and kind of interpolating off of existing
training data. And so if you just do that, then
the logical outcome is that AI can do lots of things that like
roughly. Actually the level of the
smartest humans, but then it tops off there and then you
can't really go. For it, right?
But the chance on genuinely shows deliberations like a smart
person thinking about it. That's right.
Yeah. And like basically the way it
works right is that you start off with a model and then you
ask it to solve problems where you can objectively determine if
the answer is right or wrong. You have it like run 10,000
chains of thought and give an answer.
Then you filter for the ones where I got it right.
And then you just train on that again and you repeat the loop,
right. And then I like there for me,
for the first time we actually saw a training loop that could
plausibly get us all the way to superhuman and like there wasn't
something that it's obviously constrained by.
Interesting. Yeah, it's because it's not just
the probabilistic, it's also the multiple plans and then
selecting from them. I don't know, I, I think, well,
OK, here's the third piece, fourth piece, here's how you
would do this. This is this is like the how
don't build the Torment Nexus. How would you build the Torment
Nexus thing or whatever? But let's say 1 moment to go
about doing that, the So I think embodiment is obviously another
big piece. And I think that purely digital
AI just can't do it. It's like a, it's like a life
form that only lives underwater. And when it comes out onto air,
no matter if it's a giant blue whale, it's going to run out.
Of air. I agree with this too, but like
tensible optimists are pretty frigging impressive.
Yeah, well, yeah. So actually the Unitaries and
all these humanoids have gone. Impressive.
Exactly. That's right.
So the embodiment will get solved, right?
And but then it has to collect lots of sensor data.
And I think ultimately it has to have goals, right?
Because without goals, that's actually the very hardest thing.
Like humans, markets and politics are domains where train
and test doesn't. If it worked, then you'd be able
to just make tons of money in the market.
You'd be able to win elections. These are inherently time
varying domains that, yeah, I can't crack right now because
you don't actually have an approach to time invariant
domains. Go ahead.
Yeah. Well, I do know that like AI has
been showing behavior that's more and more goal, like, right?
And like it is a market incentive to try to train for
that, right? It's a market incentive to try
to create a thing where you can basically tell it like, hey,
make a web app for me. And then it just goes off for
six hours and like you don't have to think about it again.
And then you would get a web app at the end.
Right. Well, the question is though
there might be an MDL kind of argument here, right?
Minimum description length or like input complexity kind of
thing where there like, you know, the number of bits, of
course it's got like the web or whatever, it's got it all cache
there, right? So if you're looking up an
existing solution, a small input is enough to pull that out,
right? Like if you want a Sudoku
solver, you can just pull that out.
But if you're trying, the more novel it is that you're trying
to make something make it do, then the more input prompting
there's going to you're going to need and it's not going to be
like a one shot that just gets it.
Maybe that's my argument. Go ahead.
Right. But I, I guess saying in
general, right, the way, so my, like my, my, my prediction on
that is like for any particular category of thinking, like at
some point we are going to get to the point where AI has done
it, right? And the reason and we know it
cannot do it because humans have done it.
And humans are basically the result of like just storing some
molecules in a soup and then doing about two to the like 10
to the 40 computation steps of evolution, right?
That part so. So I'm not making the argument
that AI won't be able to think through bioinformatics or
physics or something like that. I'm making the argument that
it'll have to be prompted to do so because the prompts are so
high dimensional that they're a direction vector in a very,
very, very, very high dimensional space.
And so how is AI to search that direction and figure out what to
do for humans? It's basically like a
reproduction, right? So if you actually had the
Skynet scenario where you had robots that could dig out, you
know, data centers or whatever it was for the, you know, AI to
live and they could actually mine the ore and set up the
power generators. They get the full reproducible
loop where they set up the factories to turn out more
robots and have more AI to script it.
Then you could actually have something where I could have a
goal of reproducing or whatever, right?
Like a Terminator like scenario, but, and it's not impossible
physically, but the thing about that is probably prior to that
we probably have a lot of kill switches in these robots.
Like a lot of the stuff was like, Oh my God, it's going to
learn how to bust out-of-the-box and it's going to like run on
every computer like Skynet and and it's going to, it's going to
explode out of containment, right?
Do you still think that's possible?
I can give you arguments. That's why I don't think that's
possible in that way. Yeah.
And I think and AI getting out of containment like that part is
possible. I mean, I can say like what
parts of the, I don't know, the sort of the doom pipeline I'm
more skeptical of. So have you have you read the AI
2027 post? Yeah, but it's I, I, I, I'm I
like, I like some of the people there, but I've not I, I just
think it's. Why do you think it's naive?
For example, it assumes that it's like US versus China, and
there's a lot of things that it gets wrong.
In my life, but and so for me, like the biggest technical thing
that felt very implausible is that it assumes a world where
like the where within their universe.
Like they literally say this by January 2029, aging and cancer
are both solved problems like cure for aging, cure for cancer,
They're both listed under emerging technologies.
In this kind of world, it's absolutely impossible that we
will not have solved pandemics, right?
And like in 20-30, like basically it's assumed that the
AI kills everyone with super viruses, right?
And like, I think generally, again, you know, like those
kinds of argument, like the arguments, like they're at their
strongest when you try to like step back and go into the
abstract and you might say this question like, oh, well, see,
you know, you have no idea how stockfish is going to beat you
at chess, but you know that it is going to beat you.
But then the challenge with that metaphor is that if like if you
give, if you provide a handicap, right, Like actually if you
provide, if you take away a Rook from stockfish, then even today
grandmasters can a lot of the time beat like top ranking
stockfish AI. And if you handicap the queen,
then the grandmasters, human grandmasters just wipe the
floor, right? And so there is only so much
that a particular threshold of intelligence can actually give
you, right? So.
