Tally: The Software Layer for Tokenized Organizations - Dennison Bertram. Ep. 594

Transcript

I have felt that there's a lot of sort of like inequality in the sort of standard corporate system and how corporations work and how you know borders prevent you know sort of human capital from crossing them. I really thought that we could basically incorporate organizations on the internet rather than in legal jurisdictions and that we could use software to incorporate them. And this software could define the relationships and mechanisms by which organizations came to consensus. If you create an organization in software, it can actually scale to billions of people, billions of dollars, and it might exist for 15 minutes. something that's not possible in the traditional world and it

brings incredible amounts of scale to creating organizations. Welcome to Epicenter, the show which talks about the technologies, projects and people driving decentralization and the blockchain revolution. I am Fedria Ans and I'm speaking with Dennis Bertram today who is the CEO and co-founder of Tally which is a decentralized governance platform. But be before we get into all of that um these are our sponsors this week. If you're looking to stake your crypto with confidence, look no further than Chorus 1. More than 150,000 delegators, including institutions like Bit Go, Panta Capital, and Ledger, trust Chorus One with their assets. They support over 50 blockchains and are leaders in governance or networks like Cosmos,

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project, Nosis Chain offers the same development environment as Ethereum with lower transaction fees. It's supported by over 200,000 validators, making Nosis chain a reliable and credibly neutral foundation for your applications. Nosis DAO drives Nosis governance where every voice matters. Join the Nosis community in the Nosis DAO forum today. Deploy on the EVM compatible Nosis chain or secure the network with just one GNO and affordable hardware. Start your decentralization journey today at nosis.io. IO. Cool. Dennison, it's super nice uh to have you on the show.

Excellent. Thank you so much for having me. I'm really excited to be here. Yeah. And you have been in web 3 for a very very long time. Tell us about yourself and kind of like your provenence and uh uh what brought you into this space. Yeah, so I have been in web 3 um almost since the start. I really got in involved in earnest in 2011 uh when I had read the Bitcoin white paper and it really like clicked for me at the time. Uh it was just this thing that I read it and it just made total sense, right?

Like you know having gone through like 2008 and sort of seen what you know happened in terms of like you know uh financial policy, fiscal policy and you know what happened to a lot of my friends in terms of just like what happened to their careers and jobs and opportunities. Uh Bitcoin really just like stood out to me. I was like oh this makes sense. This is a narrative for the future. And it was pretty interesting at the time because there wasn't really I felt like anything else that was really competing for ownership of the future, right? And Bitcoin was this sort of like very revolutionary paper but more revolutionary than I think people give it credit for. Um it was the it was really a statement about using like the power of like math and mathematics to

upend um you know the control of the state over over money, right? And I really leaned into this idea that like money is imaginary in the first place. And that means that um you know anyone can create it, but to be successful at creating it and not have the power of the state to sort of like you know enforce it um you had to use something that would be universally uh secure for everyone. Of course that that was math and you know that just struck me the sort of elegance of it and you know it was it was something that I just immediately got into. So, I, you know, started mining and, um, got really involved in a lot of the early altcoins.

Uh, and that was really my start. Um, since then, I've done a really large number of things. I started one of the first Bitcoin exchange of the Czech Republic, uh, a year later in 2012. Um, that was a very scarring experience, but was very educational. Uh, for a little while, I was working like a Bitcoin hardware wallet. Um, I at the time I had a other career. I was actually a very really well-known um fashion photographer in Europe and I started a creative technology business. So I had actually started doing a lot of like creative technology implementations around uh a lot of stuff just in general as like the sort of fashion industry came online but also around like the application of things like bitcoin and

supply chain tracking and how we could use it for providence of like art. Um, you know, I was an early employee at Open Zeppelin and I first met Manu, one of the co-founders of Open Zeppelin in 2013 when he was working on a project called uh, proof of existence and that was like a timestamping service built on Bitcoin in 2013 and I had been really interested in using that to like um, do early NFTTS like using that as like the provenance for for art. Uh, so you know I've been in the space for a really long time. Um, that that's that's at this point ancient history. Sometimes people talk about, you know, now on crypto Twitter like how many cycles they've been and it go stretches back all the way to like 2017. And you know, it's funny because even in 2017,

uh, we had already done everything in a really strange way. You know, this sort of came up recently for me. I was at an event and people were talking about like decentralized AI. They were like really talking about like there's all this unused GPU power out there of like um you know teams you know like people who've got extra GPUs so we can put them as decentralized network and decentralized processing. I was like, "Wow." You know, like crypto people were working on that in like 2013, you know, like you know, you remember the Golem? Oh, yeah. Yeah. But even before Gollum, right, there was Made Safe um and uh what was the other one there? There was another one as well that they were trying to do these like

decentralized um you know, processing networks. And so it's funny to see, you know, to have been in the space so long to sort of see everything come around again and again and again. you know, we're sort of like back at that phase of like a bare market where we're we're all talking about like um mass adoption. It's just like, oh man, I've been like listening to the mass adoption like it's almost here. You know, people are like, we're still early. I'm like, really? Cuz I feel like I'm I've lost hair. I've gone gray, you know, like I've I've been through this like countless times and like we're still not there yet. It's still early, right? Uh so you know the journey's been very long. Um I think though kind of

interestingly maybe finally it's not that it's coming to an end but like maybe finally like crypto will move on right like you know it's it's it's pretty amazing that blockchain Bitcoin started as this really like political statement like we can we can affect political change through code through sort of like the spe free speech of like encryption And you know that power has has won, right? Like you know I I used to say this thing which you know now sounds probably really controversial but you know now it's sort of like a little bit of anacronism. It's kind of funny but I used to say that like you know

