ep 2 – Blockchains / Crypto / web3

Transcript

[Music] welcome to web 3 with a6 and z a show about building the next generation of the internet from the team at a6 and z crypto that includes me your host donald trucksey this show is for understanding and going deeper on all things krypton web3 including through offering occasional data readouts and insights directly from the leading scientists and makers in the space so we'll be diving deep the rest of the season into various topics ranging from auction design and mechanics nft security to economics zero knowledge gaming decentralized media infrastructure roadmaps and much much much more but in this second episode we set some more context quickly into the connection

between blockchains crypto and web3 and offers some useful analogies and more mental models for thinking about a blossoming area of computer science in both theory and practice our guests today include chris dixon founding general and managing partner at asics and c crypto aliyah general partner and former software engineer and researcher at google x and google brain ai and core developer on tensorflow and tim rufgarden head of research at asics and z in the computer science department at columbia university who previously spent 15 years in the computer science faculty at stanford and moore we'll go deeper with him in the next episodes just a reminder that none of the following should be taken as investment advice please see asics.com disclosures for

more important information we start out by talking about the key foundations of blockchain crypto and web3 where analogies to the internet and more do and don't apply and areas of interest the first voice you'll hear is chris's followed by ali's and then tim's via mobile great so let's just talk about what a blockchain is because there's a lot of confusion around that one of the sources of confusion is people will sometimes explain blockchains as ledgers but the way i think about the ledger is maybe half of what a blockchain is right the ledger refers to the storage the fact that a blockchain can store things and do so in a way that is trusted and will be maintained correctly but most of the programmable blockchains like ethereum

also have compute you can write code for them and that code can change the state and so very much like a computer that has a cpu and a hard drive a blockchain has both the ability to do computing and to store information so that's the key source of confusion number one the second source of confusion is why would you want like what's new about a blockchain and if you look at it you know maybe an engineer at google who has spent his or her career trying to squeeze more performance out of distributed systems they look at a blockchain and they say wow this thing is sort of a step backwards because it's slower now what they're kind of overlooking is blockchains have a new property that traditional computers don't have i like to say blockchains are computers that can make commitments they are computers that you can write code

that will continue to run autonomously as designed in perpetuity and that lets you do things like you know the most obvious case is do things like create digital currency like bitcoin so a bitcoin to the extent it has value that value is dependent on a bunch of kind of promises that bitcoin makes including for example bitcoin promises there will only ever be 21 million bitcoins now on a traditional computer architecture if google said i'm going to create google coin and there's only 21 million google coins that code is just running on a server google somewhere which ultimately management google controls and they can just change that number 21 to 22 or 23 or whatever they want to change it to because ultimately traditional computers the software is subordinate to the hardware which in turn is supporting it

to humans and so ultimately they're just sort of extensions of the human will there whereas in a blockchain you invert that relationship between software and hardware and the software governs the hardware so you know one of the key properties of the well-designed blockchain is that even if a significant number of people running the hardware the miners or validators decide to subvert the system or do something else that undermine it change the number of bitcoins etc they can't do it unless there's a sufficient number and the game theory incentives are designed in such a way that at least in all the kind of mainstream block chances never happened and it's very difficult to make happen so i'm always kind of working on simpler ways to explain this but yep i think anyone who builds smart contracts and blockchain applications intuitively understands this the key property in my

mind is that the code is autonomous it continues to run as designed but the software governs the hardware and therefore this opens up the new design space finance is one obvious new class of applications a really interesting area that we're spending time on now are blockchain-based social networks where the social networks can make strong commitments around the governance around the economics a developer building on a blockchain-based social network knows that the rules won't change the way they change with facebook twitter there's a whole bunch of it but basically this new kind of computer architecture where the software controls the hardware on the blockchain unlocks a whole new design space and various kinds of new classes of applications i think chris nailed the definition of what a blockchain is and how we think about blockchains namely that they are essentially computers as opposed to anything else like databases

ledgers or whatever else people use to describe what a blockchain is the one thing that i would add is where does the term decentralization come in why does the centralization matter why do people talk about decentralization and how does it relate to what a blockchain is so the way that blockchains provide the guarantees that chris was talking about is that they are effectively decentralized they are under the control of a very large number of independent actors that are representative of the community that collectively owns and controls the blockchain so this angle of community ownership is another important aspect of what a blockchain is because bloggers actually can't change the commitments that they make to people and sometimes they do do they have to because they may have bugs they may have