Well, to that, actually, one of the most interesting things that
I saw was was with alpha go, you could play adversarial input to
alpha go right? And you just beat alpha go
right? Meaning what that means is just
for the people who don't know this, like with AI image
classification, because the way it works, you can feed it an
image that's looks exactly like a dog, but a certain calculated
layer of static on top of it that's invisible to the human
eye. But that makes AI think it's a
cat, right? That's called adversarial input.
And to my knowledge at least, there's been no way of defeating
this. This is something which just an
intrinsic way of how deep learning works.
To my knowledge at least, I haven't seen a paper that does
that. So and that actually also
applies for example, to games. If you give an input to the AI
that's just way outside it's training data, you can win the
game of Go by doing something that's totally crazy that AI has
never seen before. And it's actually funny.
It's almost like that Hollywood movie intuition about AI is like
you do something that the robot, it goes beep, you know, and it
turns the wrong way because you're doing something very
human that it can't expect. Right.
And so to your to your other point about like the cure cancer
type stuff. This is in my view, people, you
know, I have this concept of the never see a book of like God
state network, like what is the most powerful force in the
world? These are people who have
substituted like AGI for God, right?
And what they do, I think is they really, really underrate
empiricism. And like, I know something about
biotech, you know something about biotech.
You need to whatever theory you have.
And you might be able to actually do a lot in terms of
taking all existing papers, indexing them, digesting them,
coming up with theories on the basis you can do a lot with
that. For sure.
It's by medical text mining. But then you have to test those
theories. You have to actually go and have
test tubes and you have to actually see if it works.
And you just won't know if it works.
You're actually going to be able to intuit.
You might have a theory, but you have to do practice.
Go ahead, give me your thoughts. Yeah.
And I I expect that sort of thing to be like a not not an
issue at all in sub domain some domains, but then a huge
bottleneck in other domains. Yeah, well, embodiment and
experiment are massive bottlenecks on the I huge.
Like they underrate the physical world dramatically.
They underrate an experiment dramatically.
Like for embodiment, I mean, if like if you look at, you know,
like the even the current bots right, then like they already
have a lot of advantages, right? Like I think if right now we had
to bet on who would win a karate match between like a human and
Tesla optimist, like, what would you say?
I mean, like a gun would. Machines have been humans for a
long time, right? I don't know, actually.
Like a karate match. I'm not sure how agile they are
actually. I've seen the videos of them.
I think they'll eventually get there.
Yeah, they'll get there. Well, I think realistically
they'll beat us on totally different domains, right?
Like air is the big one. Right.
OK, So when I say embodiment, what I mean by that is you have
to manufacture the robots. You have to have them be
economically feasible. You have to transfer them to the
location. I'm not saying that these are
unsolvable problems, but the friction of the physical world
is radically like basically what we need to do for some of these
scenarios to happen is you need to have as many humanoid robots
as there are smartphones, right? Like a billion of them.
And that means you have to crack all kinds of business model type
stuff. I mean, it'll eventually get
there, but it's it's something where the people are like, oh,
cure AI by 20. I just don't think their
timelines are correct. And I also think, I mean, So
what do you have to have? You have to have a a robot that
can do all the experiments that a human could do.
They're at a bench, they're running those experiments, They
have the reagents, They have to have the whole supply chain for
them. This is just stuff which is
friction that just doesn't move as fast as the Internet.
And I think they're underrating that.
Go ahead. So I actually, I mean, I do
think that there's enough of a risk that this stuff will happen
very fast, the fast for us to worry, right?
And I mean, like, I think probability of more humanoid
robots than humans by 2040. I think it's like very non 0.
I agree with that. I think it's funny over the last
2 1/2 years, I feel like AI is being both overrated and
underrated. And here's why I said like
obviously it's ridiculously important and that's since
underrated. I think the long term is right,
but in terms of it's like, it's funny how people are actually
using AI in practice is they're just like being extremely lazy
and using ChatGPT for essays, right?
Or like it's amazing how many people will just like literally
have ChatGPT write their tweets. And I'm like, the only thing I
can tell, it's like, you know, there's like a rhetorical
question mark and a it's not this, it's that, you know, kind
of thing. There's go ahead, right?
There's certain things they do where it's like actually, I want
a plug in which Chrome plugin? Maybe some of you guys can code
this. That's like is under score AI
that runs AI detection on every string on a, on a site and then
gives you a link. Because what'll happen is if you
say to somebody that posts AI, sometimes they'll be like, no,
it's not or whatever. And sometimes it actually isn't,
you know, right. And it's kind of like an
accusation of you're dumb. That's AI, they get offended or
whatever, right? And and so there's like a lot of
secret AI. And so if you run is AI, you get
like an either scan link and it'll tell you why that was
likely to be AI, not either scan, but a link that's like
that a permalink. OK.
And then you paste it and you're like, is AI, you know,
probability 73% and you reply to that on X and it's like, did I
like, let me AI that for you or not AI that for you, right?
And I think so. So, So the way it's being used
is like a not all, but it's like an idiocratic version of it,
right? The smarter you are, the better
you use AI and the Dumber people are or the less taste they have,
the worse they use AI, right? But that's it just feels very
different than any emergence path of AI that's being in
science fiction or literature or anything like that.
Go ahead, give me your thoughts. Yeah.
And I think the emergence path of AI has violated expectations
in just like all kinds of different ways, right?
And, and so I mean, even, I mean, like it just repeatedly
keeps on doing that, right? Like if you think of like even
the 1970s, like they like they would not have expected AI to be
able to solve arbitrarily complex arithmetic in like 10
years, but take like 40 years to tell a cat from a dog, right?
And and then like even today that like the line of what are
the things AI can do and what are the things AI can't do as
like very difficult to describe, right?
And I think one of my theories is actually that the task, the
last tasks that humans will be able to do better than AI will
be precisely the most illegible ones, because those are the ones
that are the harvest to train for.
And so, yeah, so actually what is your list?
Because I'll give you my list. I mean, it's interesting.
I remember talking to someone, he asked me like what is your
like benchmark for when you would say, yeah, this is AGI And
I said when an AI is able to independently start a profitable
company. Interesting.