Bitcoin was an example of being like a revolutionary without violence, right? You could use technology to to affect this political revolution uh without violence. And it was really fascinating the past 10 years watching that sort of like really culminate in how the Biden administration treated um you know us shadowy super coders and you know and use and use language like you know Elizabeth Warren you know she's going to create a an anti-crypto army right uh to to go to war against the shadowy super coders just hacking away doing open source giving away their like time energy and lifeblood for free to the

internet and um and and now it's won, right? And and you know, we used to say like, you know, first they mock you, then they fight you, then you win. And and and it seems like now now we win. What what what's the metric by which you would say we've won? Um, well, I think the obvious metric is the president of the United States is allin, owns tons of crypto, has promised a strategic Bitcoin reserve, which funny enough, I actually suggested I think it's probably it's a bailout for crypto.

It's like 2008 all over again. It's very funny. I think to like you know there's that whole there's you know there's all these these sort of like adages that sort of like become so fun to use but you know you either you either die a hero or live long enough to be the villain you know so it's like Satoshi Satoshi or Bitcoin lived long enough to be the villain in some really weird way right um but but I mean if if you kind of think about um kind of the reasons for which I assume you and definitely me kind of had got into the space for it. It was kind of like um this idea that you could build things on this new form of the internet that

previously you couldn't build. So kind of like you could have these shared ownership structures, you could have individual agency kind of you would have the ultimately resilient and efficient efficient kind of substrate to kind of build stuff on top of. um you would have platformification and uh and um and with that um kind of a radically better user experience for for for your users and so on. Um and while I do agree that kind of like yes the president of the United um states has launched more than one shitcoin um I I I would very much say that this was not kind of what um what got us here in the first place. Right.

So kind of like in in in the process of kind of like winning um kind of that version of crypto that kind of we we we came here for um it was marginalized. Would you So so this is why I'm kind of pushing back on the kind of like we've won. I think kind of like yes someone's won but it's not it's not kind of like who I um and used to be. So, I I have a little bit of a take that's probably going to come across like a bummer, but it's like it's it's it's a little bit of a multi-art take. One of it, and this is something I was talking about for years now, is is that crypto actually never had a plan

for winning, which is actually pretty common in revolutions, right? like revolutionaries, they're like driven by this desire for the revolution, for this change, but they don't actually plan what winning looks like, right? And and oftent times the best most successful strategies for revolutionaries are just somehow to like implement like a perpetual revolution. And crypto had very much this problem where it didn't plan for success. And like most revolutions, it got co-opted along the way by the powers that be, right?

And I think that this has happened with crypto in many ways. Um, but the world also changed at the same time. You know, one of the the things I also used to like to say, there's a lot of things I used to like to say. I don't know what I like to say these days, but what one of the things I used to like to say is is that um you know sort of like the end of like the cipher punk manifesto, it talks about how like you know cipher punks have the like root access to the future, right? And that's like part of the power of it. You have root access to the future. And my sort of response to that is like, yeah, but what if that future was already a long time ago, you know?

And when we started crypto Yes. Yes. Because when we started crypto, right? I remember think about it. 2011 crypto started, you know, I um you know, I was dating my my now wife and her father had a video camera on his doorbell. He built it himself, his video camera on his doorbell. And the sort of like running joke in our friend group was how creepy that was. Oh my god. He has like video camera on his doorbell and there was like video cameras around the house and it was like creepy. This is like, okay, every time I'd go over, I'd sort of like, wave, okay? You know, dad and my girlfriend, I guess you're like watching

me, right? Um, and privacy was something that, you know, had already been eroded substantially post September 11th, right? Uh, I was, you know, I was in college in September 11th. I, you know, people today don't remember a world where you flew without security checks and you flew where you could go visit the pilot up front, where people trusted one another in society, right? Like people don't remember America and American freedom and global freedom before September 11th. It was a big difference, right? Like September 11th really chilled the nature of freedom.

