[Audiobook] GreenPilled: How Crypto Can Regenerate The World

Transcript

green pilled how crypto can regenerate the world zeroth Edition by Kevin owaki pixels by Octavian trout forwards by get coin Dao Glenn Weil vitalik buterin Danny Ryan Balaji saranavasan and more audio narration by JT nickel audio editing by super synapse take the green pill and on the tldr humanity is faced with global scale coordination failures that create systemic risks to human thriving

our Legacy institutions are not equipped to handle these risks we reject the dumerism Left To Us by the Legacy generations and Legacy institutions we believe that web3 is a shelling point for the hopeful and we have come together to build a better world for Our Generation Our Moment of opportunity is here we can build a more regenerative Financial system by creating coordination games that leverage the properties web 3 has to offer Global transparent immutable and programmable Finance our weapon of

choice is novel mechanism designs based upon the sound Game Theory deployed to decentralized blockchain networks as transparent open source code we aim to eclipse the more prolific and more degenerative use cases of blockchain networks and ignite a positive feedback loop for their regenerative use cases by Green pilling tens of thousands of web3 native Founders Engineers designers and onlookers we are bootstrapping this virtuous cycle with education if we collectively choose and persistently reinforce this outcome as hope begets more hope and momentum

begets more momentum regenerative crypto economics could become inevitable for Generation Alpha may you inherit a world that is better than the one your grandparents did a word from the lawyers not Financial or tax advice this book is strictly educational and is not investment advice or is solicitation to buy or sell any assets or to make any financial decisions this book is not tax advice talk to your accountant do your own research

table of contents forwards from the frontier chapters 0 through 7 introduction why who when what how looking forward and get involved forwards from the frontier our vision is to establish an empowering open and collaborative space where individuals and communities can access resources independent of their geographic location education background or offline identity by creating collaborative decentralized

funding mechanisms git coin has become the Natural Choice for seeding and supporting public goods the Dow enables building for the public by the public we help individuals and communities start fund and scale open source projects We Are The evm Whisperers the Dao cartographers the internet citizens and the chaos magicians of the internet of money we are the shelling point for the hopeful we will continue to discover new and innovative ways to solve coordination problems in a Dao era world we

systematically uncover or invent these mechanisms and if we're lucky plus good we then scale them we are get coin built by the get coin community Austin Griffith the quadratic freelancer I was stuck writing closed Source tools for private companies for a decade after learning about decentralization and falling down the rabbit hole of smart contracts I started learning everything I could and I made sure anything I worked on was open source to be honest I probably thought I was going to get rich

building blockchain games but it didn't really turn out that way instead I fell face first into a rich community and loving ecosystem of ethereum Builders I struggled to get funding in the bear Market of 2018 and 2019 and was lucky enough to be supported by git coin grants vitalik buterin called what I was doing a quote quadratic freelancer end quote someone directly working for the public funded by donations boosted by quadratic matching subsidies I earned the equivalent of a full salary building education content tools and

prototypes on ethereum now I'm reaching a new phase of regenerative crypto economics where I'm streaming eth to builders I'm mentoring Danny Ryan proof of stake ethereum ethereum opens up a new realm of human interaction allowing for fundamental shifts in power value and organization this is why I've spent the majority of my waking hours for many years working to improve the ethereum-based layer and this is precisely the same reason I'm excited about green pilled the publishing of this book comes at an interesting time in ethereum's evolution

we are on the cusp of the highly anticipated transition of ethereum's consensus mechanism its heart and soul from proof of work to proof of stake this upgrade will immediately make ethereum more secure and environmentally sustainable while improving decentralization so that the platform is neutral and available for all participants across all contexts when evaluating a game a system of participants actions and Associated incentives we commonly assess whether it is positive sum for the immediate players but we often forget a key player in our assessment the Earth the future

of humanity sadly many economic games of Humanity's past and present have not traditionally accounted for this final player leading to profoundly negative externalities such as climate change to make matters worse we are rarely equipped with the tools to understand or better yet proactively designed for these externalities ethereum is slated to become a tool to allow us to better take control of our shared future energy hungry proof of work set this all In Motion opening up new massively positive some games but we can do better

proof of stake is carbon neutral while simultaneously improving security and decentralization this has been a long game coming but ethereum is finally ready to make the shift ensuring that the heart of the platform complements the green pilled future we are architecting on top Louis Taylor blockchains as Nations I'm a Believer in the future where blockchains economies are effectively Nations not necessarily because it feels right but it feels likely many people already conceive of ethereum as a nation but I see it much more broken down my

hope of course is that increasingly folks of exploited identity groups own their own currency and economies so you can imagine a world where if you want some strawberries from a sun-soaked industry where latinx workers tend the crops you must first purchase their currency you become a tourist in their nation which is arranged around shared interest rather than land and Military powers there's immense benefit to this any turn towards Justice is based on increasing the agency of the people most closely impacted by an issue

so while a crypto economic future makes you a tourist and having to play by the cultural rules of the true stakeholders in an issue it also realizes lots of financial dividends for them when people grouped around a shared interest can be a bank the lender the hedge fund The Exchange the stock issuer and regulator it is the shared interest itself that benefits from the gains of all those financial activities vitalik buterin the tragedy of the commons the vision of collaborative decentralization that guided the

original Spirit of blockchains like Bitcoin and ethereum is a compelling and Powerful one but it is also an incomplete one blockchains and cryptocurrencies by themselves are designed to support cooperation through private property and markets tools that work best from one-to-one interactions most of what is great about the internet however is one too many the very software that blockchains run on and the academic research and math that makes them work was written once and all of humanity can benefit such public goods are vulnerable to the

tragedy of the commons because they're available to anyone including you regardless of whether or not you personally contribute it's difficult to motivate people to contribute to them especially if far more lucrative money making opportunities are sitting around the corner building and sustaining such large-scale public goods well requires New Economic models and even a new culture Kevin and get coin Dow has been at the Forefront of thinking through these challenges and actively deploying and iterating on new ways to bring Democratic public goods funding on the

internet and Beyond to life biology cernavasan crypto civilization crypto Anarchy sounds cool but what we actually want is crypto civilization this means having two opposing ideas in mind that many existing institutions are Beyond repair and that we need new and trustworthy institutions that's a combination of merited cynicism towards the current system and cautious optimism towards the next one said optimism should be cautious indeed existing systems have the implicit

wisdom of chesterton's fence even when flawed there's often a reason they are flawed as public Choice Theory explains any naive approach may eventually land Us in the same pickle with corrupt institutions characterized by utterance of good intention and substance of bad result but what if we put things on chain what if we used all the new tools that blockchains provide to produce public goods in an adversarial environment where all parties know some Bad actors will try to game the system where on-chain actions are finally just as

perceptible as digitally signed words and where we develop explicit metrics for positive sum outcomes that's the promise of regenerative crypto economics like renewable energy of the nuclear variety it helps make crypto sustainable it's not zero-sum gambling or negative sum hacking it's positive some wealth creation and it's the win and help win of web 3. Griff green it's all coordination it's all coordination it always has been behind all the number go up number go

down d-gen drama on Twitter the web 3 regions are steadfast focused on addressing the systemic root of the major issues that face Humanity today our failure to coordinate around public goods coordination around individual wants and needs is effortless feedback is simple because profit acts as a shelling Point entrepreneurs can make a business plan seek investment and if they succeed everyone involved gets predictably rewarded this is why we can live in such individual luxury

the coordination required to put a cell phone in so many hands to pick one of an infinite number of examples was immense and impactful yet effortless because everyone who contributed was rewarded along the way if you want to create value for society or public goods like Building open source libraries or stewarding our lakes rivers and oceans you have three options bag sacrifice or both make a road map track your impact apply for Grants ask for donations if you succeed you will get what you need to

scrape by taxes and donations are the dominant funding streams for satisfying our Collective wants and needs even though these massive funding streams should be enough to provide abundant public goods for society they don't because they are difficult to coordinate taxes are distributed top down making the feedback mechanisms incredibly slow or non-existent donations are Market feedback but there is no Financial reward for success in fact they rely on unsustainable Sacrifice from donors

