Epicenter - Learn about Crypto, Blockchain, Ethereum, Bitcoin and Distributed Technologies - Jacob Arluck: TQ Tezos – Meet the Independent Driving Force Behind the Growth of Tezos

Episode Date: March 10, 2020

We are joined by founder of TQ Tezos, Jacob Arluck. TQ Tezos is a company that works to advance the Tezos ecosystem by creating open source software and other public goods. It's been over two years since we last did an episode about Tezos and this was a good refresher on how that project is shaping up. We hear about the decentralized and permissionless nature of the Tezos infrastructure, the protocol development of Tezos, and how TQ is working to make Tezos more accessible.Topics covered in this episode:Decentralized nature of Tezos development and the teams that make up the ecosystemWho is funding Tezos protocol developmentPermissionless nature of the Tezos architecture and governance mechanismHow TQ is working to make Tezos more accessibleThe impressive number of development languages and issues around interoperability and comparabilityMichelson – the stack-based DSL (domain-specific language) and the shift towards Michelson 2.0The types of applications being built on TezosThe role of the Tezos Foundation and the Breitmans todayA look back on Tezos governance two years in, and the future of the protocolEpisode links: Amending TezosReflecting on Athens, the first self-amendment of TezosJacob Arluck MediumJacob Arluck TwitterTQ Tezos TwitterTezos TwitterEpicenter 2020 Audience SurveySponsors: Nervos: If you’re a developer or project seeking funding for an innovative idea, check out the Nervos Grants Program today - https://www.nervos.org/grantsThis episode is hosted by Sebastien Couture & Sunny Aggarwal. Show notes and listening options: epicenter.tv/330

This is Epicenter, Episode 330 with guest Jacob Arluck. Hey there, Sebastian here. You know, the podcaster listener relationship is too unbalanced. You know us a lot better than we know you, and we want to narrow that gap. So please do me a favor and answer our audience survey. It takes four minutes, and it will help us to continue producing content that informs and inspires you. You can find the survey at epicenter.orgs slash survey. And at the end, I'll tell you how you can get a free, keep key hardware wallet, courtesy of ShapeShift, to thank you for your time.

So thanks in advance, and on with the show. Hi, welcome to Epicenter. My name is Sibbe Sanquitio. Today our guest is Jacob Arluck. Jacob is the founder of TQ Tezos, their company that works to advance Tezos ecosystem by creating open source software and other public goods for Tezos. Now, Tezos is a project that I've not followed very closely. It's been over a year since we last did an episode about Tezos. This was when Arthur and Kathleen Brightman were on the podcast.

It was October of 2018, and I'm almost embarrassed to admit it, but that was really the last time I looked into it. So I was really pleased to do this interview with Sunny. I felt that it provided a really good overview of the Tezos ecosystem at the moment. You know, when we last did the interview with Arthur and Kathleen, this was right around the launch. There wasn't much of an ecosystem yet. And so you'll see that a lot has happened since then. And, you know, at some point, I think it would make sense for us to also have a conversation with the folks at Nomadic Labs, for instance, since they're, you know, right here in town. So anyway, here's what you'll learn. The decentralized nature of the Thaisos development ecosystem.

Who's funding protocol development? The permissionless nature of the Tezos architecture and the governance. system, how TQ is working to make TASOS more accessible. The impressive number of development language in TASOS, there are at least seven major ones and the kind of issues that creates around things like interoperability and composability. Mickelson, the stack-based domain-specific language, and the shift towards Mickelson 2.0, the types of applications being built on Tezos, the role of the Tezos Foundation, and what the Breitmans are up to today, and a look at Tezos's governance two years in and what we can expect in the future.

So as I'm recording this, ECC just wrapped up in Paris and I spent most of the weekend sleeping. It was so exhausting, but it was a lot of fun. I mentioned here before, but we had our own podcast studio, which allowed me to pack in a bunch of interviews. I used that thing to its full potential. I recorded a bunch of long-form content, but also some shorter interviews that we'll be putting out in the next couple of weeks. So we're still sorting through all that content, but you should see the first bonus episode

show up in your podcast feed this week on Thursday, if all goes well. So this is a panel discussion that Frederica and I did with Jerome de Tichet of Ethereum France. They're the association, the nonprofit that put on the conference, Consolosal of Consensus Diligence and Cassidy Daily of centrifuge. So we talked about a lot of stuff, a lot of current event things that are happening in the defy ecosystem like the whole flash loan. episode that's been happening over the last few weeks. And we also talked about the state of

Ethereum in these uncertain times, let's say. Anyway, I can't thank Pepo enough for helping us put this together for being our partners in this podcast studio experiment. It wouldn't have been possible without them. And it's something that I definitely plan on doing again in the future. although right now it's uncertain if and when any conferences will take place this year. So hopefully things will come back to normal sooner than later. I also want to thank everybody who came to the meetup on Wednesday. One of the things that I love the most about doing this podcast is hanging out with our fans because our listeners are some of the nicest, coolest, and smartest people in the crypto ecosystem

I don't know how we managed to get all of you to listen to the podcast, but somehow you're all here. And every time I hang out with you guys and gals, I feel like I'm just hanging out with a bunch of friends. And it's always so cool and I love it. So thanks for coming and I look forward to seeing you at the next one. Before we go to the interview, I'd like to tell you about our sponsor for today's episode,

the Nervous Ecosystem Grants Program. The Nervos Blockchain went live recently and they're funding innovative ideas and developments to the protocol. So if you're a developer or a project and you're seeking funding for your innovative idea, or if you're interested in making a significant contribution to building out the Nervos infrastructure, you should explore the Nervos Grants program because they have a total of $30 million in funding available. Now, you probably heard the interview we did with the founder of Nervos, Kevin Wang, in January, but Nervos is a proof-of-work blockchain with a unique layered architecture. It combines the security and simplicity of Bitcoin with the flexibility of Ethereum.