You know, freedom went from the freedom to to the freedom from which is very very powerful and very sort of like autocratic switch, right? Um but but you know I I can always get off track here but but so when we think about when Bitcoin and you know and web 3 and all this started we talked about privacy and self-s sovereignty right and you fast forward to today and everyone has a door has a video camera on the doorbell right and people have video cameras in their homes nobody thinks it's creepy nobody thinks it's weird I know people with video cameras in their bedrooms right? Their security camera system has video cameras in their

bedroom and everything that happens in their bedroom is streamed live to Google or Amazon, right? And they're fine with it, right? So, a lot of the values that we had when we came into the space actually are no longer values that society really hold, right? Like privacy. What is privacy today? You know, before people would be like, well, I don't want the government looking at naked pictures of me. Today there's a million people making naked pictures of us using AI every minute, right? Like nothing is real anymore. We don't take anything to be real. Any information you might particularly give us. We, you know, before there was a sense of like you needed privacy because information somehow had truth and that truth is like

very scary if it was like something private. But today nothing was true, right? Like it doesn't even matter if it actually happened and people saw it with their own eyes. Like you know nothing is true anymore. So a lot of the values that we started web 3 with society no longer actually holds, right? Like young people even even not young people, everyone streams their life all the time. Everyone talks about I mean if you go on Tik Tok or Instagram, people talk about the most intimate experiences of their life, the most humiliating, the most degrading, the most uncomfortable experiences of their life and they they share it to millions of followers.

There's no more privacy, right? And people don't care about privacy, right? Like we gave it all to Zuckerberg years ago and and and we're fine. So, but do you think that's irreversible? Because kind of like kind of the optimist in me hopes that kind of this is this is um a uh a switch that we can kind of uh you know push back on um and kind of revert to this state of uh privacy by default. So, and I think kind of like I honestly I don't object to kind of like people streaming their intimate lives on whatever service. I don't care about that. But I think kind of like you should be able to kind of live a um privacy

um a a pretty private life if you choose to do so. So to me it's kind of about the choice and uh kind of like just because a lot of people don't value that doesn't mean that kind of like the choice itself doesn't matter. So I agree with you the choice does matter. Um but I kind of think two things. First I think it's generational. So and I actually think everything is like generational and like cohort-based generationally. Um, so I don't think that actually we can like teach new generations things that they don't sort of like naturally come to on their own. Um, but also I think there is this interesting tradeoff like

I'm not sure we're if you spent time in the Americas in the 1990s you were able to feel the moment in the 1990s and the early 2000s you could feel the moment when you were losing your privacy. And that's because we converted to the society that had credit cards and cell phones. And what happened was very slowly you couldn't access society without tools that innately spied on you. Right? I remember going to like Blockbuster and trying to like rent videos. When I first was going to get my own Blockbuster card, you had to have a credit card, right? like you couldn't

participate in, you know, renting a hotel room. You couldn't participate in renting, you know, uh uh, you know, hotels existed before credit cards, but you can't book a hotel today without a credit card, right? So, you can't you can't use a hotel today without giving up your private information, your privacy to the payment processors and all the different entities that exist in that sort of like data pipeline. So society slowly moves in a direction that actually forces you to give up your privacy or it sort of forces you out of society, right? Where it's just like, well, you know, if you don't have a um credit cards, you can't use Uber and you

can't fly and you can't have a hotel. So yes, you're you're welcome to have privacy, but you know, you're also not no longer able to like participate in society in general. Certainly in in many parts, you know, in America and a lot of like, you know, western cities sort of become de facto, right? It'd be very difficult to like exist without it. Um certainly you can, but the sort of like amount of personal effort gets really high. So eventually, like I remember when September 11th happened and I would just opt out of those full body scanners, right? I would just be like, "This is no, you're not going to like irradiate me to like, you know, just just pat me down, right?" Like, "Why are you, you know, today I just walk through the scanners, right?" Like, you know, it

was a decade of like hands up, the big worring machine going around you. Um, you know, it's like how much effort eventually society kind of wears you down because you also want to live, right? You want to raise kids, you want to like go to birthday parties, you want to like, you know, rent a movie. Um, you know, you want to go on vacation somewhere. So eventually it wears you down. I do hope that it's reversible, but I think it's probably going to have to look different than how we came at privacy, you know, 10 years ago where maybe it looks more like your real data is indecipherable from like the noise of your data, right? Like if you think

about like um you know the the value of like encryption like you know when you you know back in the day at least when you like encrypt your hard drive you just filled it up with noise and your actual data is indistinguishable from noise right maybe privacy of the future is um some version of that where your actual information is in is just just it's impossible to like you know from the outside of view distinguish it from the the the data about you that's not real, right? Maybe that's actually Well, this is this is uh this is strangely not very um uh not not very comforting. It's like um well, you know, the the privacy you now get is

um you don't know which of these 5,000 nudes of you is the real one and which one's just the AI generated one. This is just a Yeah. Yeah. Yeah. I know. It's it's bizarre, right? And maybe I am become a little bit pessimist but it feels hard to do it any other way now because you know like for me in my life like what it would take to unwind the you know the doctor office privacy documents that I've signed and like you know raising kids and you know like the the level of effort it would take would

require me sort of like leaving society. I think kind of like I think kind of maybe it's on us to kind of build alternatives um that kind of are usable for regular people but are still privacy preserving and u ideally things like self-custodial and so on. Maybe maybe let's talk about that a little bit later because kind of like we went on a very interesting tangent but nevertheless a tangent. Um maybe let's kind of talk about kind of like the I mean you you've um uh you were in web 3 for a pretty long time before you actually started Tally um the project we're here to talk about today. So um um in a nutshell um what was the set of problems that you

were looking to tackle in starting Tally? Yeah. So tally was um the sort of genesis of tally was you know a lot of the optimism that we're talking about uh I had felt that there's a lot of sort of like inequality in the sort of standard corporate system and how corporations work and how you know borders prevent you know sort of human capital from crossing them. Um, and I really thought that we could basically incorporate organizations on the internet rather than in legal jurisdictions and that we could use software to incorporate them.