to upgrade themselves they may have to evolve and the key here is that they do that in a way that's neutral in a way that's controlled by a body of people that's representative of the broader community and that's where decentralization community ownership comes in it's an important angle to also highlight it'll sound a bit like variations on the theme but you know the way i've often been describing the essential functionality that blockchains offer like what's the computational superpower you get from them that didn't already have from previous technologies i like to use the metaphor of a computer that sort of lives in the sky and operates in public view as a public good now computers are everywhere obviously so just being a virtual computer that looks in the sky you know there better be more to the story because we already have computers and moreover current

blockchain technology viewed as the computer in this way is pretty primitive computer it is powerful as computers from the 1970s or something one thing we're going to see happening over the next several years there's tons of projects really working hard on this is the scalability problem which will make the computer in the sky more like a 1990s or even more modern computer than ones from the 1970s but even already with the current technology it's clear we have functionality that we did not have before from a computing perspective the computer in the sky is very unusual and that it in effect has no owner no operator it's very much what ali was talking about really the computer was virtual it's the product of ideally thousands of physical nodes cooperated through a consensus protocol to simulate the behavior of some virtual machine right moreover it's open access so

anybody can use this computer in the sky i mean there might be a usage fee especially if there's a lot of congestion but you don't have to be on any white list you don't need anyone's permission and by use i mean interacting with quote unquote already installed software the existing smart contracts that have been deployed or you're also free to install new software of your own that would be like deploying a new smart contract mm-hmm and the final aspect which i maybe find the most remarkable of this computer in the sky is especially once you incorporate sort of the magic of cryptography despite seemingly having no owner the computer actually enables a new notion of ownership for its users so if you're an end user of a smart contract platform like let's say ethereum you can really own in a meaningful sense digital data that lives on that computer and that

computer will enforce property rights on your behalf and when i say this i mean property rights in the totally traditional sense of the work like right to use right to exclude right to transfer and it's this sort of paradoxical combination sort of a computer that on the one hand in effect has no owner but on the other hand enables ownership in a way we did not previously have for digital data that to me is really kind of the unbelievable breakthrough with the bitcoin protocol now nakamoto had in mind the specific use case of a cryptocurrency so for nakamoto's digital data was going to be bitcoins but the technology fundamentally is not about currency per se it's really just about being able to enforce property rights without a central authority on digital data that was great i'm a big believer in

analogies for helping not just illuminating something generally but especially when they can help illustrate specific properties so that was great tim yeah i really like that breakdown since the point of this episode is to sort of ground what is before we go deeper in the remaining episodes let's now connect the dots between blockchains crypto and web3 so just to kind of zoom out a little bit i think of those crypto and web3 to me are not technologies they're movements they're movements that if you sort of imagine a venn diagram they overlap they're both based on blockchains both use blockchains and then all the different things that come out of blockchains like tokens but to me first of all crypto is kind of an older term and here by the way i mean crypto not in a cryptography sense but in the cryptocurrency sense and crypto is to me

much more about kind of money bitcoin finance payments and that was sort of the original movement that came out satoshi and then there was this kind of fork of the movement maybe five years ago which we call web 3 which is taking the same technology but orienting it more toward building internet services that are owned and operated by communities so sort of the next gen social networks next gen content monetization next-gen marketplaces and all the kinds of things that we've seen built on the web of last 30 years but now with the new architecture where those networks are owned and operated by communities of users instead of by companies and so yeah this probably better described kind of visually but i think of it as there's this tech stack and then everything that goes into a blockchain and you know modern

blockchains are quite complex and there's different layers in the stack but then there's these other kind of tech constructs that come from a blockchain enabled by blockchain the most notable one being tokens whether they're fungible or non-fungible so sort of this tech stack and then separately there's these movements that use this technology in different ways and this is what can sometimes be confusing to people because there's all these kind of words thrown around but that's my basic mental model for how to think about this a good way to think about this as well is to compare it to the original internet tech stack where there's actually a distinction between what people know as the internet and what people know as the web these days often people just think about it's interchangeable but the actual separation between them is that the internet is the core of the technology