So on layer one, you have the common knowledge base, which is reserved for security and store value, while layer two is used for computation and scalability. So to connect with the team and learn more about the grants program, including how you can apply and the types of grants that are available, please go to nervos.org slash grants. And with that, here's our interview with Jacob Arluck. We're here today with Jacob Arluck. So Jacob, thanks for joining us today. Yeah, happy to be on. So please tell us a bit about your background, how you got involved in crypto and how you got involved with Tazos. Absolutely. So actually used to work in the biotype life sciences space. And in 2018 or so, I was really even before that back in, you know, sort of 2016,

seen had been sort of my interest was peaked again in in the space. Actually, a lot of people get, you know, sort of got back into the space after the lull of like 2014, 2015, because of, you know, sort of Ethereum. Actually, for me, it was more that I was really interested in things like Zcash actually launching and some of these projects that had been like white papers back in like 2014. Cosmos actually was, you know, another. It's like sort of these things that were resurfacing, you know, that there was actually code. There was actually, there are actually people, you know, working around these projects and that sort of thing. And then in early 2018, obviously, you know, there was, in late 2017, there was like a lot

of the Tesos drama. There was, you know, sort of a lot of, you know, sort of, you know, the project seemed like it wasn't, um, her Tesla was one of these projects as well that basically I was like, you know, had been following, you know, for obviously a really long time. I've always been really interested in like sort of coordination mechanisms personally and really interested in, you know, sort of decentralized governance and these kinds of questions, like even back to like sort of undergrad and before. Tesos was just like actually coming out.

I sort of thought it was a more academic approach to it originally. And I also thought that originally, like, it wasn't something that, you know, would actually make practical sense. But then when I actually saw in 2016, like with the Dow Fork and like a few other things that happened in that time, then even like all the rumblings around Bitcoin governance and that sort of thing, became very, very interested again in some of these ideas. And so in early 2018, sort of got connected to the folks after the foundation mess had been Resolve sort of got connected to the project and you sort of got involved around the launch in Paris,

which was, you know, in, you know, in June of 2018. But obviously from, you know, New York and basically, you know, wanted to spin up an organization that was really the thing you realized was like there wasn't much focus around building these key public goods to establish an ecosystem. Like when you look at Ethereum, the reason it's been a huge success in my opinion, in addition to like the fact that it's sort of really, you know, has this powerful ethos and developer culture and all this kind of stuff. And also being the first like, small, you know, useful smart contract platform.

It was also that they just had really invested in like, you know, robust public goods. You know, that took many years for them to build, get to a state that could actually be used by major companies, by any random developer or whatever. But the goal that we set out to is like, if we're going to scale up, you know, to be, you know, something that's, you know,

global, that's widely used, et cetera, it's going to need to be able to be able to, to, you know, sort of onboard all, you know, all these folks. And there's going to need to be sustainability around how public goods are, are, you know, sort of maintained and managed. So down the road that led to, you know, sort of the creation of a lot of other, you know, a lot of other, like, subproject here, but the founding es of the company and of the project here that we're, you know, that we're working on is sort of around, you know, how do we kind create the key necessary building blocks for people to build, you know, to feel like it's an

ecosystem where they, they're comfortable to get started and build a business or build a, build an application or, you know, anything on top of. What do you see as some of the most important public goods in the Ethereum ecosystem? Is it like some of the stuff that consensus was building with like Truffle and Metamash or is it stuff from the EF? Like, what do you see as the most important ones? from the EF, it's definitely the EIP process itself, I think, is like really underrated as a, as a driver of Ethereum success, but also like a lot of the focus on security auditing, a lot of the focus on around privacy research, like a lot of like cutting edge stuff that a lot of people don't even realize BF is sort of behind. And then you have consensus stuff, which is like really, I think really underrated. People like to bash consensus for being becoming very large and for, you know, trying to influence everything. A lot of things. Ethereum, but the thing that they got right, I think for sure, is having things like Infura, having things like Truffle, having things like Metamette.

Like, those are, like, with all those things, having a long-term, sustainable, you know, sort of funding source, Ethereum, because it would be pretty impossible to, to maintain its lead, I think. But it's not just that, it's that when you go to another ecosystem, like, if you're even giving up one of these public goods, you're like, I don't want to go there. So the one of the things we hear constantly is, like, where's the Telos version of Metamask? You know, we have things like Infura on Tesos already. We have things like with Truffle.

Literally, we work with Truffle. They're launching on Tesos support in March. Now the thing is like, where's MetaMask? I want to build an application, but there's no, you know, there's nothing like MetaMask. And so basically figuring out how to make sure that we have all those key, key public goods that there, and then also down the road, the idea is to build decentralized processes and other mechanisms for identifying gaps and funding them and then and also properly managing them. And you can get into like sort of how we think about how to tackle all these different, you know, sort of parallel but connected problems. But that's sort of the way we come out. It's like right now, let's get up to speed.

Let's catch up to Ethereum. Let's compress the like two years of Ethereum. Things like opens up on all these things. It took a while to develop, right? But it like when you go to Ethereum, it's as if like those things have always been there. If we could jump that, we could skip the line, so to speak and just get a lot of these public goods. And I think if you look at other new projects, Cosmos, a great example. A lot of the focus is on.

like what are the other things that you can pull out of the box to compose with your with your custom chain or whatever right the polka's doing that cosmos is doing that um you know folks like cello are doing that when i think that that's going to be like what what really drives like adoption or rather that's what's going to people talk about like what eat killers look like or what will start pulling people through the funnel away from ethereum or off of ethereum it's going to be things like that at a minimum that's what you need to have in order to do so cool we'll jump into talking about some of the public goods that you guys are kind of working on directly in a minute. But before we do that, could tell us a little bit about the name of the company, TQ Tezos?

Because, you know, when I first learned about the story, I was like, oh, my God, this is the perfect name. I love this name. By the way, when I first heard it, I accidentally mistought it stood for Tezos Quorum. Which is our conference series, which is like our main conference series. Yeah, which is the main Tesos conference series. And we obviously, you know, play a big role in that as well. the head of TQ Allison Mujero, she's actually a political scientist by training. We were basically thinking like what would be some cool things to name, you know, names for this organization.