And this software could define the relationships and mechanisms by which organizations came to consensus. Right? You know, blockchain comes to consensus through a very programmatic way. Well, humans also have to come to consensus. And the way we do it in the sort of traditional world um is very unreliable, right? You have to re rely on like legal system. You have to rely upon force. And there was this idea of course with like the Dow, you know, Dows like decentralized autonomous organizations were have always been like a big part of especially the sort of like Ethereum lore and the the Ethereum sort of history. And the idea behind tally was like, okay, let's say you could incorporate in software. Um, what would that look like? What sort of tooling

would you need? Like how would that be done? And it was pretty clear that actually be extremely complicated, right? Especially when you thought of like, okay, if you create an organization in software, it can actually scale to billions of people, billions of dollars, and it might exist for 15 minutes, right? Something that's not possible in the traditional world. And it brings incredible amounts of scale to to creating organizations. Incredible amounts of scale, right? Like you can just go today and create an organization on tally and it can scale to billions of people and billions of dollars and it costs nothing. You know, maybe a few dollars in gas fees, right?

Um so this is sort of like real origin and root of tally. And at the time a lot of people were thinking about Dows. You know, me and my co-founder we used to like talk about them. We were really interested in them. But the early incarnation of like Dows with, you know, with with an exception for the DAO, uh, was really kind of like these these cooperatives on the blockchain. They're sort of like very utopian ideas of like social society structures uh, built on the blockchain. And for us, it didn't really seem particularly useful. It was like, okay, that's nice, but I'm not going to live in a smart contract, and I don't need to like, you know, use all the sort of like obtuse tools to sort of like negotiate these things. But then we saw the sort of like start of DeFi, right? Particularly compound finance.

And they launched um a Dow to operate compound finance. And it became really clear what the opportunity was, which is there are not only going to be Dows, these decentralized organizations. But first, there are going to be protocols. There are going to be software things, protocols that are very valuable. They have a lot of money. They generate money. They generate revenue. um they control very important smart contract parameters and they really do need some sort of mechanism, some sort of tooling to intermediate political disputes and to come to consensus on things like changing the parameters and you know sending money and like updating things. So from there it was very clear that like oh you know when we looked at how people were doing it they're using

things like Google Docs and like Excel sheets and you know sort of like hodgepodge of different things. It was like okay really actually we need we need to start building the tooling and infrastructure to manage this. So that's where tally started. It started as a ta dowo tool. Today it's really grown into the infrastructure for tokenized organizations right. So you know in the beginning it was like primarily around like oh you create proposals and vote. Um today tally actually does the you know entire you know nearly the entire flow of operating a tokenized organization from um identifying the political stakeholders to uh launching the actual token to distributing the token into people's hands to the governance and operation of protocols um the you know administration of roles and

permissions uh to staking and and and value acrruel mechanisms so that the protocols that generate revenue have trustless modular structures for returning revenue. new to participants. So, it's really become this this complete platform for operating these these tokenized infrastructure, these protocols at really massive scale. You know, we just the other week we passed our big milestone where now over a billion dollars has been been transferred through our tools, which is which is an incredible milestone and sort of a statement to um how real that initial idea that we can, you know, make organizations and software really is.

Mhm. If you look at Dows today, I mean, I think kind of Dows for the past eight years or so, every year has been hailed kind of like the the year of the DAO and so on. And kind of if you look at the state of Dows onchain, by and large, they're pretty dysfunctional. So, kind of like what's what's uh where are we going wrong? Sure. So you're not wrong, but I think it is useful to to compare it to the alternative, right? Um there is a corporate entity structure in every jurisdiction on the planet and by and large the vast vast majority of

companies are dysfunctional, poorly run entities that eventually fail, right? The vast vast majority of them, right? um none of them live, you know, almost none of them live for hundreds of years or even decades, you know. Uh so it is useful to say to to like put into comparison that with Dows there's a a level of transparency that's currently part of the sort of like ethos of a DAO. Maybe the transparency doesn't actually have to be there. That that's sort of like another question which might solve some of these problems, but corporations don't have that level of transparency.

So because we don't see what's happening in regular corporations, we don't see how dysfunctional they are. It's only when they, you know, you know, Enron is a great example. It's only when they like spectacularly collapse, you know, or Lehman Brothers that we sort of realize like, oh, it was a show all along right? Um, but that isn't to justify the fact that there is a lot of dysfunction in in Dows today. I think there's a there's a number of different reasons for this. Uh the structure is still new. Still pretty pretty early. Um I think there have been So yeah. Yeah. It's still early. Still early. Yeah. Look at that. Look at that.