and the protocols that enable the transfer of information from point a to point b it's very raw it's very low level it's things like the ip protocol and tcp it thinks at that level and then the web is a set of technologies that's built on top and as you were saying chris it's a movement that actually makes the internet into a platform on top of which you could build real applications and technologically that includes things like html javascript and css but it's also a whole set of best practices it's a whole set of how to build applications that are internet enabled that includes everything from things like social networks things like the mobile web everything that we know and love from the web that has emerged in the past couple of decades and i think similarly my breakdown between crypto and web 3. for me crypto is the

infrastructure is the low level protocols that make all of this work it includes things like warp blockchains and it also includes maybe the raw initial killer application which was just a form of money in the same way that the internet includes the raw killer application which was female like smtp is an internet protocol not a web protocol and cryptocurrency is very much a crypto protocol and it's not quite web3 web3 is what actually makes crypto into a platform and it includes programming languages like solidity it includes the frameworks that people use to build apps that include things like web3.js there's this whole kind of ecosystem and set of best practices that has made crypto into a far broader technological movement so elite gave some very nice analogies with how things are perceived in the

internet for me that's been just an endless source of helpful comparison points and obviously extremely hard to predict exactly how the moon's going to play out but i look back to the evolution of the internet for clues and one of the things that i think we'll see is the co-evolution of advances in infrastructure and in the applications so you have this tech stack on the bottom part of the tech stack is the actual plumbing like the system and how it works on the internet you'd have things like bgp routing protocol or ip and then there's the stuff which is built on top right so you have the plumbing which enables some functionality for the internet that would be the transfer of digital data between any two points on the globe for blockchain that would be this computer in the sky with no owner and remarkable

capabilities and so the infrastructure question let's sort of implement this functionality in the most powerful way possible for the internet obviously going from dial up to broadband was a huge advance the quality of the infrastructure very much expecting to see huge advances in the power of the computer in the sky in the web 3 world obviously every advancement in infrastructure enables new applications it's just a far bigger playground application developers have to work with but then also conversely you know as we make advances in understanding what are going to be the really game-changing applications that then feeds back into and motivates investment in certain improvements in the infrastructure so i think we're going to see that back and forth happen many times over the 2020s just to add to it and said the way i think about it is if you look at the 1990s 1980s you go watch a movie from

that era you look around the world the world doesn't look that different in a lot of ways you know cars have gotten a little bit better washing machines are mostly the same the average house has not changed that much in 30 years the way that let's say it changed between 1910 and 1940 or something i think it's of course changed dramatically or computers right i mean not to explain it but like the fact that we all have magical smartphones in our pockets is an amazing thing right so one question is why do computers seem to get better at an exponential rate when everything else gets better at best at a linear rate and sometimes you hear the answer is moore's law moore's law is of course this idea that you can pack more transistors on the semiconductors every couple of years i think moore's law actually is just one

of many things and the really important thing is a bigger idea which is what tim was talking about which is computing movements sort of have two layers there's the infrastructure and the applications yeah and when they get going because they usually have some sort of this kind of incubation phase when they're sort of tinkers or starting to make them but once they sort of start to hit mainstream you get this really important economic flywheel and that flywheel is the applications get better which make the computers more useful which in turn sell more computers or make the infrastructure more popular which then gives investment to the infrastructure the infrastructure gets better the applications get better so you take an iphone today and you compare it to an iphone 2008 the iphone itself is dramatically better the camera the processor but the apps are night and day

much better and if you go and look through time there was this period especially around let's talk about 2009 to 12 or so when those things really got going that engine got humming the apps got better apple got more money samsung got more money built better cameras built better chips that then let the application developer say oh wait this thing's faster now what can i do with it the camera's better what can i do with it instagram took off the day the iphone 4 came out iphone 4 was the first iphone that had an hd camera right but that took apple five years of investment to get to that point where the camera was so good that that enabled instagram to really take off so one of the really exciting things now the web 3 blockchain movement is that i think we're hitting one of those kind of flywheel moments