And the original one that we wanted was that we talked about a lot was Voltaire. So Voltaire was one that I was really excited for. And then we were like, well, wait, we should probably, you know, these are a bunch of dead white guys. We should probably go back and make sure that they, you know, see what some of their positions were and see what they did anything that would like scar or company down the road, you know. And so I went up and looked up Voltaire. He had a lot of views that were not in line with current thinking. And I'm sure, you know, De Tocqueville did as well. But his were pretty egregious, like some really, some of the things.

So we're like, well, what about Alexis de Tocqueville? And we're like, well, wait, you know, Tesla's obviously has his origins in France. And now we have, you know, this entity here in the U.S. Well, they're not entirely in the U.S., but, you know, mostly in the U.S. And what if we named it after the Tocqueville? and we're like, well, that's fine, but like when people hear Toakville, they think of like marijuana or something, like, you know, toking or something. We've literally heard people say, like, why do you call it that? Like, whatever. Like, so let's come up with an abbreviation. That's really catchy and really easy to say and whatever. And he came up with TQ. And so then that's stuck. So everyone just refers to us as Tucking. Can you just give a brief explanation of what Tocqueville did? Like, what was his main body of work? Oh, yeah, yeah. And that's the other thing, right? It's like, so as I said, like, he was like a, you know, basically a. What he did was mostly precursor to, like, what were people called political science now.

We used to call it political economy back in the day. That's what my minor was in. Oh, yeah. Nice, nice. He basically wrote this book called Democracy in America where he sort of went up close and really analyzed like how the American psyche and American like sort of social norms and things sort of differ from his homeland in France or just Europeans in general. And a lot of it is around like the relationship between notions of like how folks interact

with authority, how folks, you know, sort of think about power and things like that. And, and those are all topics that we're super interested in and part of the inspiration. Things like Agora, things like the Telos governance process in general, like, we're really interested in, like, what are the institutions that internet native institutions that we need to create around, you know, the Telos ecosystem, you know, to really make sure that it, you know, sort of fulfilled its, it's like sort of long-term, long-term goals and mission. There's lots of parallels to, to that, yeah, for sure. So give us a sense of who the major players are in the Tazos ecosystem and how they interact. You know, if someone was coming at this for the first time and wanted this sort of, you know, mapping of the Tazores ecosystem, what would they see?

So I think the place to start is like you obviously have, you know, the main architects and creators of Tessos, you know, most of whom sit in Paris at nomadic labs. And nomadic labs, you know, one way to think of it is is sort of like, parity for Pocodot or, I don't know, tendermint team in Cosmos or, you know, whatever, All Empaths, rather, in Cosmos or one of these just sort of founding teams that created the protocol and thus, like, has an obvious role as, you know, in some capacity, stewards of the network or feel some responsibility for, you know, improving it and whatnot. But the nature tells us, and we can get into this is just, you know, obviously it has this multi-stage, on-chain governance mechanism.

And so in practice, there's no canonical core dev team. There's no canonical group that is the steward of the chain or whatever. But, you know, obviously in practice, you know, these things tend to fall back to, you know, a team that, you know, given that tells us written out of Camel, there's very few OCamel devs in the world. It's not surprising, right, that these folks are the main stewards of the core of the shell, all these, of the protocol of the shell, et cetera. And then you also have, you know, other sort of like core dev teams that are contributing to a lesser extent, but obviously still important.

And so you have folks like Cryptium Labs who are based in Switzerland. They're both a validator as well as a they work on core amendment, you know, core protocol amendment proposals and things like that. And then you also have folks like DiLamda, which is like a company in a small company in Japan that's also, you know, part of part of this process. We actually have a couple protocol devs here in New York and including a member of the the merge team. And that's someone on our team who contributes to core development as well.

So that's sort of how core. or shakes out. Then above that, you have different language teams. So you have things like Lego. And Lego is a language that compiles down to Mickelson, which is the Tesos, you know, sort of smart contract, ESL. Then you have like teams like smart pie. You have teams like, and then there's others like archetype and and S. Camel and Alper.

And like there's sort of these teams that are working on some of those angles. Then you have folks working, sort of like some of the layer two projects. And there's folks like, you know, there's a couple of them. You know, one of them is in, in Japan. you know, called CryptoEconomics Lab. I think they also developed a thing on Ethereum called Plasma Chamber. They're doing a lot of work around optimistic roll-ups and OBM stuff on Tesos. And then you have, you know, obviously entities like ours.

You have entities like the Tess Commons Foundation as well, which is like sort of a community organization. We collaborate a lot with them, particularly on things like Tessigora, which we can get into later as well as other projects like LabNet and other TESO's projects that are really focused on fostering an open, you know, decentralized governance process. And then you have these sort of these, there's all these other entities around the world that are working on TESA adoption or TESO, you know, projects. Like, so there's teams in, you know, in Brazil, there's a team in Brazil, there's a team in Israel, there's a team in Ukraine, there's a team in Japan, there's Korea, there's Southeast Asia, there's China in Hong Kong. I mean, all of these actually have full-time folks working on TESO's projects or working towards TESO's in some way.

But all in all, yeah, I'd say that that's sort of the basic lay of the land. And then, of course, you have the TELS Foundation, which is sort of serving as an endowment that basically funds some portion of ecosystem activity. They're sort of also, you know, sort of help, you know, could be coordination in some capacities. They, you know, sort of undertake strategic projects. They'll talk to folks who want to build something on TESOs. They'll talk to folks who are thinking about, like, doing equity investments in people, you know, building something on Tesos, stuff like that. So a lot of what their role is is more as like a

funding source for certain parts of the ecosystem. You know, obviously we work with them pretty closely, especially around the public goods, around things like the Tesos conference series. Even from describing it this way, it's probably still a little confusing. The basic way that this thing is the scientist is so that like, yeah, you basically have representation of Tezos in all these key geographies around the world. Pretty much every continent, other than maybe Australia and Antarctica probably has some kind of meaningful, full-time Tesla's presence at this point. There's basically a lot of effort going forward to figure out what other entities should be spun up, what other types of funding vehicles should we spin up for things like ecosystem public goods and other matters.