Maybe it's so early as just an excuse for not doing a good job, you know? Oh, we don't have mass adoption yet because it's so early or we're doing a bad job. Yeah, there's been a lot of dysfunction and it it has been disappointing. I'll admit it. It's it's been disappointing. I I think that there's a lot of folks now looking at ways to improve this and I cast a lot of blame actually on the previous administration on on the Biden administration and you know the the Gendler SEC where a lot of the a lot of the ways that Dows in the past you know four or five years have been structured have been deliberately structured to just play this kind of

like acrobatic yoga twisty thing around regulations to make it possible, right? Like when you think about how you know you build something in America and then you make a foundation in the Cayman's and then you have a agency in the British Virgin Islands that like contracts an anonymous dude in like Chile to like launch a token that's transferred to the BVI that goes to the foundation which goes back to the company is then airdropped. It's really kind of like many of these structures were set up deliberately to make it not work, right? Um, you know, you see this with meme coins, right? Like the industry has been hurt so much by this

sort of by this legis not it's not it's not even legislation, right? By these like rulings that make us contort into deliberately nonsuccessful structures. And the great example is the the sort of like foundation setup and design. Um you're supposed to you're a founder, you create this idea and now to make the idea work, you have to really protocolize and have a token. But to do that, you have to have another entity that does the token. And that entity has to be totally separate from you.

So you now have to give over control over what you're building and what you're trying to do to another entity that deliberately has to not be connected in any way and you instantly create an opportunity for there to be divergence in goals, right? And you this has been kind of like a root of if you talk to like a lot of the lawyers in the space especially and a lot of the the the people have you know had to build these Dows the this sort of like regulatory acrobatics has made it very difficult for these organizations to be successful. Right? They're set up deliberately to have to fight really

hard to make it work and then a lot of the energy and effort goes into kind of making it work rather than working on the thing that the the the project is about in the first place. 100% agreed. But don't wouldn't you expect if that is kind of like the main cause of dysfunctionality in Dows to kind of have a number of um uh grassroots Dows um kind of that are not incorporated anywhere that kind of just kind of chug along kind of in their a non kind of universe and kind of create value. So kind of because in principle I mean because because what you're describing very much arises from the fact that there is um this duality in

systems right so kind of we say kind of like okay the organization should live on chain but kind of like obviously things also things that kind of live on chain are constrained technically um at least kind of uh by by legacy legal systems right so by by kind of saying okay we will bow to at um uh ahead of time be before anyone even come comes to us. Um I I understand that that creates a lot of overhead and destruction and destruction and so on. But um why aren't there more functional grassroots Dows without any legal setup?

So I think there's a couple reasons there and and the first one is is that I don't think that situation that you describe actually can ever exist and the re I think compound is a great example right the compound DAO is not there's no legal entity behind the compound dow currently right and the result of that is that you have these sort of shark private plaintiff lawyers who buy a dollar worth of compound and then it goes down to 90 cents and then they file a lawsuit and they go after anyone they can find, right? So, if you hold tokens, if you're

a delegate, if your name is on it, they go after you. They name you in the complaint. You know, this is this is what happened to Pool Together, right? pulled together was a DAO a really cool organization and they ended up spending all their money and all their time and resources fighting these private plaintiff lawsuits where they were you know people in the DAO were named personally liable for this sort of like general partnership. So unfortunately you can't unless you have like complete anonymity which you know goes back I think to your earlier point around privacy. Um it's very difficult to actually have that state of a truly um you know decentralized org that doesn't have any of this because of the

regulatory setup allows these private plaintiffs you know legal uh folks to actually just go after any person they can find. Right. And this has happened. this is, you know, there's there's these groups of law firms that go around, they raise money and they just, you know, pick off these projects one by one. So, I think that is majorly a big blocker into making that sort of setup that you describe actually work. You know, uh, Rune with Maker for a long time, you know, was trying to require everyone to be private, to be anonymous. Um, because this risk is very real, right? like if they go after you and they say that's a a general partnership, they go after you for your dog and you know your children's school fund and your house, right? So, um I think that again it goes

back to regulations where you actually can't have that because there are these opportunistic entities who will just find any individual and hold them liable. I think that's kind of the root of it because if they have a US if they have a US angle, right? So, kind of like if if you're just someone on the other side of the world, say kind of like you're you're someone in in the Philippines, what would stop them from um starting an organization like this? Well, I think it wouldn't. Uh but what it does mean though is many actors who might be high quality participants won't participate.

um your access to things like uh on-ramps and off-ramps or trading loces is very limited. Uh all these things in aggregate work against your success, right? And if you do deal with US persons in any way, shape or form, those people become exposed. So yeah, you can certainly have an organization completely firewalled from the US. Um, maybe part of that is I don't really know about them, right? I'm in the US. I deal maybe more with like US entities. Uh, but it definitely limits your ability to have success. But this isn't the only cause. This is just

like one of many things. The I think probably what you're getting at is is that like people are messy and kind of like on the internet and they're very difficult to like, you know, coordinate to do useful things together. Um, no. And this is not what I'm getting at at all. So I think kind of like in in principle I think kind of like humans are the same offchain and onchain to a large extent. I think I wonder whether to some extent it's a question of culture right because kind of like in in Dow kind of like we have we have started dows with this idea that they're kind of like this egalitarian place and kind of like you you vote on everything and so on and I think kind of um not everything

should be voted on maybe this is my controversial take for today but kind of like if you're running an organization kind of like um uh kind of decisions are not mixed and match, right? Kind of like they they kind of you have to commit to a strategy and kind of you someone has to wear the hat otherwise doesn't work. And I think in principle there's no there's this is not impossible kind of you could have very hierarchical DAO but somehow that's not in our culture understanding of Dows. Um so Dows don't have a CEO and maybe they should.