where the blockchains are getting much better the applications are getting much better and they're reinforcing and that's why you're starting to get kind of an exponential effect you know there's an old saying in technology that is surprising how little changes in two years and how much changes in five years which is sort of alluding to the fact that these are typically non-linear kind of exponential processes yeah and you've said in the past that it feels as if crypto is beginning to graduate from its infrastructure phase because for the longest time starting around 2014 when this idea that a blockchain could be a computer emerge for the launch of ethereum up until really like say 2019 or so it really was just building infrastructure in a vacuum with only a theoretical sense for what the applications that you could build on top of blockchains would really be and in

the past three years or so people starting to build applications that actually have a meaningful user base that begin to stress the infrastructure and begin to inform what the infrastructure should provide to actually make those applications work better and so this is what i think has sticked out this flywheel that chris and tim are talking about that really results in this exponential improvement to the computational infrastructure therefore to the kinds of applications that people could build those are actually some great mental models continuing this theme of mental models but you know where internet history is certainly useful and i too am obviously a student of that computing history i actually think sometimes we overuse the analogy so like where does that analogy not apply here when it comes to this modern sense of crypto and of blockchains and web3 yeah i think there

are two things that make crypto a little bit different from previous computational paradigms and also different from the internet and those two things are one that crypto and web 3 are really primarily a software movement in that everything that needs to happen in order for all this to work is really just innovation at the software level people have to come up with better algorithms they have to come up with better standards it's all just code that people need to write for all of this to work and that's in contrast with say mobile or with personal computing where you actually have to build a hardware device or also compare this to the internet people had to actually lay down fabric like the cables to connect the world to actually make the internet work and those things just tend to move more slowly because you have to interact with

atoms as opposed to just bits so that's one the second piece is that unlike previous technological movements crypto and web 3 has this very strong ethos of building out in the open where open source is a very core piece of the philosophy of the movement and so as a result most of the ideas in this space end up being out in the open end up being public much more quickly than they tend to be in any other area of technology and that results for this kind of combinatorial possibility of ideas where ideas can connect with other ideas people can collaborate across organizational boundaries and it's a much more experimental environment that allows for innovation to happen more quickly so those things combine we do this kind of exponential improvement in the infrastructure and the applications

that are possible that definitely feels like it's much faster than most other areas of technology so yeah those are like differences of degree versus kind i mean obviously crypto and blockchain spend it frame for hardware in other ways but not in sort of the roadblock ways you pointed out and similarly open source has obviously been around for a while we actually talked about this in the first other episode so what are the other big differences in your view of kind maybe yes there are two other big differences one of them is the fact that crypto builds in incentives into the infrastructure where now we can have protocols that incentivize participants that allow for people who have computational power to bring that computational power to the network and contribute it to the computational infrastructure and then get rewarded for

that whereas previously protocol before like the ip protocol or tcp where they were just ultimately schemas like ways by which you can arrange bits on a wire that the other end would also sort of accept as a way of being able to interpret those bits without really kind of an incentive structure for how it all works so those incentives have to be external to the system whereas now that can be internalized there's this notion of money this notion of ownership that's built in into the infrastructure and then the other one is that because of the fact that these things are fully programmable they can build into themselves mechanisms for governance people can use the infrastructure itself to propose ways by which the infrastructure should change so for example if you wanted to upgrade the code for any one of these blockchains

there are multiple different models for how government should happen but in some cases that can happen in a way that's formally built into the system and that allows for the evolution of these systems in a way that tcp and ip and protocols like using the internet have not really been able to evolve those are mostly static requests that don't really change over time at all whereas crypto blockchains and web3 opened the door for evolution in a way that's still credibly neutral and it brings the input from the entire community one sort of a remarkable byproduct is we're now basically seeing in real time all of these different experiments around governance which in the traditional world you'd have to look back over centuries to see experiments with so many different type of governance systems so you have some blockchain protocols and communities around them

that are very aggressive with upgrading the protocol others which are very conservative others which even incorporate just sort of an on chain so purely programmable method for upgrading so it's really fun to watch all of these competing approaches around governance to see over the years which one turns out to be the most effective which is funny because when you think about the history of the internet a lot of it was a standards top-down versus bottom-up kind of approach to kind of finding standards and it's really fascinating because we're talking about interoperability here that's emergent not like decided and ordained by all these different players well yeah i mean i think one other thing to point out is that there really are two very different analogies that i think we and a lot of people like to use to talk about crypto and web3 and one of them is the