There's a lot of very decentralized development going on. How do you coordinate this? And are there ever any situations where this comes into an issue? For us, actually, at Cosmos, you know, we're kind of going through this process right now as we speak of, like, decentralizing our development. So it's like get some learnings from a team project that already is in that, has done that. There's a few areas actually where I think there's a lot to learn. So I think the first one is, you know, it's obviously a big question around who's funding protocol dev, who's capable of doing program? of what's the barrier to entry, those sorts of things.

Around Tezos, the barrier to entry that's sort of from the beginning has always been around OCaml, right? And as well as just functional programming in general. So functional programmers just kind of think differently than, you know, traditional developers, they write code that has to be maintained probably by other functional programmers. In Tezzo's case, a lot of the opportunity for decentralizing protocol dev, you know, at the protocol core level seems to be the biggest opportunities around trying to, you know, sort of refactor the codebase or build tools and documentation about parts of the codebase that are poorly documented so that folks can very easily get started. Understanding that there's probably

the smaller subset of the total devs in the world who can actually ever contribute to Tesos, but at least we can capture a larger share of them. And in practice, one of the analogies that I was used for blockchain broadly is that people always talk about how WhatsApp sold to Facebook for $19 billion and had something like 15 employees. Some days a set of blockchains could run, you know, trillions of dollars in global GDP, but only be supported by a small number of deficit relative to that, right? You could have maybe it's even a thousand developers who, you know, basically support software that powers, you know, trillions and trillions of dollars of value.

We don't need to get the number up that much. We don't need to, you know, build that, you know, get that many folks. core dev. It's more so a matter of just getting it, even doubling, for example, what we have today, or the accessibility doubling what we have today would make a huge difference. And then you look at Ethereum Ray where it's a lot more accessible to get into core development, but the roadmap is so complex so that there's sort of a different kind of barrier to entry, which is around, you know, who can possibly build a sharded, you know, proof of stake, highly scalable, you know, blockchain infrastructure. So that barrier to entry is a really big one. And there's not a lot of folks who, for example,

know there's a very small number of folks who can even work on zero knowledge. There's a very small number of folks who can work on doing sharding and cross-chain interaction and like clients, all this kind of stuff. And where I think it'll all go in the long run, sort of stems from, you know, basically what are the incentives to improve the core? Tazos has, and Cosmos as well, have, you know, sort of on-chain funding mechanisms, right, to incentivize core development. It hasn't really been used yet in TESOS, you know, the way that sort of folks love to talk about. So there's a lot of hype and discussion around, you know, sort of using this concept of the invoice in Tesos, which is basically where you can attach a one-time or a recurring reward for proposal that you submitted to improve the

protocol. And this can all be done on-chain, fully on-chain in Tezos, whereas in other networks you need to, maybe there's a treasury and people need to vote on it. And then the development happens, you know, sort of off-proposal happens. The execution of the amendment proposal happens totally off-chain. You know, I think in Cosmos, right, you guys don't do automatic upgrades, maybe you're moving towards doing automatic upgrades down the road, but you vote on a proposal, and then someone goes and implements it, and then it gets, you know, you hard for it to adopt it, right? In Tezos, it doesn't work that way. The architecture is inherently more permissionless. That said, there is probably more bearers to entry around who can actually work on this thing,

as well as, given the unique skill set that's needed, you know, getting funding, getting up to speed and then also thinking that your amendment even has a chance of making it. It's very hard to say right now in any of these networks. If I start, you know, very smart, you have a really capable team and they sort of say, we want to submit these changes to the core. Do they actually have a sense of what the expected chances of success are? So that's one of the things that we're really interested in, especially where we want to take Agora, is basically creating a lot more legibility around what are the needs of the project,

especially at the core level, and then creating an open permissionless prioritization systems, like using, for example, prediction markets or in combined with signaling. So if you think of some of the ideas that have been put forth by Dowstack, there's a lot of interesting sort of mechanism design ideas for, I think, we're basically using that to something like holographic consensus or some derivative of that to prioritize potential protocol amendments and thus justify decentralized funding of those things. So that's one of the areas where we definitely are interested in taking it. If a project can sort of get to a point where they can do decentralized open source development

of one of these core protocols, turn of phrase that I use is, if you can get teams that hate each other potentially to work around the same coordination mechanism, you know you have a good mechanism. Like that's like a base layer expectation for an institution is whether or not it can coordinate and manage like sort of competing priorities and people who don't like each other. one experiment that's really worth making is probably around making the needs of the platform legible in some way, even if it's just in a limited area at first, then trying to build mechanisms that can help inform prioritization of those things. And this would all be off-chain, by the way,

for now. I mean, parts of it would be executed. Do you have teams in the Tesos core development community that hate each other? I don't think so, no. I think there's obviously tensions between, you know, sort of core and there's inherent tensions between the different stakeholders. holders of the ecosystem. So you know, you have bakers who have one set of incentives. You have token holders, you have one set of incentives. You have smart contract developers and enterprises. You have core teams and folks who are really interested in functional programming. Balancing those different priorities is really important. And in order to do that, you need to have a mechanism for making legible concrete needs and then fostering discussions and then enabling prioritization

of those. In all politics, all institutions, you end up with agenda setting as more important than the actual vote, right? So in like the U.S. Congress, in most parliamentary systems, the outcome of most elections and most decision-making processes is pretty well known well ahead of time. And that's because most of the game is not around the actual vote. It's around what even gets put up to a vote. Obviously, that's set on based on like sort of who has control, who has, you know, the most votes in this thing. But where it all eventually plays out is in the agenda setting component of the process. And so that's what we're thinking a lot about now and how to improve that so that you can introduce some of the permissionlessness and openness that you have of the on-chain system, off-chain,

to summarize it that way. And that way to sort of just bring it more into harmony with the expectations of all the stakeholders of the system and then prioritize those expectations accordingly. Permissionless nature of the architecture. So we think of blockchains as like permissionless application platforms, right? I think it's the first time that I've heard someone use that term to define and characterize the development and the evolution of that blockchain itself. And I think like that's one of the things that characterizes Tezos is the permissionless nature of how the protocol evolves through the on-chain governance system. That's an interesting thing to think about it.