Yeah. So I think you will see most Dows have a CEO going forward for the reasons you describe. Um I it it disappoints me a little bit but I do think it's inevitable and it's actually probably good especially in this period that sort of feels very inter intermediary like it's sort of like a in between time. Um, for some reason, especially right now, I think going back to like our principles, there was a time when maybe we're looking towards more decentralization and actually much of the world is kind of gone more centralized, right? Like the there's there's a very strong authority streak uh right now in the world globally. Even the idea of founder mode

is very much, you know, top down uh as as an idea that sort of like permeated the space. Um, organizationally also I think that these Dows have had problems in how they initially distribute their membership right membership is a big determinant of like success right like if you give the wrong you can't really say wrong but an organization has to have a culture and if you don't have an aligned culture it's very difficult to make decisions collectively especially when Actually everyone in organization has different cultures. I think a great example of this is salaries in these organizations.

Um you know some of these organizations are extremely valuable. You look at like unis swap foundation, unis swap dowo, you know this multi-billion dollar organization and you know people really complain about the foundation's proposal and how much they're going to pay people. And you have these sort of like participants in the space who are like, "Yeah, well, I got this cousin. He like, you know, he's in like, you know, some place and he would do it for cheaper." And it's just like this is one of the most competitive financial organizations in the world based in New York City.

They need to hire the most competitive, highly soughtafter talent that exists. That's expensive. And you have a natural divide between participants of what like a lot of money is and what a little bit of money is and what's worth something, what's not worth something. I think this comes up a lot between the sort of like programming community of Europe and the programming community of like San Francisco. Always on Twitter, like you know, European programmers are like, why does this person earn $300,000 a year when I earn, you know, $80,000 a year? And these sorts of like geographical issues filter into organizations too along with cultural ones. And it makes it very difficult for people to come to like a

common alignment, right? These organizations end up bickering about how much the dog gets paid instead of like what they need the dog for, right? And and that really drives these organizations to like do a bad job or like you know they sort of like descend and sort of the the there's a oh what was it? Someone was someone put it really well recently where decentralized organizations end up mostly talking about themselves and their organization rather than getting anything done. Uh which it's kind of a truism now that we think about it. Um, but not to get too far off topic, I think you were right that we will see

more CEO of Dows, right? Where, you know, if you read Miles Jennings, how, you know, A16Z and he are kind of thinking about what decentralization means, right? Like we kind of came into this years ago with decentralization meaning like everyone and their grandma participates in voting on everything. And you know, that has turned out to be a bad idea for a lot of different reasons. And now it's like well we have to redefine or sort of think what does decentralization mean right? Like who is involved in decentralization? Is it everyone on everything? Is it just the experts who determines what an expert is? What's the oversight? Um all these are very complicated questions which you know corporations have sort of figured out by just saying like he's the boss and these are the board members that

oversee the boss and these are the shareholders that oversee the board members. But I mean that's also a structure that's grown over time, right? I mean, it's not like kind of like someone I mean, we we've we've had corporations for hundreds of years. Um, and kind of I'm I'm sure we've tried out many different things that didn't work. Sure. And I mean, even now we kind of have different modi for operations, right? kind of like you you can have um you can have a cooperative, you can have a foundation, you can have a company limited by shares, you can have a public company and so on. And I think all of these kind of I mean to some extent kind

of you can you can transition between them but kind of they all kind of have found product market fit in a way, right? Yeah. Yes. Yeah. I we are I think in search of our product market fit for decentralized organizations but I think we have some form of it right like protocols have to be decentralized you know I think a great example is arbitum which is on like kind of like the grandest experiment uh of them all at the moment where they fundamentally are operated by their token holders and the token holders have an extreme level of power right like they they can fundamentally

alter the the way the network works. And you see this characteristic leading to their success, right? Their success being, you know, you look at like Tether having chosen them as being like their one of their new home bases. You look at the different organizations that build directly on top of them. And a big piece of that is because they have this certainty that they are building on top of infrastructure in which they have a tangible say in how it's governed and operated. So I do think that we've found that nugget of product market fit, right? Like you wouldn't trust uh you know like a Chinese company wouldn't necessarily build directly on an

American company because they're always exposed to like geopolitical issues, right? But you know a truly decentralized network um where you have a credible um share uh you know the platform itself is credibly neutral and you have a credible participation level on it that is very valuable right like that is something that you can trust and you can build on as as infrastructure. Um, something I like to say is like, you know, if you're building on Facebook, you're the next Zingga. And I think that idea of like being able to trust the infrastructure that you build on is super important, right? Because we've seen that in, you know, the web 2 space, um, you know, whether it's Twitter and the Twitter API, Reddit and the Reddit API, Facebook and Facebook API, um, if you build something that's large enough

and valuable enough, the underlying layer will steal it from you. Do do you think that's borne out by the state of which networks currently see uh developer adoption? Because to me it seems that there's kind of the the networks that are currently very successful. Um they are not the most decentralized. They are not the most credibly neutral. um they they are the ones that um uh somehow managed to hire the right marketing people.