comparison to the internet the other one is the comparison to just computing platforms from before including personal computers and including mobile and those two are very different comparisons and what's fascinating about crypto and three is that i think it's actually both like crypto and web 3 the systems in this world are both protocols like those of the internet but they're also computers like mobile phones and personal computers and so what's interesting about that is that it will lead to very new dynamics that really cannot just be predicted by looking at the internet and by looking at personal computers and mobile phones and i think one example of how it's actually hard to predict how all of this unfolds to your point journal about standards one way in which the internet and personal computers and mobile phones are very different is that the internet was very

much built around standards and it's very much modular in that you have each layer of the stack very clearly and distinctly defined from each other layer and it's not vertically integrated whereas in the world of computing some of the most successful approaches are very much vertically integrated something like the mobile phone from apple like an iphone to deeply vertically integrated tech stack but also computing infrastructure like often building a developer platform really benefits from having some amount of vertical integration because you can make the developer experience much better you can make the user experience much better if you control more of the stack so both of those forces will likely play a role and so it's interesting to compare to both of those two different examples from the past to try to learn something about how we

might evolve and standards will certainly be a big part of that so on the whole thing of the exponential it's interesting because you guys talked about how there's an exponential effect all of you kind of use some word a variation of that and you did allude to this earlier ali when you said that there are two things that contribute to this kind of exponential process with crypto and blockchains and web3 and you mentioned chris earlier like moore's law as a force and we often talk about it as a force of human ingenuity it's not like an actual law of physics obviously but is there an equivalent moore's law like thing underlying crypto and the infrastructure and the growth that we're seeing or a specific principle or if it's not actually a moore's law then the other way to answer this are what are the accelerators that you see and i

don't mean just generically like oh the conflation of talent and activity which is amazing and important but like technologically what are some of the accelerators that you guys hear a very important thing that as ali was talking about earlier almost everything crypto is open source yeah totally and for those who haven't heard yet the first episode we recorded actually goes into that story of the evolution of open source and you know how it is the story of technology but anyway i mean like something like 99 percent of the software running in the world is open source today you know the vast majority of the software on your phone on your computer basically everything how did that happen right if you don't have a theory of how that happened you don't really understand software and technology i believe and i will tell you my theory how it happened composability

which is that open source software you write a piece of code on github and that then becomes not just a piece of code but a lego brick that somebody else can come along and take that lego brick and put it together with other lego bricks and build something new so with open source software humanity only has to build each piece of software once and then other people get to reuse it and more importantly it's not only the software becomes composable but the services become composable so you take this open source software and you instantiate it you run it and that running code can then also be a lego brick and so it really extends this very powerful composability kind of concept and open source software and moves it beyond static dead software code to instantiated code ie services there's a

whole other story i won't go into now but basically what you had happen as open source eight software the software industry pivoted over the last 20 years moved out of the software business because that was no longer a good business and moved up the stack quote unquote to services right so if you're looking to software as a service this is the buzzword why are proprietary companies building proprietary software focused on services software isn't good business anymore because it's all free on github so they kind of moved up the stack and look if you look at these services like aws i mean it's basically they just go and vacuum up all this open source software and then run it kind of parasitic on the real innovation which is the open source software community mm-hmm anyways so that's one of the ways to look at blockchains that lets you now

instantiate that open source software and it lets the kind of the forces of open and free and from the open source movement now move also move up the stack the way the proprietary world did into services right it's a whole longer story but so your question about exponential processing i think one answer is composable software at the application layer you're also seeing real progress at the kind of pure blockchain level including the consensus layer and i'll let ali and tim talk about that right so talking about the consensus layer there's actually a really interesting backstory on consensus in general because it's actually a classic topic in academic and practical computer science so lots of amount of work back in the 1980s a couple turing awards you can give it out you might say wait a minute 1980s like you know consensus