Yeah. So everybody's got, I think I
would argue we've already passed, quote, the threshold of
AGI in some sense for some domains, Like it's better at
math than many people. It's better at, right.
Yeah, it'll make mistakes, but people make sick with math.
You know, it's funny. These two questions, what can't
AI do and what can't China do, I think are the most important
questions for anybody who's doing a new startup, right?
Like, or like you build your business to assume AI or China
will improve towards that. And then you'll ride with that
or at least be invulnerable to that rather than the opposite,
right. So the, I mean, the thing that
I'm seeing is AI right now for and maybe for the indefinite
future, it doesn't do Polish, right?
So it can, it will actually, you know, the whole thing about AI
takes a job. So here's a reframe, which a
reframe which is AI lets you do any job at an OK level, right?
You can be an OK artist, you can be an OK video editor, you can
be an OK 3D designer or whatever.
You can at least get your vision out onto paper, right?
And it's like kind of getting to like A5 level or something like
that. It might be a cheesy generic
version, but you can do any job. So in a sense, AI means a crude
form, not crude improving form of digital autarky, so long as
you have access to the Internet, right?
And China is physical autarky because they're the most
physically independent country in the world because they can
build everything themselves, right?
So that's how I kind of think about it.
But it's not getting really good at that area because the
threshold for really good keeps moving forward as AI improves.
And to actually check the result, it might generate a math
theorem. We actually have to be a
research mathematician to even understand the symbols and check
it. Go ahead, give me your thoughts.
The mental model I use is like if human level is like
normalized at like some level like this right across a range
of tasks, then basically AI kind of looks like this, right?
It's like better in some domains, worse than other
domains. And like this curve just keeps
shifting to the left and like often very wobbly and
unpredictable ways, right. And so it's like it's, it's, I
think for 50 years, it's been super huge.
Like from OK, from the perspective of the economy in
1800, by the like probably the year 2000, we basically had here
like ASI from the perspective of like probably over 80% of the
economy, right? Like if you think of farming,
what percent of that was automated even by the year 2000,
if you think of manufacturing, right?
And So what I think is happening in the pattern that will
continue for a while is basically this pattern where
essentially both economic and social value, they continually
refocus on the subset of tasks that AI hasn't just
hyperinflated to 0, Right, right.
And I mean, at some point we're gonna enter a new a regime where
like that set of human dominant tasks, like actually shrinks to
exactly 0, right? But we're not there yet.
The question is what? What happens when they
eventually get to the point where they can like think 100
times faster than you and at the same time they consume like 0.1
watts of energy and stuff? There's still comparative
vantage, right? I mean, or rather, I guess
that's a question, does comparative vantage between AIS
and humans exist? And you can argue there isn't
any with dolphins, right? Like dolphins are just pets,
right? Dolphins use kind of feed, food.
There's nothing you can really delegate to them.
They just can't figure it out. Whatever, you know, like go, go,
go, go have have fun, right? So it's possible that it gets to
that level. But I think at least until the
prompting issue is solved, right now, it really appears to me
that it's like artificial intelligence is just constrained
by human intelligence. Like, you know, it's, it's
basically like the better you are prompting, the better the AI
is. And and conversely, go ahead,
even if you spell something wrong, it gives you a worse
answer. Right.
Yeah, yeah, yeah, I, I, I fully agree with.
That's the status quo today, and probably at least for the next
couple of years. Yeah, OK, fine.
All right. So all right, so let's move to
maybe talk about one more thing and let's go to questions.
OK, Startup societies, Zuzilu and so on and so forth.
So after the network state book came out, you actually, there's
actually an old diagram I had and then you kind of moved one
more box on that diagram. Go ahead.
Why don't you talk about? That, yeah, basically.
So the box was, I mean, this was actually originally, yeah,
right. The diagram from your book,
which is basically how many people are there and for how
long a time do they come together, right?
And so it's like number of people, 200,000 million.
And then amount of time like one day, one week, a month, a year.
And then you have like Tinder over here and then you have
eHarmony over here, you have universities over here and then
countries over here. So with this a little like the
idea was that OK, we've had lots of things that happened where
people come together for a week, but there's this like a big
discontinuous change that happens.
I think when you one, you allow the duration of time to get
longer, like basically the psychological shift that
happened. And so that, and I'm sure a lot
of you can probably relate to it at this point, is that a week is
a break from your life. Two months is your life, right?
Like, yeah, like if you stay in a place for two months, like
actually fully readjust that being the normal, right?
And it like actually becomes a day-to-day rhythm as opposed to
something like, you know, you've done a few days and there's a
few days left and then you're gone.
And then on the other side is like scale, right?
So, you know, like there's what you can do with like 10 people,
which is a hacker house. But then there is what, what can
you do when you get to like Dunbar's number, which is 150.
And that's the level at which you start to just need to have
multi level structure in your society, right?
And so like two months at 150 is like this level where you
actually start to get a lot of the complexities of doing
something more meaningful at a larger scale.
But at the same time, it's like still small enough that it's
practical to bring together and it's manageable, right?
And so we've seen that I mean, Zeus a little was about 200
people for two months. I think it's a good range within
which to experiment. And I'll try to figure out what
are the actual kinds of things that we can do.
And the general way that I see this, right is that like, I
think this is a good scale at which you can dog food.
Things at which you can actually like start to go from from
having some new idea about how a civilization might work better
to not just like blabbing about it on the Internet, which is
what people did on Internet forums back in 2009.
But like, actually try it out And you actually get like real
world information about where the successes and failures are.
One of the things that such things, people in the community
develop things for the community, right?
Like the community puts their beta testers or what have you
for different types. Of things it's a full stack
incubator right exactly and like basically I think there's a big
difference between like being a service provider and being a
community right I think like for example, this is probably one of
the things that the whole E Estonia movement of 10 years ago
got wrong right which is that. Like they had very advanced E
government for their time, right?