Oh, that's a a spicy spicy hint there. Um yeah you know, that's a tricky one and it's tricky for a lot of reasons because you know who are the developers today versus the developers 10 years ago or five years ago and you know two years ago and I think that they look very different right like when crypto when I found crypto it was very much about self-s sovereign everything right and and and privacy and all this stuff uh I think people who find crypto today find it through very different mediums right like it's not coming to them through some you know uh cryptography newsletter or you know uh group chat it's coming to

them through you know memecoin prices and uh payments and stable coins and stuff like that so I think we're also maybe catering to a different um type of developer if you want to use like developer sort of like metrics right there's a different kind of contributor who is joining the ecosystem And I think this is, you know, I think a great example of this was NFTTS and video games, right? Like a big big big selling idea behind NFTs was like, wow, you know, video game, if you if you participated in a video game, you could own your loot and it would be portable between games and this is actually genuinely a really awesome amazing idea.

Uh, but the larger video game developer ecosystem came to NFTts through like board apes and like million-dollar JPEGs and they hated the idea, right? And then we could never get them off of that, right? Like they were like, "Oh no, Ethereum, it burns the rainforest and it's for dumb JPEGs." It's just like, "No, no, no, no. We built this thing to like make it better for everyone." And they were like only heard the scam and they entirely rejected it, right? So we we sort of like missed out on our entire like premise because they came to it in the wrong way. So I think today's developer base doesn't really come to crypto through the cipher punk um values or the web 3 values right in fact you

know I think you know a lot of criticism or going around is that we don't do a very good job of even like expressing those right for a long time you know the words world computer just stopped being used in the Ethereum space right it went from like world computer and like all this stuff to you know effectively just money money money money which was good for the price and you know I wouldn't mind some aspect of that coming back but that changes who comes in and builds and the centralization component it's efficient right the centralization is efficient in these organizations it means that you know someone is tasked with the responsibility of making each one of these developers who come in the door feel good and feel recognized and

feel unique and feel special and that drives participation right you want to be somewhere where people are excited. Um, you know, I've I I go to both Ethereum conferences and I go to both and Salana conferences and you know, one of the things that struck me about the last few Salana conferences I went to is that everyone's really excited about making money, but really excited, right? They're like, "Wow, we are all here. We're going to make money. What are you building? I'm building money, money, money. Oh, I'm building money plus. I'm building money, money, money plus. I'm building money with JPEGs." And everyone's like really psyched. And that sort of real clarity of purpose I think was is is extremely powerful for for that community right but you definitely

don't have people saying like oh actually we need to start decentralized right like you don't have that you have a very different ethos and that's totally fine right like this is not in any way a dig this is totally fine like there are so many more ecosystems in crypto today than there were in 2011 right in 2011 there was just one There's actually a couple really soon after that, but but today there's just there's just thousands of the communities. So, you know, some days it's like you wish it were a bit more decentralized, but some days you recognize that there's going to have to be some like path in the middle to make sure you get to that

product market fit to make sure you build something that works that people need to make sure that like you're focused on the task at hand rather than sort of like this real owneristic just like it's about how we organize all the time, you know? Yeah, I I think kind of I'd make the point that kind of like decentralization in itself is not a value. It's not kind of it's not something that people should pay to have. It depends on the use case, right? So, kind of like there's many things for which it's totally fine to kind of build on a uh proprietary network somewhere just like kind of like I I have stuff running on AWS. Um but uh yeah there's other things like I don't

know for instance if I if I had my identity on chain I would be very worried about having it on a poorly decentralized chain. So we've we've talked about kind of like the general DAO space for pretty long time. Tell us about kind of the things that are currently on your plate at Tally. So kind of what are you guys working on? What are you excited about? Um what do you think is going to me move the needle on um on how Dows um operate in the future?

Yeah. So at Tally, we are really excited about this new political landscape. Um, we can now build organizations or it looks like we can now build organizations that are more functional, that have more focus on success uh early on. Um, that allow founders to have higher agency that allow uh teams to build more transparently um with a lot of like the sort of like shackles and limitations taken off. So we actually think that we are probably closer to the original vision of like being able to you know incorporate organizations in software than we've ever been which is incredibly you know exciting. Um,

obviously the whole global economy is going through a little bit of a weird rough patch right now and you know I guess we kind of all have to see how that shakes out. But at its core, the idea now that you could just build an organization, you could incorporate it on chain. You can have high agency decision-m um but you can have a large community and by community it could be just people who have an opinion or it could be actually like people who have power, right? and who have operative power is really exciting. Um for us there's actually some pieces here that are still missing. Um you know very early on we recognize the need to uh have tokens that actually acrue value right. Um the problem with governance tokens and this is another big thing

