I saw Joe Lubin speak about Ethereum at an event in late August.
I didn’t know who he was. What I noticed most of all was how patient he was answering question after question from people after his talk.
It makes sense to me now where that patience comes from after watching his keynote fro the recent Ethereal SF event. His vision for the Blockchain, Ethereum, and the “venture-production studio” he founded called ConsenSys, is both deep and broad.
Clearly, the Blockchain, tokens, and cryptoeconomics are animating so many people right now becasue it’s literally allowing us to create a better Internet, redefine money and assets, and potentially engage everyone and everything in a new type of value exchange.
And of all this in a world that badly needs it.
Personally, I keep looking for the key elements of the Blockchain and its tokens so that we can help it take off and achieve “escape velocity.”
When you hear Joe talk at Ethereal SF, in the video below, these elements become vividly clear. He talks about
- Building a future consisting of decentralized economic, social, and political systems
- Why it’s valuable and necessary to enfranchise all of the people on the planet
- By building a global society of ubiquitous stakeholders, people’s lives will be grounded in something they care about
- From that base, people can build their own future, which builds our collective future
And in the second half he talks about unfreezing capital, how organizations of all kinds are working together to build a shared infrastructure, how governance is poised to radically change, and why this all leads to an economy that creates much more value more quickly.
It’s a low key but fascinating keynote that points to a blueprint of this rising “Internet 3” and tokenized economy. It’s just 24 minutes long and well worth putting down your phone and watching!
How’s this for a simple definition of Ethereum in today’s New York Times:
“Ethereum is a global computing network operating according to rules defined by Ethereum software.”
Maybe that’s a little too simple.
But the article follows that up with a description giving you a better feel for it, which is “a global smartphone that can be programmed to operate according to the apps built on top of it.”
If you want to jump into the deep end of the genesis of Ethereum, I highly recommend this Wired piece titled “The Uncanny Mind that Built Ethereum,” profiling its founder Vitalk Buterin.
It has a really straightforward description of the blockchain and Bitcoin, which was to remove third parties from both the creation and transfer of currency. This was accomplished by recording payments (Bitcoin) on a new type of open ledger (blockchain).
The success of the Bitcoin blockchain made it obvious to Vitalik Buterin, and others, that you could use the blockchain to facilitate transactions and complex agreegments for anything (e.g., deeds to houses).
He realized the right type of blockchain network “could deliver every imaginable digital service, right out of the box,” and this idea eventually became Ethereum.
Vitalik recently spoke at Disrupt SF 2017 and this is how he described Ethereum:
Where Ethereum comes from is basically you take the idea of crypto economics and the kinds of economic incentives that keeps things like bitcoin going to create decentralized networks with memory for a whole bunch of applications.
In other words, Ethereum uses incentives in a decentralized network with shared memory to run diverse applications. Pretty simple.
The blockchain is out there waiting to be used.
But how can you use it to, as the Ecomonist said in 2015, as “a way of making and preserving truths“? I like that definition.
The blockchain potentially offers something radically new because of its inherent ability to make and preserve truth between us at scale.
How do we use it, though? What’s stopping millions of people from using it right now?
Fred Ehrsam gave one very good reason why in April this year, which is the blockchain needs the right elements, or stack, to support the development of the applications that people can use.
His list of elements in this developer stack are computation, file storage, external data, monetization, and payments. He scored these elements in that post and concluded the stack was 20% ready in 2014 and 70% ready in April 2017.
Fred followed-up that post with a more detailed one on June 2017. His feeling is that the blockchain, specifically Ethereum, which is furthest along, is still “orders of magnitude off from being able to support applications with millions of users”.
Yet, there is significant progress on scaling Ethereum, in his view, and we might see an app with up to 10 million users by the end of 2018.
One thing that will surely help this happen is the token aspect of the blockchain. Tokens mean incentives for eveyone.
Fred and Chris Dixon talk about why crypto tokens matter on a a16z podcast.
At the moment, I’m really interested in how you can use Ethereum.
Ethereum is a “blockchain app platform” often called the “world computer” because you can build any app on it that you can think up.
So I’m looking for ways I can actually use Ethereum to do something useful.
Balanc3, for example, is creating accounting tools for tokens. It hasn’t launched yet, but I love what they’re working on.
They realized that tokens and cryptocurrency aren’t currently tied to accounting and compliance systems. So “product owners and CFOs face difficulties in accounting for internal operations and ensuring tax compliance.”
Balanc3 has spent over a year building the token data streams, accounting system, and interfaces to ground crypto in real-world accounting. You can read their announcement about this accounting service. I’ll be watching for their launch to test it out.