It's like the idea of like building an autonomous internet native infrastructure institution. It's like and there's lots of folks in other ecucuses like, you know, Vlad or whomever who will get scared, you know, start shaming you for using this framing. But I think that's where the Tesos is really amy to be is trying to become from kind of, I think it already is well on its way, but the long-term goal is to try to become a fully autonomous organism or whatever we want to call it that basically can power, you know, obviously all the source of crypto-native and internet-native institution in use case. So whether that's asset settlement, whether that's Dow's, Internet native organizations,

those sorts of things, power items inside of games in an autonomous. Like, you know, you can imagine in-game economies that are totally autonomous. And in terms of the scale at which you can have a, you know, you can run an MMR-G, for example, that has, yet mediates economic value or something like that. Like, that's what you hope these kinds of architectures make possible. Generally, we're just trying to introduce a lot of these, if you think of the process right now as, you know, sort of a lot of soft, you know, and normal human processes also involve GitLab and whatnot that then lead to this permissionless and hard on chain process. Imagine that where we think a lot of this is going to

probably go over time is, at least in our team at, you know, at TQ or the, you know, in some of our conversation with other stakeholders ecosystem is towards widening. Along that, journey, like moving the permissionlessness a little bit outward and more into the agenda setting part as well. Tell us what TQ focuses on specifically then. One of the main areas where we focused on to date is really around smart contract development and standards, as well as like working with some of the key language, like the new smart contract language projects that make Tesla's development a lot more accessible, as well

as working with folks like, you know, Truffle Suite and sort of some of the well-establish development platforms for Ethereum. We also work with companies that are building on Tesos, and basically, you know, sort of a lot of that is around tokenization and digital securities. And there's a host of other use cases that we haven't yet communicated on, but a lot of the thinking in our team is, how do you build this kind of ecosystem around Tesos, given, you know, sort of its starting point, which was sort of with, you know, it launched. It had obviously Mickleson and a very, the joke is like a very low gas limit, a very, it just

wasn't really built for public consumption, you know, initially. You sort of didn't have really good tooling. There was lack of testing infrastructure. There's lack of basically what you lacked was a feedback loop around people who would want to use the platform. So basically what you have is no users, no feedback about the languages and the tools and all these things. And thus, no users as a result of that too. It's like a that spiral of lack of use, right? And so what's happened since, and this is really a testament to like all these different teams that are working like their butts off to make Tesos more accessible.

that's why we ended up with so many language projects, but where we've come in a lot of times is, you know, we'll find an area, for example, and an obvious one is around like, say, token standards and stuff like that,

where we're thinking, well, basically we have all these people who want to build stuff on Tesos, but they don't want to have to build their own, you know, token standard. They don't want to have to build their own

JavaScript library, like a Web3. Like when they're coming from another ecosystem, they have to then worry about whether or not they have these public goods that they would otherwise have in Ethereum. basically trying to foster the creation of those. So we initially created something very similar to ERC20,

and that's what we've used in a lot of the ecosystem uses for, obviously it's different tokenization projects. But since then, we've been working for many months on thinking about how to build sort of a better token architecture, like treating the token standard as more of a, almost like a platform for people to invent other kinds of token types and token-based applications without being constrained by,

for example, one particular token architecture. So, you know, obviously in Ethereum, you have the success of ERC20, ERC 721, and then, you know, obviously folks have tried to foster some other more. If you look in the EIP repos, like, you know, you'll find just so many different failed standards and whatnot. And instead, our government is like when you find that ERC 721 and ERC20 don't work for you, like you don't have to even worry about a lot of the base like transfer semantic or a lot of the base, some of the like how you connect to permissioning around your token and instead you can focus on building some kind of token type or finding some kind of token type that will thus it'll already

be supported in wallets but you can customize it like a lot of the behavior of that token those are the kinds of projects that we're undertaking we also work on more meta of all of this with the telecommonaution we've created this platform for discussions as well as governance visualization and other that's what initially is is like sort of a governance explorer plus a discussion forum sort of like that's very similar to ETH research in practice. And basically that was created to discuss protocol amendments, to discuss changes that are coming to the platform as well as, you know, speculative ideas and trying to, you know,

sort of foster the community around research and development, as well as making easier for folks like bakers and smart contract developers to understand and discuss like some of the changes that are coming down the road. So we built that, that Tesla-Igora platform over last summer and launched, in the fall of last year, and it's been really instrumental, we think, in fostering discussions around some of the controversial amendment proposals that have emerged in recent memory. So there was this amendment called Babylon, for example, it was sort of this really big test

of the amendment process because there was a bug discovered in it halfway through. I always think of the joke that I make is that it was a much smaller version of something like the Dow hack and Ethereum where you just get to this point and now we're like, well, you know, we have to make this decision. And there's pros and cons of either one. And it's more so about making the decision in a way that has a high degree of social consensus and moving on rather than about like the exact details of that thing. And so Agora was really important around mediating a discussion of really, really high quality, shockingly high quality for people on the internet discussion around that particular dilemma that was facing the community. That's one area.

I guess we'll come back to the governance stuff in a second. but I'd like to focus, start off by one of the first products that you mentioned, which is sort of this coordinating of these different language teams. One of the jokes I had about Tezos ecosystem is that there's more languages being developed than actual applications. Obviously, that's maybe a joke. There's probably some applications being built as well. Every team that's working on in Tezos is developing their own language. And so why is this happening? and how does this affect sort of the composability of applications in the Tesos ecosystem?