volunteers and everyone else along the way web 3 will change this we are building novel coordination mechanisms to create public goods while rewarding everyone involved Society has the opportunity to unleash the entrepreneurial Spirit into an open landscape of economic potential we can create economic games that make Collective value creation regenerative regenerative crypto economics is abundance economics take the green pill Anon Abby titcom A New Hope

as a domain crypto economics embodies many different alignments some would say that its Tendencies towards hyper capitalization and gamification are lawful evil others would argue they are chaotic good but then there are those who believe it's true good that its inherent qualities of programmable value permissionlessness and censorship resistant beget a path forward for Humanity as we seek to involve the global coordination problems that plague us these people see an opportunity to reconstruct the systems that control us

to use crypto to design deeply radical socioeconomic Futures where our societal values are not driven by extraction or accumulation but instead by a regeneration and sustainability while there is much work needed to achieve these Visions designing and maintaining positive some coordination games is a way towards a future of human thriving this book is a starting point a quest may be for those who seek to challenge the status quo it's the seed that will Sprout and grow to be The Binding force between us as we fight for and build towards a better future

regenerative crypto economics is not only coordinating the redistribution of financial Capital but social intellectual and cultural capital as well in their efforts they've become the stewards and maintainers of a movement A New Hope for public goods if you will Glenn Weil towards new forms of governance and democracy I am deeply ambivalent about web 3. much of the space is dedicated to tearing down social institutions that have been Central to supporting the development of

complexity and protecting the vulnerable all the vainglorious hope of replacing them with some speculative and highly simplistic new market-driven coordination on blockchains simple capitalist markets cannot support ambitious technology development or decentralization people in this space aspire to as they can only organize scale through Monopoly if we want to escape from the trap of building institutions intended for decentralization only to see them immediately captured Again by monopolies we need to get Beyond such simplistic thinking and build regenerative

institutions that support public goods and increasingly returns technology yet at its best web 3 can be one of the most creative and exciting places in the world for imagining these new forms of governance and democracy that can allow people to connect protect their common interests and build extraordinary new social fabric beyond the constraints of geography and history today's world has Global interconnections and local communities and patterns that could not have been anticipated by the founders of today's democratic nations and we need a new

substrate to make this kind of dynamic Democratic governance possible this is precisely what regenerative cryptoeconomics is about Kevin Hawaii has pioneered this space and has done a great job of capturing both its ideas and culture in this book one that I suspect will be a shining beacon in coming years as the many who are both thrilled at the potential of the space and terrified by its darker manifestations seek to find a path forward I look forward to continuing to work closely with him and seeing the next steps of social Innovation he and the

broader regenerative web3 ecosystem will help imagine [Music] chapter 0 introduction a quote from Audrey Tang my existence is not to become a minister for a certain group nor to broadcast government propaganda instead it is to become a channel to allow greater combinations of intelligence and strength to come together what is crypto economics crypto economics is the use of blockchain-based incentives to design

new kinds of systems applications or Networks crypto economics brings together the fields of Economics Game Theory psychology and computer science and leverages them in the creation of decentralized marketplaces and applications by focusing on the individual decision-making and strategic interaction between different participants in a digital ecosystem and by viewing them through the lenses of Game Theory plus mechanism design we can discover powerful new ways to fund design develop and Market applications and digital assets what is regenerative cryptoeconomics

this book is about crypto economic systems that number one satisfy human needs number two create positive externalities and are net positive number three create balance and find equilibrium regenerative crypto economic systems have resisted formalizations in the past due to the difficulty in doing so where possible we attempt to overcome this challenge by focusing on theories of human systems that are widely accepted complementary or Global in scope that said there are real contradictions in the emerging design space of regenerative cryptoeconomics there are

trade-offs to be made and there are members of this space that disagree with each other we Advocate a pragmatic approach that Majors results respects nuance and thoughtfully ways trade-offs first Do no harm the world is presently embroiled in a debate about the energy usage of proof of work blockchain systems like Bitcoin proof of work apologists have presented many claims that Bitcoin uses primarily renewable energy but until there is independently verified evidence these claims should be treated as spurious the carbon impact of the Bitcoin and

other proof of work blockchains is likely both large and profoundly negative until proven otherwise regenerative crypto economic systems are systems that are net positive and because of that this book focuses on blockchain ecosystems that consume 99.99 percent less energy per transaction than Bitcoin or proof of work era ethereum luckily there are many second generation and third generation blockchains that fit this criteria from this Foundation of near-carbon neutrality it is possible to create crypto economic systems that are extremely net positive applied regenerative crypto economics

regenerative cryptoeconomics is a subset of crypto economics which itself is a subset of Economics which itself is a subset of the study of social systems we are standing on the shoulders of giants in web 3. in this sense we are interpreting this web 3 wave of actors as more of an expression of a historically embedded process than anything novel in itself for this reason this book focuses mostly on applied regenerative crypto economics and on making the subject matter understandable to a more General audience in doing so we would like to acknowledge the

influences who have enabled us to understand the design space Plus have inspired us in our journey influences projects who have inspired us along the way in randomized order radical doing good Dev protocol regen Network block science give each common stack Tec Source cred code fund open Collective meta game kernel Z cash major grants the metacartel ecosystem Satoshi Nakamoto CLR fund maker Dao each

Global toucan protocol collectivo astral protocol cello Z cash curve Labs bankless govern rad Exchange one hive sporked out rainbow rolls panvala ens India coveted relief Simona pop ethereum Foundation deep adaptation forum collapsiology donut economics lab regenerative leadership groups MacArthur Foundation and many many others

resource consumption types for a graphic on this section check the screen as we Define regenerative crypto economics around what it is we should also Define it relative to what it's not extractive the resource is depleted and the system loses capacity over time sustainable the resource availability is not depleted over time and the system is steady resilient the system is able to recover from a period of shock regenerative the resources are regenerated and builds capacity sustainably while being resilient to

shocks regenerative cryptoeconomics can sometimes be resilient or sustainable but it cannot be extractive the building block and impact Dao is defined as any doubt that creates net positive externalities to the ecosystem around it impact Dows are the atomic building block of the regenerative crypto economic movement on energy usage Michael zargarm the founder CEO of block science provides this balanced analysis of blockchain-based energy usage quote pretty much every mode of economic

production consumes energy our Global energy appetite is growing and Bitcoin and more broadly proof of work blockchains are contributing to that increasing energy appetite it's true that an increasing appetite should incentivize more green Power Research development and production but experience has shown our responses reactive not proactive that is to say we remain behind the curve we need to be shifting off unsustainable power sources not just onto more sustainable ones all that said we should applaud Bitcoin miners who mine with local Renewable

Power by locating in regions with excess the same way we treat and other economic production that is actually successfully using green energy at the same time acknowledging that the overall proof of work is not special in incentivizing the behavior it's part of the broader Trend in increasing energy appetite so singling it out is also a bit suspect or political we should be holding economic actors including but not limited to minors accountable for their energy appetites this means acknowledging those who do the work to Source clean power noting that it's still hard but also criticizing those who do not do that

work again true for minors but also corporations and governments for those not familiar with the economics of energy transmission moving energy even with high voltage lines is lossy so there are remote areas with high natural energy production where excess exists but transporting it to where it's needed is too expensive and lossy to be feasible that's the power one can use to mine proof of work blockchains in good conscience intended audience of this book this book is a breadth first tour of ways to frame crypto economic systems to

be more regenerative the zeroth Edition is designed for those who already understand at a high level what blockchains are how smart contracts work and what Dows are if this book were a university course it would be a 401 level course if that is not for you that's okay welcome to the weird wonderful and wild world of web3 spend some time with the numerous and great resources about these fundamentals and come back to this resource after that it is possible that an incoat next edition of this book could be extended in future editions published in other languages highlight the most successful

experiments extended to a more beginner-friendly audience establishing a ratings agency or methodology for regenerative projects published like for real not just self-published the zeroth Edition is an alpha release after validating the idea on Twitter ayolo wrote this book as a side project between December 2021 and January 2022. they say if you're not embarrassed by the first version of your product you've launched too late ain't that the truth in the course of writing this book I have made many attempts to consult other Founders economists and designers within