You know, you could vote online, open up bank accounts online, do
like start companies online, all kinds of things really advanced.
But the difference between a product and a community is that
a product is a hub and spoke model.
It's N people who have a one to one relationship with some kind
of center. A community is a model where you
have people that all have relationships with each other.
And I just like in Estonia, I think the problem was that or
for Estonia, there was not enough commonality between the
different people who were Estonia residents for them to
actually really become a cohesive community.
Right. Yeah.
Exactly. It's like community is
connectivity. That's actually how like
literally of N people, you have N choose two possible
relationships or n ^2 if they're asymmetric.
And then you divide how many relationships actually exist by
the number of possible relationships.
And they just had a hub and spoke thing where everybody was
connected to Estonia but not to each other.
Right. And so I think that like one of
the unique things that sort of community as incubator can do,
right? It's like it actually gives you
a community as a beta test user. And there is like a big, the
difference between having 100 beta testers and having a
community of 100 beer beta tester, right?
And the difference basically is, it's the difference between 100
people who have no preexisting relationship and need to
interact with each other versus people who do have a lot of
those needs every day. And so this is, I think to me
like a very unique value proposition, right?
That you can actually start a thing and then you can
bootstrap, incubate it in a community and then you can
actually make a huge amount of progress together.
That's right. And I think, I do think the
startup society, this has a concept like what you're doing
on the Zizzle's side, we're doing in our school, we're
helping bootstrap others. I think this is the third type
of thing, like intranet company, intranet currency, intranet
community. You know, I've said that before,
but I think it's like the third type of thing that you can
start, you know, go ahead. Yeah.
So one other thing that we started doing in Zizzle and that
we've and I think also like gotten in, we really have been
in a long time right as biotech. And I think it's interesting
that like crypto has had this kind of interesting sort of
sister relationship with Frontier biotech from pretty
much ever since it began, right? Like definitely far from just
myself, a lot of early crypto people were also a very big into
longevity do. You have my thesis on why.
Go ahead, you know. So, well, Hal Finney was an
extropian, right? But I could actually give an
exact parallel between crypto and and longevity, which is what
with with Bitcoin, initially it looks like the existing
financial system, but it in some ways with bar charts and trading
and stuff, but it rejects fundamental premises because the
existing financial system says that while hyperinflation is
bad, deflation is also bad. So you should lose a little bit
of your wealth every year, like a little bit of inflation is
good. That's normal.
And the the medical system is similar.
It says while fast death is bad, right, like trying to live
forever, like deflation, the equivalent of that increasing
your lifespan every year, that's also weird and bad.
So you should lose a little bit of your health every year via
aging, right? So the traditional financial
system says lose a little bit of your wealth every year.
Traditional medical system says lose a bit of your health every
year, right? And the entire crypto and
longevity community says, what if we reject that?
What if we attack it from first principles and say like maybe we
don't have to go to 0, maybe we can get to Infinity instead?
The nice thing about longevity, right, is that I think it's on
this like really nice trajectory toward being much more
mainstream now, right? Like, yeah, Brian Johnson is
like a mainstream cultural figure, like non-technical
friends of I think many of us know who he is, right?
And, you know, there's been a huge amount of progress on that.
And I think 1 space that I think is like still in an earlier part
of the curve is resistance to airborne diseases.
And I mean, we had a dry run of this during COVID, right?
And like, COVID is worse than existing diseases, but it's also
much less bad than it could have been.
And like it was in this weird mid zone where basically it was
not bad enough for us to like properly take it seriously, but
at the same time like it actually is much worse.
You know, there's this concept on Twitter sometimes of the
secret third thing. Have you heard of that before,
right? And essentially, if you guys
don't know this meme, it's like, are you a Democrat or Republican
or or a secret third thing? And it presumes that you must be
in one of these two categories. And otherwise, you know, it's
like a fake thing that there's any more complexity than just
zero or one, right? But obviously, if you look at
and I'll get to my point and say, if you look at like an
image, you know, an image has more than one pixel of
information, right? And like if you only had zero or
one, you would be able to describe an image.
And some things have necessary complexity more than just zero
or one. It can't be reduced profitably
to that. And I think with COVID, for
example, one way of or crashing the operating system of some,
some people online is they're like, on the one hand, it's like
this dangerous virus had escaped from a Chinese lab and you know,
it's like so bad and so on. So for the other hand, it was
just the flu, bro. And it didn't do anything.
And why are you so mad, right? Why do we do anything about it,
right? And a lot of people hold both of
those beliefs at the same time, right?
They're obviously incompatible with each other, right?
Where either it's like this fairly serious thing or it was a
completely non issue. And I think it was actually
fairly serious and it did come out of a Chinese lab.
I mean, it's not the word was, right?
It is very serious, like was. Slash is exactly that's right,
and it killed literally millions of people.
But, and this is a weird thing. See, The thing is in early 2020,
if you had said, OK, just warp your way back to January 2020,
if you said this is going to kill 10 million people globally
and a million Americans, and in a few years it's not going to be
that big a deal, OK? That's literally how people are
thinking about it, right? That's which is actually kind of
if you had said it's not a big deal or it's going to kill
millions of people, those who seem like thesis antithesis.
And somehow we got a synthesis, which is totally crazy, where it
literally killed a million or millions of people.
And it's also considered like, dude, you're just exaggerating.
It's not a big. It's kind of like life goes on
after World War One. Well, it does for those who
didn't die, right? But you know, it was actually a
pretty big deal at the time, right?
Go ahead. Right.
I mean, though I think in one of the important things they are
right aside like COVID itself is still an ongoing thing, right?
Actually, yeah. I mean, I got it quite recently.
Yeah. I'm actually, if I if it weren't
for that, this whole thing would have been happening like a week
and a half earlier. But based, you know, it's still
happening, it's still bad. Like the long term symptoms are
still pretty bad, right. And if you think about just like
how our civilizations media apparatus is handling it, like
from a media perspective, COVID basically ended on 2022 February
24th, right? Like that just is how our media
like apparatus works, right? Like you can only like handle.