like blockchains weren't even a gleam in anyone's eye back then and the applications were very different you know they were thinking about like some big company like ibm has a database and they want to replicate it so they get very high up time but as soon as you have like a bunch of replicas you've got to keep them in sync so i guess you need to consensus protocol and so amazingly a testament to the power of like getting your abstractions right academic work in general it turns out a huge number of the concepts and vocabulary that was developed by computer science researchers back then in the 80s is actually like a perfect fit to the needs of consensus also in a blockchain setting it does help with uptime but the goal more is the decentralization the ownerlessness property that we've talked about previously that's really why

you're doing consensus among lots of different nodes in a blockchain context now that said the work from the 20th century can't be applied immediately off the shelf right so back when you're thinking about ibm just buying seven machines you know exactly which nodes are running your protocol and you can build that into the protocol and people did in the 20th century whereas the very open vision for public blockchains is really anybody should be able to run that's part of the power that's part of the promise really of the owner-less property that just sort of all kinds of people without permission all over the globe should be able to contribute to running the protocol so that means we have needed advances on the consensus layer first even just to go from off to on that's what nakamoto did for us with bitcoin it was really the first permissionless consensus

protocol that didn't care at all which were the nodes they were running the protocol it's kind of amazing you can even do that really in principle but since bitcoin there's been many dances in consensus protocols in a blockchain context and so part of the problems that have had to be solved have been like approaches to simple resistance to the fact that you don't know if someone's a dog on the internet you don't know if a billion different public keys all belong to the same person and really represent a million different entities so you need sort of specific advances and proof of work or proof of stake these should be examples of ways of handling silver resistance so the basically nodes can't influence the amount of power they have over the protocol without some significant economic costs there's been a lot more understanding about how to harness the advances from

the 1980s so disney felt tolerant consensus and had more and more powerful versions of that in a permissionless context in effect using something like a proof-of-stake slipper resistance as an outer wrapper to sort of reduce the 21st century problem back to the 20th century problem and that's where right now we're seeing projects that are in production there are major blockchain protocols which are harnessed by teen fall tall and consensus to get much higher throughput you know with higher transactions per second and then there's also projects that are under development which will take us to yet another level so i think we're just seeing rapid advances i mean this really defines the computational power of computer in the sky so it's obvious to everybody that this is sort of crucial for blockchains to realize their full potential

and now we've had some of the best my computer science are really focusing single-handedly on optimizing consensus for the blockchain use context yeah absolutely a big part of the conversation is focused on the scalability problem more recently as some of these applications have started to get actual real user demand it's become clear that we need to improve the underlying infrastructure to be able to rise to the challenge and be able to support a higher level of throughput lower latency lower cost per transaction and i'd like to remember one of the key lessons from distributed systems or just systems in general actually like like the work that's been done in the past from the 20th century this thing was talking about just a scale system like what are the like age old tried and true

techniques that people use to scale systems and it's often really the case there are just two ways at which you scale the system one of them is you use parallelism and another one is you use hierarchy and it's interesting to see that all of the work that's been done recently in the past say three to four years in the crypto and web3 space have very much followed that as well like if you look at all of the major approaches that people are trying in order to scale blockchains they either fall in the camp of trying to paralyze the work that all of the nodes in a blockchain network have to do or try to introduce hierarchy as a way of also gaining such scalability for example there's this whole conversation around layer twos where you're trying to basically build a specialized network that inherits the

security of the main layer one network but is able to do something more efficiently by having say more powerful machines we're having new techniques that allow for the processing of more transactions or for the processing of those transactions more quickly but then also be able to just go back to the layer one in the case that like you need the additional security from the layer one you can always fall back to it so one analogy that many people have used is to think of the layer one as a kind of supreme court where the layer two is sort of a local court that deals with local issues and only when something needs to be escalated to the supreme court do you actually do that so this way you end up with scalability by introducing hierarchy and having so more specialized networks that do high performance work and essentially spare

the one from doing itself and then in the case of parallelism sharding is this approach that a lot of people are trying to build which is to try to split up the work that many different nodes have to do in the network across lingo so instead of having every node process every transaction you can have some transactions be brought by some nodes and other transactions processed by other nodes so that's kind of like the idea of horizontal scalability it is an example of parallelism as a way of scaling blockchains can you be a little bit more specific ali about the different challenges at the infrastructure level really quickly and share some examples of the areas that are addressing them we'll dive into the apps layer and other important developments in later episodes okay so as i mentioned one of the big challenges is killability is getting blockchains to