and outside the ecosystem but I was not able to include everything I learned please excuse that I did not include your favorite idea or doubt please excuse brevity typos clunky layout or flow or other imperfections creating the next Edition will be a multiplayer game the zeroth edition of this book was written by myself Kevin owaki I spent many years thinking about it designing and studying regenerative crypto economics via my work founding git coin in 2017 and through the 50 million we have raised for building and funding digital public goods since then

this book represents the limited vantage point of one person therefore the zeroth edition of this book is an imperfect vessel for Education about regenerative cryptoeconomics for the next editions I envisioned that a diverse group of individuals could co-create resources about the regenerative crypto economics design space inviting a wider set of participants to contribute will enable us to explore the design space in a more inclusive more full and more decentralized way in order to facilitate this number one this book is licensed CC by 4.0 you may permissionlessly Fork this book make changes and republish

them with attribution as long as the proceeds go to the public good or charitable causes number two if you would like to join the community of writers and Educators forming around this book then please scan the QR barcode you see on the screen or go to the URL in the description all future links mentioned will also be linked in the description below [Music] chapter 1 why the gray pill a quote by John Gardner all too often on the long road up young leaders become Servants of what is

rather than Shapers of what might be the gray pill equals coordination failures coordination failure occurs when a group of humans could achieve a desirable outcome by working together but failed to do so because they don't coordinate their decision making examples of coordination failure nation states refuse to give up nuclear arms because they want to defend themselves despite the existential threat they posed to the world consumers refuse to give up fossil fuel powered Services because they want to get around conveniently despite the

existential threat fossil fuel burning imposes on the world users of Open Source software consume open source software because they want to build things faster despite the burnout the cumulative use imposes on OSS maintainers individual cells of the human body live harmoniously pooling their resources for the greater good of the organism but if a cell defects from this equilibrium it becomes cancerous eventually out competing all the other cells and taking over the body coordination failure can be a self-fulfilling prophecy for example if

one firm decides a recession is imminent and fires its workers other firms might lose demand from the layoffs and then respond by firing their own workers leading to a recession coordination failures are dictatorless dystopias coordination failures aren't dictatorless dystopias situations that each citizen including the leadership hates but which nevertheless endures regardless from a God's eye view of a system that has suffered a coordination failure there is a clear problem but from within

the system no one actor can create change every single citizen hates the system but for lack of a good coordination mechanism it endures coordination failures are multi-polar traps a multi-polar trap works as follows number one individual humans want to have a secure digital infrastructure two there is costly work to be done to develop secure open source software which underpins our digital infrastructure three since open source software is non-rivalous my consuming it does not stop you from consuming it and

non-excludable one cannot put clean air behind a Velvet Rope and charge for it there is no business model for the creation of Open Source software number four this means that each individual actor has a rational incentive to free ride on the system why contribute back to fund the maintenance of this software if I already get it for free this is the first trap the single player trap number five if enough actors choose to Free Ride the entire system begins to Bear a burden and if that burden increases to a point of systematic collapse no one gets

these public goods this is the second trap the multiplayer trap number six from a God's eye perspective the obvious solution is for everyone to do their part to support open source software but without a coordination mechanism that makes it rational for everyone to contribute they do not we Face Global coordination failures climate change is a coordination failure as individual actors in the world economy we make decisions every day to achieve our individual goals but the actions we can take cause carbon to be emitted and over time the collective

begins to feel the consequences of this through floods fires or increasing global temperatures and underfunded and insecure digital infrastructure is a coordination failure as individual actors in the information ecosystem we make decisions every day about what information to consume rarely do we think about the free and open source software that underpins that infrastructure our Global digital infrastructure is not well funded by governments as traditional infrastructure is and those free and open source software providers often do not have a business

model this creates a systemic lack of investment in maintenance of digital infrastructure at precisely a time in which we are increasingly dependent upon it there's many many more misinformation inadequate access to education inadequate access to employment overfishing the loss of biodiversity are all coordination failures what's at stake when your Coastal property floods due to climate change when an authoritarian is elected to power due to misinformation when a hospital is held hostage by

ransomware because of an insecure internet each of these create human suffering this local suffering is caused by global coordination failure the scale of the impact of these coordination failures is global but the impact is local name the enemy Malik coordination failure occurs when a group of humans could achieve a desirable outcome by working together but fail to do so because they don't coordinate their decision making why is it that when every single citizen hates the system but for lack of a good coordination mechanism it endures

from a certain angle it's almost like there is an all-powerful demon out there manipulating us to prevent our mutual success this shared psychic manifestation of coordination failure is Malik the god of human coordination failure Malik is the reason why we can't have nice things we name malark so that we may fight it to read more about Malik check out the excellent essay entitled meditations on mullark know thy enemy molach a quote from Sun Tzu Art of War

know thy enemy and know yourself in a hundred battles you will never be defeated when you are ignorant of the enemy but know yourself your chances of winning or losing are equal if ignorant both of your enemy and of yourself you are sure to be defeated in every battle the purpose of this book is to articulate the coordination failures we face so that we may know thy enemy once we know our enemy we are more equipped to defeat it choosing to face Malik as Humanity globalizes our coordination problems are

becoming increasingly globalized at the same time our ability to deal with these Global coordination problems is being challenged our generation has inherited decaying infrastructure declining faith in institutions or institutions that are not enabled for web scale nor for problems beyond their borders to face moloch we must first reject the dumerism we have inherited from our Legacy generations and Legacy institutions we need new coordination mechanisms that are equipped to the modern globalized world we need an Incorruptible coordination

substrate that is truly Global in nature to solve Global coordination failures we have found one we have discovered a device made of pure coordination and we choose to use that to fight coordination failure by fighting coordination failure we could slay Molech the god of coordination failure our weapon of choice web3 is a global immutable Incorruptible transparent programmable mechanism for human resource allocation for human coordination because web3 is a

foundation for coordination web 3 is a shelling point for the hopeful we have gathered in the web 3 movement to Build a Better World our Central organizing principle is that we don't have to live with coordination failures any longer our weapon of choice is novel mechanism design deployed to decentralized blockchain networks is it possible we could slay molec yes is it guaranteed no we need to choose it weed need to continuously reinforce that choice individually and build systems

that reinforce that choice systemically all coordination is a choice what we choose to do when presented that choice is up to us coordination failure the root of evil we have established that a coordination failure is a system that no citizen would choose but for the lack of a good coordination mechanism it endures this book takes the position that there aren't many people born bad out there instead we believe that people are born good made from 99.9 percent of the same

DNA as you and I who have been shaped by the systems around them to act poorly towards one another Henry David Thoreau once said there are a thousand hacking at the branches of evil to one who is striking at the root by aiming to systemically address coordination failures we hope to strike at the root the Degen to regen pipeline the meme degens came about during the defy summer of 2020 a playful adjective to describe the many many web3

enthusiasts who were yield farming on systems with high apis but also sometimes High likelihood of failure since then the Degen meme has come to mean anyone who is into web 3 for primarily short-term economic return driven by headlines about the bull market thousands of enthusiasts enter web 3 with the intention of making a quick buck anecdotally I've found that many regions came into the ecosystem through this path lured by the promise of better economic circumstances for themselves they tried

to enter the ecosystem to make a short-term profit over time they become more enamored by the promise of a Dao whose mission aligns with their own value set and their attitude and incentives shifted they start contributing they start learning to manage risk and ride the volatility [Music] chapter 2 who we Biddle for the get coin Dow mission statement we build for human thriving for a graphic on this section check the screen

we build for human thriving the opposite of coordination failure is coordination to some optimal coordination creates thriving for a small group of Elites to us optimal coordination creates human thriving for many we are designing a regenerative internet of value to enable the thriving of a diverse Global citizenry each individual on Earth is a three-dimensional human with differing values cultures Ambitions backgrounds geography psychological orientations Financial endowments privilege levels abilities and physical or psychological archetypes while we celebrate our diversity we also recognize our opportunity to address the

common needs that every human has Beyond just addressing these needs we aim to enable human thriving we build for a bento box of incentives instead of focusing on designing systems for instant gratification now me we propose that regenerative crypto economic systems that build for human thriving expand their design goals from gratifying me to gratifying us and from focusing on now to focusing on the future the result is a bento box of design goals instead of Designing for now me we also design for future US future me and now us