One big story. Think about one big story at a
time, right? And the reality, of course, is.
The current thing? Basically, yeah, exactly.
Like there are multiple current things, you know, COVID was not
cured, there were new variants, the efficacy of the vaccines
went down to about 1/4 and like basically, yeah, the and then
the scarier thing is what could come come next.
We basically have to get ahead of all this stuff when we have
to massively increase our civilizations vital defense.
So like I think in the UK there was a wastewater surveillance
program that's like very good and like the the smart
technocrats on both sides will tell you that it's good.
But then like pretty much sometime 2021-2022, it was just
cancelled and. I mean, I think the problem is,
unless the next pandemic literally photographs like Ebola
or something like that, God, hopefully it doesn't.
There's people who will just literally deny that they,
they've gotten to the point they'll just deny the germ
theory of disease. You know, they just don't even
believe that. Like, you know, any not, not not
that a vaccine works. They don't believe any vaccines
work. They don't believe drugs work.
They don't believe biotech works.
They don't believe pharma works. And you're there's, there's
totally throwing the baby out with the bathwater.
Go ahead. Yeah, I mean, well, it's.
I've got 2 solutions for that by the way.
Sure, OK. What are your solutions?
So the two two solutions, and this is actually true for
everything. The two heirs to American empire
are China and the Internet. And so for example, when it
comes to biotech, like if you look, China actually flipped the
US and the rest of the world in like science papers, nature
papers, like highly sited biotech, like they have a
functioning replacement for American academia.
And like if you want to know whether like they're not as
political about or not political about it at all.
So if a treatment works or not, like a Chinese clinic, they will
basically be able to tell you about a crazy left or crazy
right version of it. So that's one possible solution
that's for, you know, within China.
And the other solution is the Internet where I think with
Desai, right, you can have people who are neither, you
know, crazy people. Like the whole thing about, you
know, in mid 2020 where people are like public health people in
the US destroyed the reputations by saying, you know, racism is a
real pandemic and you need to go out and protest and so on and so
forth in the middle of a pandemic and just completely
vitiated all their guidance on lockdowns or what have you.
This made people completely distrust all US public health
and then, you know, the right then saying that vaccines don't
even exist. So both sides are just
completely crazy about biotech. They're completely crazy about
biology. So the answer is either China or
it's the Internet. So you have D side decentralized
science, diagnostic self experimentation, Brian
Johnsonian, where you're measuring your own body and
taking responsibility for your own health.
You've got the air quality metrics, you've got the personal
sequencing, you've got, you know all of this, you've got your own
dashboard and you're working with a community of people of
like mind to get to scale where you can aggregate, create that
data. You can start calculating.
OK, as my numbers, are they out of sync?
Are they In Sync or what have you, right.
So those are the two approaches I think to like a rebuild
biotech and just assume the solution is outside America, go
ahead and. What's interesting to think on
like some of this bio stuff is how a lot of the solutions are
surprisingly low tech, right? Like we're like basically, so we
know this lamp here, this is a UV lamp, 222 nanometer light.
So if it's under 3, like about two like 300 nanometers, that
means it's like actually like fine for your eyes and so on.
So it doesn't like hurt you the same way as sunlight ultraviolet
does. And what it does is it kills the
viruses, right? So it just passively like
basically significantly reduces the chance that people in the
room are going to infect each other with any airborne
pathogen. So this is like, this is 1 type
of technology. Another type of technology is
air filtering. 1/3 type of technology is just better
ventilation. Like there's really basic things
that can be done. And like the big bottlenecks are
like what? Like a lot of the time the
bottlenecks are just like people getting off their butts and
doing things right. And to me, this is also part of
the value of some of these like startup societies, right?
That you can actually take things that like really the
smart people know are obviously correct and then you can just go
and do them right? Because a lot of the time for
mainstream adoption of these kinds of things, like the
bottleneck is not like it's not about the technology.
The bottleneck is like from a politician's point of view, is
this something where they have to go do something untested or
is it a copy paste job? So this is very, very, very
important because basically startup societies are deployment
points for exactly the obvious cool high tech stuff that we can
now deploy at 100 or 1000 units scale.
Because it's like it's something where people have opted in to
basically pushing the frontier of tech.
And they can, of course you can. You know, not everybody has to
opt into a DNA test and everybody has to opt into an air
monitor. But the kind of people here are
going to be more interested in that kind of stuff because it's
like the frontier of health, frontier of tech.
So go ahead. Why don't we take some
questions? Actually go, yeah, your auto
slide out if you want to pull it off.
All right, great. So why didn't you build Ethereum
anonymously like Satoshi? If you could go back, would you
do that? I think it would have been too
hard. Like the problem is that by the
time Etherium started I was already a Bitcoin magazine
author for two years and like 1. I just like put way too many
words on the Internet. I would have been findable.
And two is I think like Ethereum's beginning really did
like my ability to get any kind of critical mass.
I think definitely bootstrapped a lot off of people already
knowing and trusting me from Bitcoin Magazine.
Like it would have just been a way harder job.
A non obvious point is pseudonymity is itself a form of
decentralization. And the reason it is, is because
like your government name is in a government database, so it's a
centralized name. It's linked all the information
value you punch into a search engine.
It pulls up everything on John Smith, whereas Satoshi Nakamoto
is a decentralized aim that's outside of that, right?
So in a sense, pseudonymity is itself a form of
decentralization. They couldn't hit either the man
or the ball of the network, right?
But once Bitcoin was out there, it was like a heat shield for
you. It's like, you know, the NASCAR
or Indy 500, Like, you know, you can kind of kind of like
slipstream behind a car, right? So you didn't have to use
exactly the same tactics. Similarly, the network state,
personal distribution is important.
So the way that we're doing decentralization is lots of
startup societies. So it's not just like
Vitalikville or Balaji Burg or whatever.
I want many of you guys to set up your own startup societies.