thing historically the problems with governance tokens has been that we've had to specifically say they don't have any value and that negatively selects for the participants of your ecosystem. Right? Because most savvy participants aren't interested in like the the opportunity cost of like holding something that costs money but should be valueless, right? Like that's that's a horrible relationship. And that's actually been a big contributor to, you know, the the success or failure of different organizations. So now we're building a lot of great modular tooling around value acrruel for for tokens. Um you know we've been working closely with teams around the idea of staking using staking as this core primitive to uh drive the sort of like productive

behavior necessary to operate protocols um which we think is really critical for their long-term success. Um we also have been working really closely with teams to help launch their protocols right help launch their tokens. So really today it's about serving these teams in their whole journey and like getting them out there because if you look at kind of like the history of like where the stock market has been in terms of like you know IPOs I sort of stats here right in 2024 there was around 220 like IPOs you know 2022 there's like 175 when you look at how many organizations are actually launching on software today it's really pretty incredible and when you look at

how many of them are doing it on top of tally, right? Like just the number that like we've passed a billion dollars in payments like money moves on the platform really shows that like we have this really exciting opportunity to really compete with the wider ecosystem of like how do companies sort of like chart their path forward, right? you know, maybe we're going to even get to the point where um companies are going to realistically, you know, look at tally and say, "Hey, we would like to go token instead of even going IPO, right?"

Like this is kind of like uh this idea that really has gotten us very excited where we could actually be an alternate way for this new kind of organization to really go um public in a sense but in a very different way you know and and obviously within you know a now a clear regulatory framework. Yeah, that's very I mean this kind of very much rings of 2017 and I think kind of like this the the kind of ICO era in some way kind of it's been maligned and needlessly over the past couple of years. I mean yes there were pretty bad ICOs out there but there were also a bunch of really good ICOs out there. Um and yeah, so I think kind of

like having having this um way of um doing a crowd sale without and kind of having an investor base that's not necessarily kind of in accredited investors only and that's not um uh that that doesn't kind of require you kind of have prospectors and and and whatever. I think yeah I think that is tremendously um worthwhile and it very much goes back to kind of like this vision of shared ownership right kind of that we talked about in in the beginning as kind of like one of the core tenets of web 3.

Um yeah I agree with you. You know people love to uh speak negatively about the ICO boom but a lot of very good stuff came out of that. A lot of infrastructure got built. You know, SAFE was an I ICO project originally. You know, there's a lot of great Yeah. Well, yes, exactly. Full disclosure, it was yours. Um, you know, like there's a lot of actual great infrastructure that was built during this and there was a lot of magic around that capital formation primarily using an asset that was created from its own ICO. Right?

Ethereum itself was an ICO which I did not participate in because of you know sorry about that poor choices poor life choices. So, so yeah, in many ways like you know going back to sort of like certainly our original vision and I think a lot of people's original vision we can do incorporation vastly cheaper faster more efficient greater scale um by using software as our jurisdiction than we can using um you know uh you know Delaware and the state registars's office. So what we what we would like of course we don't want a world coming back where you know I think you know people love to knock like Dentcoin you know the the ICO like

for for dentists like that's like the the the running sort of like punching bag although I will note that they might even still be around um but uh you know and most businesses aren't a success anyway so you know it's hard to hold that against and we've seen the same with IPOs right I mean kind of like yes we have Google we have Google but we also have we also had pets.com Right. And kind of like that that went exactly the way that Dentcoin went. So it's uh Exactly. Exactly. And you know I I I hope that actually we get really clear regulation around this because the efficiencies and opportunities here for builders and you know I would be remiss if I didn't mention for the made in

America builders um is incredible right like that sort of like efficiency that opportunity is you you can't really ignore that especially um today when you know we we are finally even contending with the idea that maybe even like AI and machines are going to start companies and build software and stuff like that. So yeah, I would very much like to see we are very much positioning ourselves for a world where regulatory clarity allows us to build um many more exciting things where founders can you know maintain control over their vision for a lot longer um so that they can get to you know PMF. Um you know I think this is just you know extremely

exciting. you know, we just have to get through this little rough patch that we're in right now. But, you know, ideally, you know, the the president has promised legislation in the in the summer. So, I think by fall we may actually know what the future's going to look like. Yeah, absolutely. So, Dennis, where can we send people to kind of find out more about Tally? So, the most obvious place is Tally um or the website itself, tally.xyz. Uh, you know, we also have a newsletter, um, a podcast, uh, a Twitter as well.

Um, these are probably the best places to check check out. You can also follow me as well on on Twitter that I'm Dennis and Bertrram. Um, if you are building a project, if you're thinking about building a project, if you're thinking about building a token or launching a token, uh, we are probably your best partners for that in the industry. Uh if you're thinking about value acrruel mechanisms uh thinking about modular secure governance that you know secures tens of billions of dollars across the ecosystem uh we are your you know your best partner that you could have. So if you are you know a founder of any sort of sort or builder uh you know even legal right we have great great recommendations and experience helping teams set up um even the legal sides of

things. We're not lawyers but you know we can give you a lot of great recommendations to wonderful wonderful teams as well. U you know reach out reach out we can be your partner in this in this process and help you know help you succeed the way we've you know helped hundreds of other organizations succeed. Perfect. Thank you so much for coming on Dennis. Thank you. It was a real real pleasure. I loved having this conversation.