ancy strickler the founder of Kickstarter is the author of the theory of bentoism bentoism and acronym for Beyond near-term orientation is a wider lens for what is valuable and in our self-interest bintoism is the theory that self-interest is multi-dimensional to learn more about bintuism go to the Bento Society website at bintoism.org we build for public goods the stuff we all use but don't pay for and sometimes take for granted some examples would be fresh air open source software and public beaches public goods are non-excludable and

non-rival risks we build for needs outside of the financial one could be fooled into thinking regenerative crypto economics is only about Finance but it's not Finance is a key pillar of human society and a financial system could be designed that acts as a channel for greater human flourishing and greater combinations of strength and intelligence to come together to do that there are design criteria that must be defined Beyond just the financial the eighth circuit model of Consciousness is a hypothesis by Timothy Leary that suggests eight circuits of human consciousness and 24 stages of

neurological evolution to see a graphic on the eight circuits of Consciousness check the screen the eight forms of capital Gregory landua and Appleseed permaculture have published a great resource on the eight different forms of capital of which financial capital is the only one to see a graphic on the eight forms of capital check the screen we build for the cynics to the cynics I wrote this book for you I've spent time with you I've broken bread with you I've been called names by you sometimes I am one of you I understand that there is too much

energy expenditure in parts of the web3 ecosystem I understand that there are scams in web 3. I understand that hyper capitalism can cause harm I understand and believe that some truly awful people have fallen ass backwards into riches because of early investments in blockchain based systems I understand that you are lacking hope but let's not throw the baby out with the bath water there is genuine Net Zero emission Innovation here that is truly helping people after all if we had listened to the cynics in the late 90s who said things like the Internet is just for porn we would not have the internet today

we built to accelerate the good things already happening because of web 3. in many ways the regenerative crypto economics movement is in coet but there are a handful of good things that are already happening as a side effect of the web 3 movement number one there is lots of new pressure being put on big Tech to reform this market-based pressure is complementary to and separate from regulatory pressure number two there is new pressure to invest in Central Bank digital currencies and other means of creating more digital democracy number three there is an incredible community of talented and civic-minded individuals and that has opened the

conversational space around new political economies number four lots of money has poured into privacy Tech that wouldn't have otherwise number five access to Western financial instruments like the dollar in places that traditionally would not have access we build for the infinite Garden the web3 ecosystem has been described as an infinite Garden the vibrant communities of developers entrepreneurs artists and crypto enthusiasts who are traversing a new economic design space are rapidly evolving strategies to cooperate compete or coexist with one another the boundaries between these projects is

sometimes not clear all of these different diverse fauna are growing all over each other each trying to create as much success for themselves and their own ecosystem as possible we are in a Cambrian explosion of Finance where every Paradigm changing project launch can lead to hundreds of copycats each project implosion can lead to hundreds running in another Direction we are speed running the evolution of this ecosystem until we get to the crypto equivalent of mammals we build for donut economy to see a graphic for this section check out the screen the donut economy framework developed by

Kate rayworth is a way of understanding sustainable development visually it combines the concept of planetary boundaries the outer layer with the concept of social boundaries the inner layer in between the planetary boundaries and the social boundaries there is a safe space for Humanity to consume just enough resources to meet social goals without crossing the planetary boundaries there are web 3 projects that are working to tokenize resources in both layers which in some would allow markets to create the balance between the layers of the system we build to understand the hyper object hyperobjects are objects which have a

Vitality to them but you can't touch them their effects may be experienced even if they cannot be necessarily touched a hyper object can be an aggregation of networked individuals with the potential to produce profound and unescapable shifts in the conditions of existence web 3 is a hyper object many crypto economic systems are hyper-objects themselves we build for change of self and change of system when designing coordination mechanisms one should be aware of the delicate and sometimes complicated interplay between the systems being designed and the actors who will inhabit those systems in 2017 during the Ico boom there was an

over emphasis on change of system thousands of token designers took Charlie munger's famous quote show me the incentive and I'll show you the outcome literally and assumed if you took a human plus you put in a token you get an outcome turns out human beings don't work that way this is an example of an over emphasis on change of system conversely it is possible to over emphasize change of Self in a system with hundreds or millions of actors change of self can be a powerful Agent of Change but it can also be a drop in the ocean this book Advocates a balanced approach

it would be prudent for mechanism designers of regenerative cryptoeconomics to design their systems around individuals we build for a diverse tapestry of values one interesting opportunity in web 3 is to allow different communities to come up with their own currencies that reflect their own local values by allowing communities to participate in value system creation we allow them to articulate what is important to them the larger a currency may be the more it reflects Global or commodified values the end result of an Internet of all these local community currencies is like a tapestry of different value systems

each tapestry weaves the different socio-cultural economic and ecological games Norms crypto economic Primitives into a tapestry which represents the diversity and breadth of human value systems today this journey leads us from the more objective International sources of trust to a more subjective and local from the cryptographically verifiable energy expenditure in a remote data center that is today's proof of work to the communally verifiable delivery of life-sustaining care work that is tomorrow's proof of care and proof of plant and proof of Open Source contribution we build for game B

a quote from game B Wiki game B is a memetic tag that Aggregates a myriad of Visions projects and experiments that model potential future civilizational forms the flag on the hill for game B is an anti-fragile scalable increasingly Omni win-win civilization this is distinct from our current rivalrous game a civilization that is replete with destructive externalities and power asymmetries that produce existential risk yet game B is not a prescriptive ideology or an ideology at all while the eyes of game B players may be fixed on the same flag the hills are multitudes and the flag sits atop each and no

player individually is equipped to map a route in advance to learn more about game B check out the game B Wiki at game B dot Wiki or by clicking the link in the description we build for the homesteaders of the metaverse in 2021 the metaverse has become a hot buzzword meaning many things to many people to us the metaverse is a world increasingly intermediated by the digital in web 2 there are no digital property rights we were all serfs on Facebook or Twitter or Google's land in the web 3 metaverse The Hope is that there is true ownership of the digital by the

individuals who inhabited how does the web 3 metaverse get built without the massive war chests that the tech Giants use to subsidize the build outs of their metaverses regenerative crypto economics at scale would ensure a funding of digital infrastructure that is not owned by any Tech Giant by providing funding for the public good to homesteaders in the metaverse regenerative crypto economics will make it more likely that the web 3 metaverse wins we build for human thriving we build for a bento box of incentives we build for public goods we build for needs outside of the financial we build for the cynics

we build to accelerate the good things already happening because of web 3. we build for the infinite Garden we build for the donuts economy we build to understand the hyper object we build for a change to self and change of system we build for a diverse tapestry of values we build for game B we built for the homesteaders of the metaverse [Music] chapter 3 when our moments of opportunity a quote from R Buckminster Fuller we are

called to be architects of the future not its victims web 3 is a shelling point for the hopeful we reject the dumerism Left To Us by the Legacy generations and Legacy institutions we believe that web 3 is a shelling point a game theoretic focal point for the hopeful and we have come together to build a better world around it our weapon of choice is novel mechanism design deployed to decentralized blockchain networks by co-creating the shelling point we will reconnect with

why we are actually here and accelerate this Narrative of regenerative crypto economics web3 is a more solid foundation for human thriving web 3 is a global transparent immutable programmable substrate for finance This is Our Moment to build infrastructure for regenerative Financial infrastructure for the world the goal of this book is to document and teach the game theoretic Concepts behind regenerative cryptoeconomics 2.1 trillion dollars the value of the open source Financial system as of January 2022

what if we could use all of this capital for good the idea from first principles number one there's 2.1 trillion dollars in market cap in blockchain-based Networks number two it's all built on open source software a public good number three we can redirect some of that Capital to support the public good all of the money that used to go to some back office on Wall Street in the old Financial system will now go to open source software given the rational need to prevent Black Swan events like hacks unexpected downtime Etc by supporting the digital infrastructure beneath our digital

assets it should be possible to build an aqueduct to financially support the most necessary public goods with programmable money we can program our values into our money the idea from first principles number one we value public goods number two with programmable money we can program our values into our money number three we can make public goods sustainable financially with a touring complete smart contract programming language programmers can now design economic systems around their values