It affects it a lot, yeah. So basically it's kind of a joke about functional programmers is that they sort of are into these kinds of projects because they're really into, you know, sort of programming language theory and that sort of thing. It's definitely true in our ecosystem. So there's a lot of folks who just have opinionated views about and just enjoy the art of creating, or the science of creating programming languages. is. And no programming language on Tezos out of the gate was widely usable enough that it would gain the kind of network effect that solidity has. One quick question here. How many languages are there?

So there's Ligo, Smart Pie, archetype. There's all the Haskell flavors. So that's like Morley Lorenz and Indigo. So that's consider that one. So that's four. Then you have Dejuvix project from Cryptium Labs and Christopher Goes. And then you have S-Camp. which is a Ocamill compiler to Mickelson. And then you also have Albert. And Albert is like basically a intermediate representation, I believe, that basically makes Mickelson a lot more readable. But yeah, so you're talking, let's see, two, three, four, five, at least ten.

Six, like seven. Yeah, yeah. Well, there's seven like the meaningful ones. Yeah, for sure. There were also some older ones like liquidity and fee, which nobody uses anymore. But we're obviously in the early days, that's what was around. in practice, we would argue that there's probably three of these that are getting any kind of use. So, Ligo, Smart Pie, and the Haskell ones are the only ones that are getting significant use.

I'm sure there will be some folks who try archetype offers like some formal verification tooling. And then you have Albert and also just Mickelson itself, which also offer a bunch of formal verification tooling, where maybe there will be a few things written in these. But there's a lot of languages, and that's because of, I think it's mostly a cultural thing and the nature of, these languages sort of taking a while to become fully useful the way that like solidity is in Ethereum. The bigger problem is interop between all these languages. So in Ethereum, you have things like the API or you have like, you know, sort of people are, you know, defining contract interactions and sort of in a harder way. This doesn't exist in Tesos right now. And so one of the

challenges is that, yeah, there's interop requires between some of these languages can require, you know, people, whatever is called glue code or whatever, you know, to basically a dongle between applications written in different languages. I don't think this is as big of a problem as people think. So in practice, probably there will be a power law around two of these. And then it's just a matter of probably trying to create some kind of something akin to the ABI in Ethereum. And so I've heard on a recent Tesla or a thread, there was discussion about basically turning

Mikulsin into a lingua franca for all of these different languages. So creating really clearly defined interaction, basically clearly specifying an underlying semantic or whatever interface by which these different contracts in these different languages can interface with each other. So we've mentioned Mickelson a couple of times. What is Mickelson? So basically it's this stack-based language that Tesos contracts compiled. It's like a DSL that's interpreted to OCamil that basically people can, you know, write

these. In theory, you can write it by hand yourself and write a contract. in it, but the best analogy to give is probably that it's like, it's like a very, imagine if the EVM was like a bit more readable. You had this stack based language that people were, you know, could basically write contracts in. And then basically in practice, what it has become is a compilation target for all these different new languages that have come out. So, Lego and SmartPy and archetype and all these things. Most of them just compile down to. Sort of like the EVM bytecode.

Like there are some people who will go ahead and handwrite. EVM bytecode, but I'm not sure people want to do that. And so it's the same thing with Michelson. I've also heard some discussion around a shift from Michelson to Michaelson 2.0, whatever that might be. Could you tell me a little bit what that is about? So I think that's still shaping out. There's basically a desire to definitely move forward something that's better

serves as an intermediate representation so that people can basically compile these higher, like if all of the contracts are going to end up in these higher languages, which we all sort of expect, that you want to build something that's just a better intermediate representation. And then you can build had compilers. You can build all sorts of good, you know, better tooling and formal verification tools around across these different languages. Right now, there's been a lot of effort expended on this library called Micho-Cock. So it's a cock representation of Mickelson. There's contracts that have been written in Mickelson and then specified in cock and with people proving properties in cock of Mickelson contracts. The idea is to make it, I think, a better

target for certified compilation as well as generalized form of verification across on some these other languages. And then there's also, if you go and tell us to Agora, you can find a few articles by a guy named Sanders Spies. And he has an O'Camel implementation of Walsam. And so there's a lot of discussion there. That's probably more speculative and we take a while. And it won't be, I think, Wossom as you see it in whatever, Pocod or does Nyer use, you know,

was some of these other projects that sort of are Wausum from the start. it'll probably be some kind of subset or some kind of other flavor of wasom as I understand it. So you can read about that on Telsagora. Some of the immediate features, though, that people want to add to Mickelson is definitely around readability. It's definitely about intermediate representations, et cetera, but it's also about adding things like events and the things that are really widely used in Ethereum that don't exist today in Tesos because the project was sort of launched without some of these very useful features, things that people who are doing integrations or tooling or wallets definitely want to use. So we talked a bit about the, you know, languages side of my joke. Let's talk a little bit about the application side. What are some of the sort of applications that are currently being built on Tesos?

I would break it down into a few categories. So you have sort of folks who are doing defy-ish things. And so you have things like Staker Dow. It's a Dow where folks sort of hold a, buy a security token and then can manage, govern this basket of tokens. initially they're doing one, I think, that represents a bunch of staking assets, and then later they think they're going to try it. Basically, the way I explain stickerDAO is kind of like, you can think of it like MakerDAO, but instead of just doing a stable coin, they want to do their ideas.