be able to perform more transactions per second to be able to perform those transactions more quickly so you have finality more quickly and to also be able to reduce the cost that people have to pay for each of those transactions that's the cost for transaction gas people have to pay that's an often cited problem with blockchains today a different problem is the problem of the developer experience how do you build applications on top of blockchains that have all of the features that you want them to have but that are also secure and we've seen many examples of how it's possible to get it wrong and have bugs in smart contracts and programs that run on blockchains that lead to a lot of money being lost and there's a lot of work that's being done to improve the tools and to improve the programming

languages that people use to express programs in the space that make it more easy for developers to reason about the correctness of those programs so that's a whole other area of work that's very important and i think it's more qualitative it has to be more with the experience of the developer and with the tool chain that people build to make these things easier a third area of work is also on the user interface so the user experience like what are the best practices the tools that people use to interact with applications in the space and this includes things like the wallet like what does the wallet do to inform you of the kinds of things that you're doing when interacting with applications in the space and then there's like a whole other set of challenges including things like privacy interoperability

between different blockchains there's a lot of work that's being done to build bridges to connect different blockchains together and all these things are coming together to build this like fabric or decentralized computation on top of which you can build very rich applications and as these challenges get addressed the applications that can be built will be increasingly more powerful and i'll just add a little bit about challenges from the perspective of the research education side i mean one thing that i think is really important for web 3 to really achieve its full potential is just a proper rigorous understanding of the design space and the various trade-offs that are involved so to give an analogy the earliest computers are from the 1940s so basically the beginning people would program just directly so in what we now call assembly language that the

processor would interpret directly but it was very obvious to everybody very quickly that there was going to be higher level languages that then are automatically translated into the lower level language that actually gets processed there was clearly going to be a need for compilers from higher level languages to lower level ones and so the compiler design is something people really were working hard on in the 50s without a lot of guidance about how to think about it it was a hard problem plus there was sort of a lack of clarity about how to go about it and over time we saw so the power design specifically the progress has encapsulated my mind by this famous textbook called the dragon book by ajo sethi and allman basically it took this previous super super messy problem that everyone was having trouble thinking about and said you know look it's just

still like a really complex problem but here are the five different things that you need to get right and for each of those five things here's sort of a menu of options the different ways you go about doing it here are sort of the trade-offs the pros and cons of each of those approaches to that particular piece of your compiler so understand the needs of your particular sort of application and then that should inform how you make these various trade-offs so unless the research is less educated in me my dream is to have this exact same kind of playbook design of blockchain protocols and other protocols in web 3. where we really just have the language and the sort of mental clarity around what are the important design pieces what are the options and what are the trade-offs between the various options and we've certainly there's been some

pretty rapid progress along these lines over the last few years but there's clearly another at least 10 if not 20 years of work to really map out the space and i'm excited just to watch that happen yeah i mean i think the things to look for will be exciting i mean some of the things we discuss like just the improvements of the technology kind of infrastructure layer extending existing classes of apps we'll see more build out in those classes but the other to me kind of most fascinating part will be new classes emerging my experience and i think history suggests that once you create this kind of canvas of a computing platform that developers surprise you and that having millions of smart people around the world kind of run experiments and try things leads to all sorts of really interesting things

so that's for me what makes this period so exciting i mean that technology is a means to the end and ultimately the end is unlocking human creativity and i believe we're in that peak creative moment of this movement the next couple of years and that should be really fun to watch fantastic note to end on i almost feel like we have nothing more to add there because that was a great note to end on okay well thank you so much for joining you guys thanks again everyone thanks general thanks everyone thank you guys and that's our second episode of web 3 with a6 and z don't worry we sort out the sound in the next episodes you can find show notes with links to resources books or any papers mentioned or discussed transcripts and more at asicsncrypto.com this episode was produced and edited by

sonal choxie that's me the episode was technically edited by our audio editor justin golden with thanks to longtime sound engineer seven morris credit also to moonshot design for the art and special acknowledgements to chris dickson founding and managing partner cmo kim milosevic and several others on our team here for their support to follow more of our work and get updates resources from us and from others be sure to subscribe to our web3 weekly newsletter you can find it on our website at asicscrypto.com thank you for listening