this is of course a double-edged sword as value systems can vary widely by aligning incentives of many participants system designers can create economies that externalize good as widely as possible we can create new non-scheuomorphic use cases of Finance the idea from first principles number one the internet brought us novel uses of Information Services for example we now use IM Twitter RSS or email more than we use the postal system number two the blockchain can bring us novel uses of financial services

number three what kinds of Novel uses of finance will emerge which one of those will be able to fund public goods or other human thriving skeuomorphism is the design concept of making items represented resemble their real world counterparts the most interesting and revolutionary uses of regenerative crypto economics will be non-scheomorphic they could not have existed before crypto economics did in the past trust networks were local in the old world trust was oriented around relationships which were based upon our Geographic locations on the internet we have Niche interests and our

networks of relationships are built around them we can now build Global trust Networks niches are the new nation states each Niche has its own network of participants and could one day have infrastructure for public good build around these Global trust Networks local networks versus global networks as trust begins to flow worldwide but we retain our physical presence there will be numerous confrontations between and Integrations between digital and Global networks of actors plus physical and local networks of actors we can build a financial system that

acts as a channel for greater human flourishing and greater combinations of strength and intelligence to come together no more tail wagging the dog as Humanity upgrades its infrastructure for the digital age the questions we must ask are is the new Financial system better than the old one number one is it transparent number two is it fair number three is it accessible number four is it captured by Elites old Elites or New Elites number five is it in service of the many or the few number six does it

invest in outcomes Beyond quarterly profit cycle number seven does it reduce suffering or increase it number eight is it in service of Greater combinations of human intelligence and strength to come together or is it only in service of itself number nine who is designing it and what are their incentives the constraints stack to see a graphic on this section check the screen let us take a moment to articulate the constraints stack of human civilization from mathematics to culture at the bottom is mathematics then physics power structures law Finance media and at the

top culture regenerative crypto economics traverses the stack from finance and law up because crypto economics can help monetize culture Media or Finance in novel ways it can be used to rewrite these portions of the stack to be more transparent immutable credibly neutral and Global in nature spiral Dynamics to see a graphic on this section check the screen spiral Dynamics is a model of the development of individuals organizations and societies developed by Dr Ed Beck and Chris Cohen it starts at the most human level of

instinctive survivalistic and moves upward into the magical animistic impulsive egocentric purposeful authoritarian achievest strategic communitarian egalitarian integrative Meme and the highest point of holistic meme spiral Dynamics describes how World Views and value systems emerge from the interaction of Life conditions and the people in them each value system is neither positive or negative but is a response to the local environment each value system may also be a response to the problems of the previous system the scope of spiral Dynamics is quite

Broad and is therefore beyond the purview of this book but there are many other excellent resources out there available including a book by Dr Ed Beck and Chris Cohen the four social revolutions hunter-gatherer the primary means of sustenance are wild plants and animals humans are nomadic and non-hierarchical agricultural the primary means of sustenance is the cultivation of crops humans settle down and become hierarchical industrial the primary means of substance is industry the mechanized manufacturer of goods social hierarchies

and division of labor become more complex information the primary means of substance is services or Information Services social hierarchies and culture become even more complex from the industrial to the information age as Humanity transitions from the Industrial Age to the information age we are in for profound shifts in-house Society self-organizes itself the first was the internet the internet of information 1990s to present changed everything in society that relies on information because computers could now

send information across a network without an intermediary everything that relied upon information media entertainment politics and news changed drastically as a result the internet of value 2009 to present could change everything in society that relies on value computers can now send value across a network without an intermediary anything that relies on value transfer Finance art gaming work public goods funding could change drastically as a result these shifts come at a time when there is profound mistrust in the Industrial Age

institutions that our parents and grandparents relied upon as technological Evolution exponentially compounds and our Democratic institutions evolve on a much slower time scale than the technology that is powering the choices of citizens or consumers that participate in government we have seen massive disillusionment on behalf of individuals who feel that the system no longer works for them will Democratic institutions be able to upgrade themselves to become more web scale and internet native in this regard many of us are following the lead of Audrey Tang the digital minister of Taiwan

digital democracy in Taiwan Audrey Tang's first initiative was called the gov zero project and it swapped out the O for a zero in the government's top level domain gov.tw to view more accessible and interactive versions of these government websites the project was open source which invited contributions from across the country and the projects were used millions of times per month another initiative V Taiwan used social media paradigms to create digital petitions petitions with over 5 000 signatures were brought to the premier

and government Ministries to be addressed changes implemented through this system include access to income tax software for non-windows computers and changes to cancer treatment regulations Tang practices radical transparency and all of her meetings are recorded transcribed and uploaded to a public website she also publicly responds to questions sent through another website Tang is a fervent believer in open data open governance and Civil Society government collaboration high bandwidth democracy we are at a critical moment when we Face

seemingly insurmountable challenges from growing economic disparity climate change and Global pandemic our governing systems are stifled with deepening polarization and that is halting progress Taiwan is seen as a model for how democracies could be upgraded for a more digital forward population an important example of a more digital democracy in a world that is turning more authoritarian to get involved in conversations about how to upgrade democracy for the 21st century we recommend checking out the rad exchange movement at radicalx change.org

the consent of the government in political science the idea of the consent of the governed is foundational a government's legitimacy and moral right to use its power is only Justified and lawful when consented to by the people or society in which that political power is exercised this is in contrast to the divine right of kings which had historically been invoked one problem with the powerful web 2 platforms is that they do not seek the consent of their user base for any of the changes that they roll out to the platform nor do they allow their users

to exit the system without a high cost regenerative crypto economic systems aim to do better by allowing users of the system to govern the system along with other stakeholders and to provide the ability to exit from the system if they disagree with the changes the ideal outcome is that these foundational investments in the consent of the governed create healthier communities over the long term we can go to the quadratic lands the quadratic lands is a mythical place where we've Rewritten the laws of Economics to support public goods prevent coordination failures and create

human thriving it's a place where the distance between value creation and value capture has been collapsed and so people work on things that create value instead of just those that can capture it by practicing regenerative crypto economics we can build a vessel to the quadratic lands we can build a more solar Punk future solar Punk is an art movement that envisions how the future might look if Humanity succeeded in solving major contemporary challenges with an emphasis on sustainability climate change and pollution

solar Punk is optimistic and fundamentally high-tech and high life it emphasizes a deep integration between rather than a separation of technology and the environment in addition to convivial conservation self-sustainability and social inclusiveness by practicing regenerative crypto economics we can build a more solar Punk future [Music] chapter 4 what designing coordination games an anonymous quote it's all coordination and it always has been

coordination games a coordination game is a type of simultaneous multiplayer game found in Game Theory it describes the situation where a player will earn a higher payoff when they select a coordinated path of action relative to another player's actions coordination games are built around Nash equilibria Nash equilibrium to see a graphic for this section check the screen a Nash equilibrium is a way to define an optional solution to a game involving two or more players if each player has chosen a strategy and no player can

increase their own expected payoff by changing their strategy while the other players keep their own strategies unchanged then it can be said that a set of strategy choices constitutes a Nash equilibrium if a unique Nash equilibrium exists for a game then all players can be rationally expected to converge to the state represented by the equilibrium it is possible for multiple Nash equilibria to exist in a game the prisoner's dilemma to see a graphic for this section check the screen the prisoner's dilemma is a category of

coordination game where the incentives of the players diverge and without a mechanism for coordination between players a rational player will choose their own benefit at the expense of other players here's how it works imagine two members of a criminal organization are arrested and imprisoned each prisoner has no means of communicating with the other suppose the prosecutors lack sufficient evidence to convict the pair on the primary charge but they have enough to convict both on a secondary charge simultaneously the prosecutors offer each prisoner a bargain each prisoner is

given the opportunity either to betray the other by Supply evidence that the other committed the crime or to cooperate with the other by remaining silent the possible outcomes are if player a and player B each betray each other each of them serves two years in prison or if player a betrays player B but player B remains silent player a will be set free and player B will serve three years in prison or if player a remains silent but player B betrays player a player a will serve three years in prison and player B will be set free or

if player a and player B both remain silent both of them will serve only one year in prison on the Lesser charge as betraying the other player offers a greater reward than cooperating with them all purely rational self-interested prisoners without the ability to coordinate Will betray the other only Mutual cooperation would yield greater reward but with no way to coordinate towards that it is not likely to happen zero-sum games a zero-sum game is a type of game in Game Theory where if one party loses the other party wins and vice versa zero-sum games can include