We'll fund those. There's many different visions
of the good, right? And, and so that's
decentralization of another form rather than pseudonymity.
Go ahead. Well, what's interesting to me
about like the whole 0 knowledge proof thing in particular,
right, is like it opens up the entire design space, right?
Like if you remember like 15 years ago, the whole narrative
is like basically the dichotomy between sort of trusted
institutionally because KYC versus on the Internet, nobody
knows you're a dog and the challenge now, of course.
ZK reconciles. That the challenge now of course
is that if you don't prove you're you're not a dog, then
you're also not proving that you're not a bot.
And so like, there's no reason for people to listen to you,
right? And so, but, but what the zero
knowledge proofs gives you is they give you the ability to
have privacy, but at the same time have have reputation.
And so like, and that what that also means is like you actually
have an incentive to like, say and do things that are
constructive because they increase your reputation.
And that's a reputation that you haven't can use in a future
context, despite the fact that all of this reputation is being
mediated through ZK. And so like actually every
operation is unlinked from every other operation.
And I think like, you know, 0 knowledge is definitely
underrated. And if you're, if you're going
to spend, if you're early in your career, that's, I don't
know, there's some things, I think ZK biotech, things like
that haven't had had their massive breakout moment yet.
And ZK is definitely one. OK, here's another one.
This is you'll like this one. OK, What are a list of some 1000
to 1 or 10,000 to one return public goods that we could or
should have but don't? And I think one of the things is
just like more kind of like standard form packages for
things. And so if you wants to like
start a guest, if you want to start a startup society, and
then like, here's like open source software that you can
start with, here's like the the 12345 guide of what kinds of
things you should do if like you wants to do something like,
like, say, yeah. You know, like me thought
through templates. Yeah, exactly.
Like thought through templates for like pretty much everything
is a big one. And also, I think on the
education side, the biggest underprovided thing that I think
I've identified and even a lot of my writing has been about
trying to compensate for since the beginning is you've probably
seen a lot of this with math, right?
Like you have a bunch. On the one hand, you have papers
that are technically accurate, but they're just like so
insanely complex and everything and like freaking Greek and like
nobody can understand it except for people that have had in
person conversations with the original authors.
And then on the other side, you have like pop sign mat, like
stuff that just doesn't even try to be accurate, right?
And they tell you things about how, oh, Schrodinger's cat means
that like the cat can be dead and alive at the same time.
And like, you know, absolute, like that sentence gives you
absolutely no intuition whatsoever about like, what is
the point of, of, of quantum, right?
But like it makes you feel smart because you know the password,
right? And so, you know, there's like
an entire space that's like in the middle there that like
actually tries to like give you the intuition and like helps you
understand things, right. But then, well, but in a way,
it's like actually understandable to people.
And in general, like if you're creating educational resources,
like to me that's like a huge unclaimed operable like space of
opportunities to provide value like, and that repeats itself
for pretty much everything that's emerging.
Yeah. And I think we want to do a lot
of that in network shape. So here's a good one and maybe
you can give an answer and maybe this may be something we
disagree on maybe or not. Approximately 99% of stable coin
market cap is backed by dollars. This reinforces USD seven of ten
large BTC owners or US entities. How does the US not win if
crypto wins? So you can give an answer and
I'll give mine. I mean, first of all, right,
it's like all of these things are chaotic systems that just
have a huge number of all kinds of different variables going in
all kinds of different directions, right?
Like five years ago, China was the winner of mining and then,
you know, the governments itself, like just finally bans
mining hard enough that I think actually China still does 10
about 10% of bitcoins hash power, but it's like basically
knocked out over the number one position.
And so all kinds of things could happen, right?
And so you know, the and there's even all kinds of things that
the US could do with respects to crypto, right?
And then obviously then you know, the, there's all kinds of
things that even like the individual crypto holders in the
US could end up doing, right? So that's one.
And then two, like macroeconomics can just go in
all kinds of different directions, right?
Like we're basically breaking an 80 like an 80 year era of
stability and about like 3 different ways at the same same
time and the. What do you look at as those
three different ways? There's the name, the tech of
AI, and so on. Yeah.
I mean, I think like basically like domestic politics,
international politics and AI. And I mean, even AI itself, like
you can expand that or like basically like thinking in terms
of like technology exiting the great stagnation in general,
right? So, you know, I think we've been
seeing bio exiting the great stagnation.
We've been seeing virtual reality exit the great
stagnation. Like a lot of these things also
really feed into each other, right?
So basically from like there's just a lot of the Internet is
also a big one. Like the Internet has just
changed a lot of variables in terms of what kinds of things in
our world have an economic premium and what kinds of things
don't. And so the like, what dominates
can just change massively over the next five years in
directions that pretty much nobody has been predicting is, I
think one part of my answer and the other part of my answer is
like, once you're on crypto rails, your ability to go from
one thing to another thing just becomes 100 times easier.
Great. So that that leads directly to
my answer to this question. So actually I, I, I should do a
I'm going to start doing video tweets, OK, Meaning like 59
seconds, 29 second vertical videos.
So one of them will be on the D Phi matrix.
OK, so D Phi matrix is if you imagine the table of every asset
across every asset, right? So you have Fiat currencies, you
have cryptocurrencies, you have NFTS, you have domain names, ENS
domain names and so on and so forth.
All of them now due to Uniswap and due to all of these on chain
market makers and exchanges have a price like you can get out of
this asset into that asset and you can do it right now and you
can do it for the whole thing. You can market sell, I mean.
Do that, but you can do that, right?
An so the moment that you loaded the dollar on chain, you made it
swappable in a million different venues at any time of day and
night by anybody in any country at some price, right?
It's like putting something onto an ice skating rink and it can
move in any direction with very little friction very, very,
very, very quickly at the speed of crypto, which is like that,
the speed of the Internet. It's not banking hours, which
are 9 to 5. It's not capital controls.