Let's do lots and lots of different defy applications that we govern through this Dow. But the government is token from the start as a security. They're like, let's go bigger and also will constrain the set of holders to this thing. That's actually more creating that kind of clarity around onboarding for like institutional type folks, I think is actually underrated. I think that project's really interesting. They're using actually a lot of the stuff that we've built here at TQ and other parts of the ecosystem. So they're actually, they have a fork of Tesosagora that people are going to, so imagine

if MakerDAO governance decisions were mediated in part through something like Tesla Segora. That's basically what they're doing. And then they obviously use our sort of reference implementations and token interfaces and things. So that's one interesting project. Then there's a bunch of other folks doing digital securities offerings or other kinds of digital securities projects on Tesos. And so there's a lot of work with these folks in Brazil who are like one of this very large investment bank that have been doing, they tokenized Brazilian REITs and this is a BTG Pactual. And then you have, you know, so a few other

digital securities projects like the Elevate Returns project in based out of Thailand. They're basically also tokenizing some Thai REITs. There's also this digital securities projects all around the world doing. There's folks who I think tokenizing artwork in Korea. Then you also have sort of other flavors of projects, you know, going back to the defy topic around one idea that's been open source stable coin design that Arthur Breitman, that one of the founders of Tesos has put forward is this idea of Checker, which is like kind of inspired by stable coins and MakerDAO and things like this. I think has some distinctions. And he's really, I think, more interested in. We'll see where that one goes. But I think that's

definitely something to look out for. There's also basically something very similar to Uniswap coming out pretty soon. I think that they're sort of figuring out their last steps and trying to get a smart contractor audit, but that'll be coming out soon enough. You have sort of the underpinnings of a defy ecosystem, for sure. You have sort of, you know, the, a couple assets that folks are bringing to market, some non. If you'll hear about some of these interesting ones soon. And then you'll have, you know, sort of the stable coin that are being considered. Then you'll have, you know, also obviously this, you know, swap style decks. After all that, you can start to get into things like lending or, you know, things like compound, you know, that once you have sort of the basis for

on-chain activity, especially in the defy space, then he base defy primitive, or whatever, then you sort of can extend to some of these other areas. You mentioned digital securities and that there were quite a few projects building these types of applications on Tazos. Can you give us a sense of why that is? Why do you think that there are so many of these being built here? So I'd actually back up and say, why do people want to tokenize securities on blockchains at all? So this is like a thing of people, a lot of people in the blockchain space are like very mystified by.

So that's not sexy, that's not, you know, interesting, you know, it works fine, et cetera. So, you know, the idea that we've been looking at is that actually a lot of the value prop for, say, doing this on a blockchain at all is that you can get a common infrastructure for the way assets are represented, both. in trusted and, you know, sort of lower trust environments, that scales globally. So imagine that you could basically take off the shelf software that represents, you know, sort of any kind of asset for any, you know, asset-related use case, for anywhere in the world that follows the same standards on the same, on a common platform, and basically drives the cost of this financial infrastructure down to zero. And so even if there's like, you know, the regulatory restrictions, even if there are, you know,

sort of obviously still moats around exchange and things like that in liquidity. You've just driven the friction to getting started. It's no longer around the software infrastructure. Like the software infrastructure now costs zero dollars. There's a lot of long-term benefits and innovations that can probably come out of folks onboarding all these different types of all sorts of assets using common standards all around the world. And you can think of, for example, some kind of more interconnected global markets because all these assets are standardized.

and even if there's like obviously lots of, you know, regulatory restrictions that are needed for how you ensure that people are following the appropriate local regulations and things like that. This is the foundation for building interconnected global economic, you know, infrastructure. And so if you take that long view, then you realize, you know, and that's sort of the approach of, you know, some of the, you know, the entities in the Tels ecosystem, that's that you realize that's definitely an area where we kind of want to want to participate. And so we've directed a lot of effort towards onboarding projects that want to basically eventually be on one big common economic infrastructure. And then the value prop for Tezo specifically is that it's designed with few of the scary things about existing blockchains, Tezo sort of tries to solve. So for example, obviously security of the underlying smart contracts and things like that,

that's like a core tenant of Tezos. And obviously since Tezos was first introduced, there's been a huge amount of focus on formal verification across a lot of other ecosystems, especially in response to hacks on Ethereum, et cetera. But Tezos has both that security component and then also, you know, the focus on trying to have, you know, smart contracts that are very, very correct and very, you know, correctly, you know, sort of specified and defined and have properties about them in mathematical, you know, form. you also have the governance aspect where basically if you want to tokenize something and you want to you have this life cycle over 20, 30 years, how do you know what platform is going to be around in 20, 30 years? Well, the argument is that something like Tezos has this governance mechanism so that it stays, you know, both maintains a social consensus over, you know, a very long time horizon and as well as, you know, the ability to add features to the protocol over time as

new evasion is become available. So the idea there is that imagine your, you know, your contracts remain secure on this network, but you're getting access to this self-improving economic infrastructure that's becoming faster. It's becoming more secure. It's becoming battle tested. It's becoming, it's adding functionality that, you know, it starts to accumulate all these network effects, you know, that are driven fundamentally by the improvement on the underlying infrastructure, but while maintaining the security and safety of your assets on that platform. And so that's very theoretical, but in practice, I think, like, I think it's designed with some of these kinds of, like, how do you make these kinds of theoretical advantages tangible? And that's sort of some of the

stuff that we're really interested in working on. It's like, you know, the self-improving economic infrastructure that people can tokenize their assets on safely and know that over 30 years, the infrastructure will continue to improve, but that their assets are in, and their, their applications are secure. There's sort of a long-term vision here about the longevity of Tezos, given the on-chain governance, given this sort of self-amending property of Tezos that is somehow attractive to people who want to build financial infrastructure that will outlast, let's say, the whims of those developing the project or, you know, the ecosystem or this sort of thing. Yeah, exactly.

Okay, interesting. So it's like autonomous base layer financial infrastructure for everyone in the world. that improves and continues to, but itself improves, obviously conservatively because of the way the governance mechanism is designed, but while maintaining the security of the applications and assets that are on top. So I wanted to ask you then, because you mentioned Arthur and I think he plays a role in the ecosystem in terms of pushing ideas and doing research. And what is his role now?

and I think more broadly, what is the role of the foundation as well? Kathleen as well. Because those are sort of two pillars, I guess, in the Tezos ecosystem that can't be overlooked. Absolutely. So Arthur definitely provides a lot of, I think a lot of inspiration to the folks that are building on Tezos and as well as the core development teams. So I think he contributes to the types of things that are developed at teams like Nomadic Labs or evaluate some of these ideas or even write prototype. of different ideas that he has and then hand them off. And if they're interesting or valuable, someone will try to advance them through the process.