only two players or many many participants in financial markets the investment mechanisms Futures and options are considered zero-sum games this is because the contracts represent agreements between two parties and if one investor loses the wealth is transferred to another investor in a zero-sum game it is not possible for one party to advance its position without the other party suffering and equal and opposite loss positive some games positive some games in theory are those games in which the sum of the winnings and losses is greater than zero a net

positive like zero-sum games positive some games can include just two players or many many participants in positive some games it is possible for multiple parties or all parties to mutually benefit as regenerative crypto economics emphasizes games that are net positive it often involves designing positive some games in the past incentive systems were fragmented to see a graphic for this section check the screen Charlie Munger once famously said show me the incentive and I'll show you the outcome

as members of the world economy we are subjected to many different incentive systems daily we try to maximize our bank account balances so we can purchase private Goods we recycle to maximize our positive impact on public goods we can create new augmented and integrated incentive systems to see a graphic for this section check the screen oftentimes these incentive systems align other times they are misaligned with programmable blockchain-based economic systems there is a new opportunity to design crypto economic incentive systems

to be aligned with one another when incentive systems are aligned more economic agents will take the aligned actions than before what if we could align the incentive systems between public private and common goods to create more human thriving our mind's limit dunbar's number to see a graphic for this section check the screen dunbar's number is a cognitive limit to the number of people with whom one can maintain stable social relationships dunbar's number was first proposed by Dr Robin Dunbar who proposed that humans

can only comfortably maintain 150 total stable relationships a stable social relationship is defined as a relationship in which an individual knows who each person is and how each person relates to every other person dunbar's number has since been broken down further into number one five close friends number two 15 super family number three 50 Clan number four 150 tribe Beyond these limits stable social relationships have not been traditionally possible technology is a bicycle for the Mind

Steve Jobs once famously called computers a bicycle for the mind because computers allowed one to become more efficient and go further in one's thinking similar to how a bicycle allows one to go physically further if computers are bicycles for our mind do they offer more efficient thinking more efficient communication more efficient trust if so it should be possible to maintain stable social relationships with a higher number of people if technology could 5x the number of stable social relationships the median human can have how would that change the

social economic graph of the whole world bentoism Beyond near term orientation Yancey strickler the founder of Kickstarter is the author of the theory of bentoism bintuism an acronym for B yawned near-term orientation is a wider lens for what's valuable and what is in our self-interest bentoism is the theory that self-interest is multi-dimensional instead of focusing on designing systems for instant gratification now me we propose that regenerative crypto

economic systems that build for human thriving expand their design space from me to us and from now to Future to learn more about bentoism go to the Bento society's website at bintoism.org expanding the bento box traditional Bento boxes contain four cells now mean now US future me future us this concept could be further extended with more granularity future could mean tomorrow one week one month one year one decade one century or

anything in between us could mean two people five people fifteen people 50 people 150 people an entire city nation or world and everything in between when designing coordination games it is possible to create games that are net positive across this entire expanded bento box designing for the evolution of trust three things to build towards repeat interactions possible win-wins low miscommunication when designing coordination games

to build mechanisms that are not fragile designed for mechanisms that are easier to defend than to attack for example cheaper to coordinate than to defect examples in eth2 proof of stake this principle is at work because it is cheap to defend the system and costly and risky to attack it in our information environment the incentives are broken this is because it is cheap to spread misinformation but costly to correct it this is captured by the old Trope a lie can travel Halfway Around the World

while the truth is putting on its shoes the Matthew effect the Matthew effect of accumulated Advantage is sometimes summarized by the adage the rich get richer and the poor get poorer the concept is applicable to the cumulative advantage of economic capital but can also apply to matters of fame or status or other types of resources because the Matthew effect is a repeatable pattern in human social systems economic systems will typically consolidate in the hands of a rich Elite beating the Matthew effect the Matthew

effect is a fundamental law of economic systems but that doesn't mean that it cannot be mitigated just as the Wright brothers defied physical gravity when they invented the airplane we can build economic systems that counteract the Matthew effect web 3 Founders can defy economic gravity in this case the consolidation into the hands of the rich and the few with thoughtful design just as the Wright brothers defied physical gravity when they invented the airplane we can build economic systems that counteract the Matthew effect web 3 Founders can defy economic gravity in this case the

consolidation into the hands of the rich and the few with thoughtful design there are three ways we can design to compensate against or fundamentally counteract the Matthew effect when building regenerative crypto economic systems one do not externalize harm two favor one person one vote instead of one token one vote or three leverage other regenerative mechanisms in our design public goods are non-excludable and non-rivalrous to see a graphic for this section check the screen free writer problem

if you give people the choice to support public goods or not rationally self-interested people without a coordination mechanism will often free write on public goods if enough people free ride the whole system collapses due to lack of support this is why many regenerative crypto economic problems attempt to solve the free writer problem public good funding Administration problems number one administration of public goods can be high overhead number two governments are not efficient vehicles to administer public goods number three

governments are coercive number four anytime you've got a pot of money you could have the capacity for corruption in the administration of said Goods many regenerative crypto economic problems attempt to solve these problems by creating efficiency verifiability and scale in administering funding campaigns eight principles for managing a Commons one clearly defined boundaries two congruence between appropriation and provision three Collective Choice Arrangements four monitoring five graduated sanctions

six conflict resolution mechanisms seven minimal recognition of rights to organize eight nested Enterprises Eleanor Ostrom was an American political Economist whose research centered around the governance of common resources her research focused on common natural resources like fishing Timber irrigation water for Farmland land for grazing but also more intangible resources like information for each of these resources it is expensive to control and fence in consumption the problem with these types

of resources is they may be over exploited or at least their care and or sustainability can often be overlooked by users Ostrom showed that within communities rules or institutions can emerge to ensure a sustainable and shared management of resources importantly these institutions were bottom-up and efficient from an economical point of view on legitimacy vitalik buterin the founder of ethereum describes legitimacy in one of his blog posts quote legitimacy is a pattern of higher order acceptance an outcome in

some social context is legitimate if the people in that social context broadly accept and play their part in enacting that outcome and each individual person does so because they expect everyone else to do the same unquote legitimacy is a pattern that emerges naturally in many coordination games and it informs each agent in a coordination's mental model for what they can expect other agents to do the ways legitimacy is created or destroyed are number one legitimacy by Brute Force number two legitimacy by continuity

number three legitimacy by fairness number four legitimacy by process number five legitimacy by performance number six legitimacy by participation when designing regenerative crypto economic systems legitimacy is an important design goal for more on legitimacy check out vitalik's excellent blog post a link is included in the description opportunity for a graphic on this section check the screen in the analog Financial system it's hard

to fund public goods a collectivist favorite without taxes which individualists loathe in web 3 we can design new mechanisms which fund public goods without taxation since this creates an opportunity for a healthy mixture of autonomy and interdependence it also creates an opportunity to build cultural Bridges between individualists and collectivists when designing regenerative crypto economic mechanisms look for expression of individual preference within the context of the larger Community Collective

dowels equal unbundled governance of public goods for a graphic on this section check the screen in the Legacy World many public goods if they are maintained at all are bundled into a handful nation-state government in the digital world public goods can be unbundled into many Dows that interoperate with one another within the Dow ecosystem in 2022 many projects are beginning to emerge that export public good one example is ens A system that supports the discoverability of actors in the ethereum ecosystem with a freely

available public good ens they have released a scarce governance token called ens to govern the system [Music] chapter 5 how coordination mechanisms an anonymous quote our weapon of choice is novel coordination mechanisms deployed to decentralized blockchain Networks the mechanism that started it all to understand the opportunity that web3 presents you must understand the Breakthrough that created the

opportunity that is web 3. the root problem with conventional fiat currency is all the trust that's required to make it work a central bank must be trusted not to debase the currency each individual Bank must not lie about its balances but the history of Fiat currencies is full of breaches of that trust to remove the trust inherent in the financial system Satoshi Nakamoto the inventor of Bitcoin needed to solve the Byzantine General's problem the Byzantine generals problem describes the difficulty that decentralized systems have in agreeing on a single truth and was a problem that plagued

monetary systems for a long time until the invention of Bitcoin byzantines generals problem the game theory behind this problem is as follows several generals are besieging a town called benzantium they have surrounded the city but they must collectively decide to attack if all of the generals attack at the same time they win but if they attack at different times they lose the messages between the generals may have been intercepted and deceptively sent by their enemies how can the generals organize to solve the problem Bitcoin solved this game theoretic

problem by using a proof of work mechanism to establish a clear objective rule set for the blockchain in order to add information or blocks to the blockchain a member of the network must publish proof that they invested work into creating the block this work imposes large costs on the Creator and thus incentivizes them to publish honest information because the rules are objective there can be no disagreement or meddling with the information on the Bitcoin Network the rule set governing which transactions are valid and which are invalid is also objective as is the system for determining who can Mint new