It's not within the control of the US banking system in the
same way. It's at the speed of the
Internet, right? So that alone is a huge change,
which is the, you know, sometimes something is
forklifted into a new domain and it the forklift itself,
everybody's focusing on it for a while, but it's now in a new
domain and the physics are totally different.
The Internet is totally different.
So the D Phi matrix, because it means you can swap in and out of
something that actually means what's another term for people
use for cash? They call it liquidity, right?
Getting liquid an IPL, right? That's like how a tech bro says
like, you know, I'm making money.
OK, So the like liquidity can now actually happen without
actual cash because you have an asset that you can just swap in
to whatever asset you want with a click.
There'll be some price for that, but you can keep it all in
Bitcoin, you can keep it in something else.
So that's number one is that means, by the way, here's the
very important thing. You know, it was similar to the
D5 matrix. An analogy is in the early
2000s, OK, there were all these newspapers, OK, And they
forklifted themselves online. And there was just like the
online version of the New York Times and the, and the, you
know, Miami Herald and San Francisco Chronicle, they just
forklift themselves. They're like, OK, I'm online.
What's the big deal? I'm online, I'm offline.
But once they were all online, Google News could make a table
of all of them. And suddenly when you loaded
Google News, you saw they were all reprinting the same story,
the same Reuters clip. And they didn't have unique
stories. There was like 73 outlets
reprinting the same Reuters clip.
And suddenly everybody realized, oh, wait a second, these guys
just have a thin layer of like local news on top of basically,
like wire services. And so that began essentially
the commoditization of local news and local news basically
died, right, Because you could just get your news on the
Internet. The forklifting revealed that
these were commodities and their previous modes that they didn't
even realize were modes were the geography because they had
trucks that delivered the newspapers, they had ink.
That whole saying of never argue with a man who buys ink by the
barrel. It's actually now you know, you
can always defeat a man who still buys ink by the barrel.
They can. They can't argue with you,
right? You don't have to buy ink by the
barrel, right? So the point being that what
they didn't realize is that by forklifting it online, they'd
lost their Moat. And then they were put into
total global competition with everybody else.
And then all the local newspapers died and only the
strong survived. And the craziest, you know, most
international news or whatever, you know, dominated.
That is what's going to happen to every Fiat currency.
Every Fiat currency is now in a war for its survival comparable
to local news because their only advantage was their geography.
They're basically all doing the same thing as everything else,
right? It's only the geography that
provides any advantage for a Fiat currency.
So what that means is they're now going to have to, if you
think that would happen with local news or the news, it, it
couldn't compete on geography. Instead it competed on ideology.
You have all of these online different niches and verticals
that are global, but competing on ideology as opposed to
location, right? OK, So that's what's going to
happen with assets already happening.
They're going from competing on geography, like, you know, this
Fiat and that Fiat, to competing on ideology and on features
which are like, you know, 0 knowledge or like smart
contracts or like on printability of Bitcoin.
That's already happening and you're having tribes form around
them. What hasn't happened is for many
fiats to die. Many fiats are going to die.
This is my view, right? When many fiats die, lots of
things break because it's a tool for social control and so on.
And Bitcoin will moon more than you can imagine it can moon and
so be in a safe country at that time.
And so then the to the other point is like, how does the so
that's how like basically with the stablecoin market cap.
And then so it doesn't reinforce USD exactly.
It just makes it very liquid and it can swap into anything else
and you can easily have some other asset that you swap into.
And then in terms of seven of the 10 largest holders are, are
American. Well, the, the issue is that the
US is not, it's not the United States, it's a dis United
States. And so everybody's just taking a
chair and using it against the next guy.
And the red team says the blue team did it, which they did.
And the blue team says the red guys just did it.
So which they did. So even Delaware is being
destroyed, right? It's like a civil war where
every institution in the US is getting wrecked, right?
And then the Internet survives because the Internet is what
stays up, even the time of nuclear war.
So the only reboot is from the Internet.
That's not the US winning. That is the Internet surviving
after all these institutions get melted down, which is a very
different thing. And fundamentally, I think the
fundamental optical illusion that you want to wrestle with
this is the Internet American, right?
It's like saying, is America British?
On the one hand, of course, America is British.
It was born out of Britain, speaks English like, you know,
the early columnist, the names of towns, George Washington, all
that kind of stuff. On the other hand, it's clearly
something that's become much more than Britain.
It's exceeded even it's worthy progenitor.
OK, so I want to do a few more and then maybe two more than
we'll wrap. Right.
OK. So, all right, this is a good
one. How can we, how can we mega, how
can we make Ethereum great again?
All right, if you or if you maybe have a different slogan,
so massive tariffs on all uniswap trades out, you know of
Ethereum, right? OK, fine.
No, how can we make Ethereum great again?
What should Ethereum's North Star Gold be?
Number of Dow's price total holders, etcetera.
Yeah. I mean, I think Ethereum in
general like it needs to have like twin, like the twin goals
basically are like 1 is like getting used and and getting
used at a large scale. And the other is, of course, you
know, continuing to sort of be something that's worth being
used in the sense of, you know, being something that's
meaningfully like much more secure and much more
decentralized and so on than the kind of the kinds of systems
that people would be using otherwise.
And obviously, I think if we sacrifice on either of those
things, there is no points, right?
Because if Ethereum can't scale and it can't provide enough
security and it can't provide enough experience, then like
whatever properties it happens, they don't reach anyone.
On the other hand, if Ethereum gets scaling and UX at the cost
of like basically becoming a copy of Treadfi, then like there
is like, there's also either no points or at least like much
less of a point than there could have been, right?
And so the question is, how do we?
Argue that point. OK, my argument is sometimes you
can have something that's cyclical in the XY plane, but
the progress is on the Z axis. So even if you rebuild, like for
example, there was Microsoft and there was Google and then there
was Facebook and there's like, even though they're like new
guys, same as old guy, they're not exactly the same.
There's actually progress technically.
Like React is better than Angular for example, right?
Go ahead. Yeah, Yeah.