Bitcoin funding generation mechanisms inflationary rewards a web 3 based system can create inflationary rewards from its monetary Supply and use those funds to support public goods this can be powerful if demand for the system is growing faster than inflation but dangerous inflationary devaluation can occur if not philanthropy the generous donation of money to good causes for altruistic reasons typically the desire to promote the welfare of others early get coin grants rounds were funded this way

nft sales the birth of nfts has given art a business model and for those with cultural capital the creation of cultural Assets in the form of nfts has proven to be an effective way to raise money for the public good get coin grants round 9 through 11 were partially funded this way sequencer fees the optimism L2 network has pledged to donate 100 percent of their early sequencer fees to the public good of the ethereum network since optimism does one hundred thousand dollars per day in sequencer fees this has been a very successful way of funding public goods

transaction fees prominent D5 protocols have implemented fee switches into their protocols which if turned on could be a power funding generation mechanism for the public good data as a labor what if we treated the consumers of the web as creators and owners of their data web2 is funded by advertising and web2 advertising networks like Facebook have become hugely profitable by selling advertising what kind of new opportunities would it provide to fund regenerative economics to give everyday citizens of the web the ability to Route economic upside for

their data any other economically exothermic mechanism any other mechanism that's used in defy nfts Dows or otherwise to generate protocol Revenue could be directed to public goods funding generation mechanisms and funding distribution mechanisms are two sides of the same coin funding distribution mechanisms quadratic funding a way to allocate the distribution of funds for example from a government's budget a philanthropic Source or collected directly from participants based on quadratic voting

defined on the next page retroactive public goods funding a scheme to retroactively reward those who have contributed to public goods based on what a group of domain experts vote on the core principle behind the concept of retroactive public goods funding is simple it's easier to agree on what was useful than what will be useful molec Dao a minimum viable Dow design that invented a quote Rage Quit unquote a means for members to exit the Dow by exchanging their shares for a pro rata claim on the treasury's assets ecosystem

participants can fund a molec Dao and easily exit their fund via rage quit if they disagree with the Dow's decisions web of trust the creation of a graph data structure of who trusts who upon which data about who is creating the most value can be gleaned this inter-subject data can be used to allocate tokens used by coordinape and Source cred Universal basic income a socio-political financial transfer Concept in which all citizens of a given population regularly receive a legally equal Financial Grant without a means test typically designed

to give participants stable Financial footing from which to pursue other goals Aqueduct a conduit built to transfer water in the internet of money aqueducts have been set up to directly transfer one percent to projects like git coin radical drips or the protocol Guild some projects that receive aqueducts decide to pay their revenues forward to other projects creating a series of multi-level aqueducts voting mechanisms ranked Choice voting an electoral system in which voters rank candidates by preference on their ballots

number one if a candidate wins a majority of first preference votes he or she is declared the winner number two If no candidate wins a majority of first preference votes a candidate with the fewest first preference votes is eliminated first preference votes cast for the failed candidate are eliminated elevating the second preference choices indicated on those ballots number three a new tally is conducted to determine whether any candidate has won a majority of the adjusted votes number four the process is repeated until a candidate wins an

outright majority quadratic voting a collective decision-making procedure which involves individuals allocating votes to express the degree of their preferences rather than just the direction of their preferences by allowing the voting mechanism to take into account the degree of preferences a more optimal expression of preferences can be achieved conviction voting offers a novel decision-making process that funds proposals based on the aggregated preference of community members expressed continuously by allowing the voting mechanism to take into account conviction a more optimal expression of

preferences can be achieved mechanisms continued staking a way of putting tokens at risk in order to express conviction in a specific thing at an individual level or secure a system at a system level staked funds are subject to slashing of stakers or the objects they stake upon misbehave bonding curve a scheme in which the price of a token is determined by its Supply the more tokens that have been distributed the higher the price and vice versa typically used as an elegant mechanism to manage scarcity and price

Community inclusion currencies are assignable credit obligations redeemable for goods and services these can be issued by communities to develop sustainable local markets when National currencies are scarce fractal Dow protocols they make subsidiarity easier to implement subsidiarity is critical for scalable informed participatory governance Orca one Hive swarms are examples natural capital-backed assets strictly necessary to align regenerative Finance with physical natural world not

just social economic World curve labs and Collective vote formerly curadou are piloting these mechanisms continued multi-sig wallets multi-sig wallets allow a group of in people to control the actions of a cryptocurrency wallet if M of the N people agree on a single transaction on a transaction by transaction basis worker co-ops a co-op is a group of workers who have United to meet their common needs and operations through a jointly owned Enterprise co-ops have been around for a while but

what is new in web 3 is the opportunity to allow them to hit web scale or go global data co-ops a group organized for sharing pooled data from online consumers between two or more companies within a data Co-op members offer their data to the collective which creates an opportunity for more economic leverage for the sale of one's data than any individual Collective member could have minor extractable value the maximum amount of value that can be extracted from the Block production process in excess of the standard block rewards and fees tangibly this means that block

producers can reorder transactions in order to front-run other transactions which in some cases can lead to a lot of profit mechanisms continued Harbinger attacks a mechanism that allows an ecosystem to strike a balance between pure private ownership and total Commons ownership of a resource number one citizens value their own property and pay tax on that value a self-assessed tax number two at any point in time anyone else can buy the property from you at that price forcing a sale lossless

lotteries a way of running a lottery such that even if you do not win the lottery you get to keep the price of admission into such Lottery by allowing users to stake funds in a lottery and then using those funds to generate yield and rewarding the winner of the lottery with those yields lossless lotteries are able to create a positive sum way of generating funds for winners but without taking funds from the losers unsolved problems and opportunities money Legos composability is the interoperability of different pieces of the internet of money such that they could be assembled

like Legos each new money Lego is a freely available public good for any Builder to use creating an opportunity for each net new builder in the space to stand on the shoulders of giants it's what creates the conditions that allow for the creation of exponentially more unique combinations of mechanisms over time moving beyond one-to-one coin voting is an opportunity to create more cartel resistant forms of governance there are inequalities and incentive misalignments even in the absence of attackers these systems can be dominated by the rich and

powerful and outright attacks through various forms of often obfuscated vote buying in one-to-one coin voting systems closing the gap between value creation and value capture remains a huge opportunity for funding public goods the more people can worry about value creation unless they worry about value capture from the business models the more they are focusing on the public good mechanisms that measure value creation and reward participants for that value creation are possible with more objective or inter-subjective

measurement of value creation unsolved problems and opportunities continued decentralized reputation systems because so much value transfer in the world depends on the reputation of the parties in the transaction it could be argued that identity is an important part of the internet of value when I get a job I want to know who I'm working with when I loan someone money I want to know their history of repayments when I invest in a company I want to know the founders reputation to understand their character

when I get into an Uber I want to know that my driver's reputation is free of major accidents when I log into my social feed I want to know the credibility of the content authors I see proof of personhood what if we could find a crypto economic way to prove unique humanness we could move the internet of Finance from one token one vote to one human one vote and unleash a wave of digital democracy with proof of personhood the ecosystem could move to Dows built on one human one vote this unlocks use cases like number one

quadratic funding number two one person one vote or quadratic voting doubts number three Genie coefficient measurements number four Universal basic income and other use cases we haven't discovered yet unsolved problems and opportunities continued privacy privacy privacy to prevent many dystopian outcomes privacy must be baked into these mechanisms from the start the old world model of privacy is broken the new world privacy model will be built around zero knowledge proofs for

example you will be able to prove attributes about yourself without revealing any more personal information about yourselves persistent pseudo-anonymous identities will be a thing people will need practical ways to let people build deep long-standing reputations without practically doxing their real world identities organically eth addresses with long complex history of transactions nfts and ens are nice but it's time frame frequency and diversity are hard to fake or duplicate other unsolved problems may exist

especially in systems with high wealth inequality high levels of plutocracy or collusion high energy inefficiency in some networks High misinformation and tribalism or dependence on web 2 social media High extractive economics lack of Education lack of access and lack of diversity unsolved problems and opportunities continued impact Dow ratings Dao impact dowels are the atomic unit of the regenerative crypto economics movement the positive externalities produced by each impact

Dao when stacked upon each other will hopefully create an entire regenerative crypto economic stack but how are we to know which impact Dows are truly having impact and which are just marketing don't trust verify is a mantra among cryptographers how can we apply this to the growing field of impact dows having an impact Dow ratings down which catalog the positive and negative externalities of each impact Dow would be an important piece of infrastructure provided that it is governed in a transparent and credibly neutral way to gain the legitimacy needed to be seen as

impartial starting small with a healthy culture it would be possible to over emphasize the creation of an academically perfect system and in doing so forget about the cultural and mimetic needs of a community starting with small PODS of culture that are themselves healthy is a must as a Founder your actions inform the actions of the first five people in your project those five inform the next 20 which informs the next 100 and so on Peter Pan the founder of metacartel one of the most prominent and first Dows in

webstery is a shining example of this he formed metacartel as a series of pots with their own individual culture Vibes and Mission meta cartel is not a single monolithic group each pod had its own mission goals and focus and tightly curated culture they each started small and only grew when they were ready once they grew they retroactively gave governance rights based upon the values they had set early meta patterns here are a few meta patterns you will find across different regenerative

crypto economic systems pluralism skin to biodiversity the more pluralism there is across an ecosystem this creates more anti-fragility as it grows expressivity the collection of Primitives available should reach enough to allow actors to express organizations we've not thought of yet simplicity legibility individual Primitives should be relatively simple you can combine them into more complex assemplages standardization a sufficiently large library of legible Primitives that you can almost always find a known simple

legible component that meets your needs and will accelerate innovation modularity composability this comes pretty naturally from Simplicity and standardization and assuming your collection of Primitives is sufficiently expressive you can create assemblages that do just about anything symmetry between value creation and value capture when the value creation of a system is disconnected from the value capture there will be an inherent misalignment between the incentives of actors in the system to focus on the

capture value instead of the creation of it therefore regenerative cryptoeconomic systems aim for symmetry between value creation and value capture robust signal emission an alternative to governance via voting which has historically had issues with plutocracy and low voter turnout is robust signal emission the measurement of value creation via robust signal creation is a powerful way to allocate funds to an ecosystem of participants at scale by measuring what communities of participants within an ecosystem value

and inter-subjective consensus of the value creation from that ecosystem is created this inter-subjective consensus can form the basis of a distribution of retroactive tokenized rewards robust signal generation of course in order to create a robust set of signals one needs to have an active ecosystem of participants to that end there are a number of Engagement hacking techniques that were pioneered in the web two days which also work in the web 3 space while they are not regenerative in nature themselves they

can be assembled into regenerative crypto economic systems wherein their data emissions can be analyzed for regenerative purposes and we include them on this basis user engagement feedback loop the feedback loop can work as such content on a platform such as Facebook or Twitter is a trigger to a user the user takes an action to scroll creating an opening for a reward perhaps interesting objects the feedback loop then completes as the user invests back into the loop by re-pinning following

commenting Etc widely articulated by Pinterest this articulation of a feedback loop of user engagement is designed to keep users engaged by triggering their interest to perform some action for when they are given a reward and are prompted to make further investment of time or other resources balancing challenge plus skill for a graphic on this section check the screen when onboarding users into a system crypto economic or otherwise be careful to balance between Challenge and skill too far to one side and the user gets

bored too far to another and they get frustrated reward types as users become more immersed in systems crypto economic or otherwise different types of rewards can be deployed at different times in the funnel [Music] chapter 6 looking forward civilizational scale regenerative crypto economics an anonymous quote as Humanity transitions from the Industrial Age to the information age our old institutions are decaying in

this Overton window we have a once in a lifetime opportunity to build new better fairer institutions what is an impact Dow a Dao is a decentralized autonomous organization some Dows are like global companies some are protocols all of them use blockchains as a trust anchor an impact Dao is any Dow that creates positive externalities for the ecosystem in which it resides impact Dows are the scalable building block of a more regenerative economic infrastructure examples of impact Dows for a graphic on

this section check the screen Claris positive externality dispute resolution circles Ubi positive externality Ubi for members proof of humanity positive externality civil resistance climadow positive externality positive price pressure on carbon credits get coin Dow positive externality funding for public goods one powerful attribute of clusters of impact Dallas is how the positive externalities flow between them for example Sybil resistance flows from

proof of humanity into git coin Dow which in turn has funded projects in the proof of humanity ecosystem including climadow two ingredients for an impact Dow mechanism and funding source impact Dows can vary in mechanism and funding source for a graphic on this section check the screen the diversity and the mechanisms and funding sources for impact Dows creates a pluralism and anti-fragility in the way public goods are funded the big idea number one build a parallel opt-in

system for funding digital native public goods which operates at a greater efficiency at a greater scale number two this parallel opt-in system could increasingly support non-digital public goods number three as more people quit their private jobs to work on public good energy and one public good seeps into another a sense of 21st century native civic pride emerges momentum compounds outwards in a virtuous cycle of growth number four more Global public goods get funded over decades economies and democracies all over the world get

upgraded to be higher bandwidth for the digital age creating more human thriving impact Dallas can stack each impact Dow benefits from all the Stacked impact dials supporting their work each impact Dow benefits When public goods below them in the stack are funded scalability impact Dow stacking is how growth compounds momentum builds and regenerative crypto economics eventually becomes inevitable pluralism because each impact Dao can have a differ mechanism or funding source this leads to a more pluralistic public goods funding infrastructure

foreign [Music] chapter 7 get involved an anonymous quote all coordination is a choice we have to choose the future we want in the day-to-day choices we make not only in the types of assets we buy but also in where we put our scarce time attention and skills contribute to the next edition of this book if you would like to join the community of writers and Educators forming around this book please scan the QR code on the screen or go to the URL

in the description take the green pill yourself pledge to support public goods at greenpill.party or check the URL in the description join the fight against moloch join get coin Dao learn more about what the Dow has been up to at getcoindao.com join the funders League thank you to the following organizations and people who have made the work that gitcoin Dao has done possible with their generous Financial contributions ethereum Foundation ens optimism

nounsdao chain link synthetics moments.eth balancer Badger uniswap polygon Kraken yearn Vita Dao greatest LARP Aragon moonshot Bots binance epns CMS Holdings steak fish Defiance capital and three arrows Capital mask 0x default region Network rainbow rolls climadow fire eyes future fund Harvest Finance ocelot Sushi Stefan George yam Finance

Mariano Conti Dora hacks Robert leschner Andrew Keys 1kx bantake Aztec Robert leschner integral Finance learn more about how you can financially support public goods on gitcoin by going to the URL in the description it's all coordination it you Anon and in Coit virtuous cycle all coordination is a choice to win this coordination game we need to choose to coordinate to make this into a

multiplayer game once the multiplayer game is bootstrapped we need to choose coordination to win it once we win it we must coordinate to maintain its legitimacy we do these things not for their own sake but as a means to create human thriving if we collectively all take the green pill we created more solar Punk world if we collectively do not we continue to maintain the status quo regenerative crypto economics is here it's important and it's happening but it is also in Coit to grow it needs you the Overton window is open join the

movement do what your skills and abilities uniquely enable you to do spread the word build something learn from your mistakes and throw it out and build something else host a meet up be honest about where we're winning and also where we fall short do what feels right to you do your own research beware any charismatic leader who claims to have all the answers including me the leader is the person who knows what to do next and whatever you do remember to coordinate written by Kevin owaki on Twitter at

owaki we are all going to make it wag me the end