OK, that is fair. But I mean, I think there is a
strong technical road map that gets us both of those things,
right. And the technical road map is, I
mean, basically there's a bunch of strategies to scale both L1
and L2 execution, right. And I mean, we've talked like
there's stuff like delayed block, block execution, block
level access lists, distributed history storage, like stuff that
I think there was like a pretty good bank list podcast with
Ethereum researchers about some of these kinds of things about a
week ago. And so on the old one side.
And then on the old two side, of course, increasing the number of
blobs and using PR dots to be able to handle that.
And then finally a using ZK snarks and I guess realistically
Starks inside of the old one for scaling.
So just like actually applying all of that, all of that
technology, and I think there are things that we have to kind
of rethink on a fundamental level and be to update some of
the ideals from some of the early Satoshi era, right?
So like, probably the biggest thing is that like the thing
that Satoshi did not understand that well is the asymmetry
between creating and verification.
And it's ironic because in proof of work, like you actually
totally did, right? But if you think about every
other aspect of Bitcoin, right, a block takes as much
computation to like create, not the proof of work part, but like
the part of choosing the contents and what right as it
does for someone else to verify, right?
Like the cost that it takes, the amount of computation bandwidth
that it takes to run a verifier is exactly the same as what it
takes to actually choose the contents of the block in the 1st
place, right? And that was an inherent
limitation of the pre Zeke Snark era, the pre Stateless client
era, the pre, you know, like access list era, like basically
the era before all of these different scaling concepts have
come up. And there's the way that all of
these scaling concepts work is they basically say, well, they
put more load on one node and they ask the one node to do more
work in order to create hints that then make it the work of
verifying much, much easier for everyone else, right.
And so the like taking advantage of that asymmetry, right?
That is what sales clients are about.
It's what Zika Starks are about. It's what data availability
sample is about. Like basically all of the fancy
buzzword technologies are ultimately some version of this,
right? And the challenge is like early
Bitcoin mentality really valued this concept of like running a
node at home, right? And the challenge of like, the
good aspect of this is like, what you want is you want a
system where the rules of the system are rules where like the,
if those rules start getting broken, the, the blocks that
break the rules just automatically get rejected by
everyone immediately, right? Like Swift does not give you
that property, right? Credit cards do not give you
that property. Like if I get like have AUS
dollar balance, I have no way to verify that these resolvers
created with an algorithm that'll base any particular
limit on how many dollars are in existence, right?
And so you, what you do not want is you do not want a system
where like 5 people can get together, they can change the
rules and then everyone else accepts them by defaults, right?
You want to we're changing the rules is actually hard, right?
This is like constitutionalism, but like a level above that
because we're like basically going into smart contracts and
doing it at the level of tech, right?
And so to do that, basically the Bitcoin way was to say, well,
you'll have everyone reexecuting everything at home, right?
But with snarks basically have to say symmetry.
You have the difference between nodes that are responsible for
building the chain and nodes that are responsible for
verifying the chain. And then you have a whole
spectrum in the middle, right? And the question is, well,
actually, if you allow the cost of building parts of the chain
to be a little bit higher, then you can massively increase the
scale and you can increase the scale.
Is it basically you can increase the number of users who actually
get to benefit from your chain's guarantees directly, right?
Like this is one of those things that like mistakes that El
Salvador made, right? It's like the Lightning Network
implementation, like it was actually based on custodial
wallets like that, but. So on that I'll say something.
But like, basically the question is like, how do you avoid that,
right? And basically the solution is
like, well, you basically have this kind of hub like model
where you have a smaller number of more powerful nodes and like
you're concentrating the proving work and at the same time you're
massively distributing the verifying work, right?
Basically the challenge is like, if we can actually do this, then
like we actually can like create something that is sort of
maximum decentralization and maximum scale at the same time.
And the technology exists to like actually do that, right?
It's funny because that is like 10 years after Bitcoin.
It would only have come up after people pushed on that part of
the directory. One thing is I do think Bitcoin
scalability, it's not lightning. I'm I'm very skeptical and
something's about, but it actually already exists, which
is it's either A, an infrequent on chain transaction or B, it's
an off chain transaction to something like Coinbase or
Binance or El Salvador or whatever that just runs
essentially off chain transactions between it's
people. So you have infrequent digital
gold movements between these hubs and then you have like all
these spokes on these hubs. And that's basically how Bitcoin
scales. My critique of that kind of
stuff is basically that if the like open permission, less
censorship, resisted aspects of the ecosystem are not aspects
that can be that are experienced by users directly and we just
say those things belong to institutions, then that's just
something that's inherently more vulnerable to capture.
OK, last question then. Let's wrap some Say Silicon
Valley SF is losing its supreme position as central tech
founders. Do you agree?
Yes, no. And if so, where do you think is
the best place to start a global startup?
I think it depends on your industry, right?
Like like if you're in AI, then spending a lot of time there
like is like very helpful. I mean, I think like my personal
philosophy toward that whole region is like, there's a lot of
value you can get by being part of it.
But like, I think if you go visit for two to three weeks a
year, then you get the majority of the benefit and you've you at
the same time, like that's still a low enough dose that you can
like avoid imbibing the crazy. I think a lot, a lot of parts of
the world are great places to be based in, right?
I mean, if it's like places like Berlin, like I'm always a big
fan of Berlin because I think the local community does a great
job of like remembering what crypto is actually there for,
right. And like basically, not just,
you know, like chasing like the, the short term narratives.
There's a huge amount of top tier talent, right?
Like even like safe, like the the smart contract, while people
are there, huge numbers of Ethereum core developers are
there. So there's a lot of like
different parts of of the world that are like this.
And so I think especially with a combination of the Internet and
with a combination of more localized net like in person
network effect hubs like this, you're the like the need to be
in a global superstar city to be at the front of the world is
much less than it was five years ago.
I agree with that. All right, with that, let's
wrap. Thanks, everybody.
Thank you for your time.