So if you go on Tel-Sagora again, you'll find a lot of his blog posts about different ideas that he's considering. One of those is like this idea of like contract signatures or you can find him talking about, like, you know, different topics around delegation and staking and how he would improve the Tesla staking model or I think he was a contributor to the upgrade of the Telos Consensus algorithm back in the Babylon upgrade. most of his involvement is definitely around some of those areas, for sure. And then obviously, Kathleen, she's, you know, she has a gaming company called Coase.

Building on top of Tezos, they, you know, are doing, I think, Magic the Gathering on Tezos. Really, you know, folks have a lot of experience in the gaming space. And they're, you know, sort of doing trading card game based on Tezos. And then you have, going to the question on the foundation, the foundation's role is, you know, at least that it's set out for itself, is that it's a member of the community. that funds key infrastructure and public good projects. It's a different role than actually the Ethereum. I think the Ethereum Foundation plays where the Hills Foundation does not control anything like an EIP process where, you know, or anything.

And I'm not saying that Ethereum Foundation 100% controls the EIP process either. I don't, I think that's an unfair thing to say. But the way that it's set up in Ethereum is such that core development as well as standards and all these things, they kind of do flow through the Ephirum Foundation. and there's a very explicit role for both the founder of Ethereum and the Ethereum Foundation to just kind of stick around for a long time and just sort of guide things quietly. The TELES Foundation is much more of a caretaker foundation where it's participating, but it's not governing or managing the network by any means.

It's really more so of an organization that's funding key projects and then basically making sure that the money as well is not spent on bad activities. And so what areas is the foundation funding at the moment and where some of the key things that the foundation wants to focus on? Yeah, sure. So the telecommunation, you know, and I'm involved with a few of their committees and a few of their internal decision-making processes. And basically, you know, what I can say is that essentially a lot of the focus is on building as to say, like a lot of this key infrastructure from bottom to top that enables the, you know, sort of the vision that I'd describe. So the notion of this thing as currency and also as financial infrastructure, what are the things that we need to build? So, and what are things that need to get funded? So things like wallets,

things like projects that, you know, doing, you know, basically going out and finding folks who want to tokenize something interesting on Tezos and getting them to understand the value prop and then, you know, providing them also direction towards some of the tools and other public goods that are that are available for them to get started. A lot of the, you know, funding some of these. language teams, right? So a lot of some of these language teams are are obviously funded by the TELOS Foundation directly. The foundation doesn't, for example,

sit down with these language teams and say things like, you need to do the language this way or something like that. It's instead just here's the funding and then there's a technical committee that basically checks the progress of these language projects and says, okay, well, these guys have made progress

here and here, you know, and then evaluates, you know, basically should these language projects be continued or or expanded or shrunk or whatever based on the performance. Now, how you set those kinds of priorities and evaluate based on those is obviously the age-old political question. But all in all, you know, I think there's going to be a lot more focus on trying to make some of these things more transparent and obvious as to how the foundation thinks about,

you know, the folks at the foundation think about what is important, what is a priority, et cetera. One other thing I'd say, too, is a lot of the foundation decision-making processes are really sort of the output of external folks sort of in committees. There's a technical advisory committee. There's folks who also do, you know, sort of advise other kinds of tactical deployment from the foundation. But a lot of the operations, I'd say, are pretty small. So it's a very small organization. It's not like the, and I think the Ethereum Foundation at its peak had, you know, something like, what, I don't know, 150 people either contracted or employed or whatever. Health Foundation is, you know,

10 times smaller than that. So it's pretty small. But it's basically just trying to make sure that things get. They're just trying to fund things and make sure that the funding is properly spent. So, of course, another source of funding is the governance system of the chain itself. Yes. Has anyone actually received funding from that yet? Or is that still more like, you know, in theory people could be, but no one has? So there was a small invoice for Athens, the first amendment proposal. That was about 100, TES, I think. It was just a demonstration. Babylon, I don't recall actually what it was. Maybe it was a thousand, maybe there was nothing.

This current proposal cartage has nothing associated with it because it's a very small fix to a few bugs in Tezzos. This is probably something that's going to happen over the next one year or so, you know, in the next year or so. And a lot of folks are really interested. And you can see this in the recent AMA, Core Development AMA from, I think, last week or the week before that, around how do you do price discovery around these invoices in a way that? in a way that's, you know, fair. And that's where I think, so, so Gabriel from the legal team, he, he published on, in this AMA, he basically said,

he wants to see the, you know, things like prediction markets that are, you know, basically evaluating them, you know, you can kind of do the Ralph, if you guys are familiar with the Ralph Merkel mechanism for, for example, where you could, basically it's a prediction market on the satisfaction of people in a year or two years, something like that.

And in theory, you can combine things like that with other kinds of mechanisms like Arthur has published on some, you know, in his, I think he has a blog post where he talks about. If you change staking, for example, to be based on an auction mechanism, you could like basically run a prediction market. I believe it's on like the future of inflation rate rewards that people would want from auctioning off of blocks like, you know, block rights and stuff like that. Trying to build some kind of internal mechanisms around that. So that's the, a ways away, I think, that those kinds of price discovery coming up with like a really robust,

like viable price discovery mechanism for invoices is probably going to take a long time. In the short run, and I think it's Olaf Carlson Wee from Polly Chain who's made this point before. So say, for example, there's an amendment that, you know, causes Tezos to, you know, become significantly more adopted. And so say that there's a 50% increase in Tezos, you know, so I'm making up the metric, but I'm just using it for sake, for, as a time. toy example. Say that there's a increase in Teso smart contract adoption, you know, where 50% more contracts are deployed over the next year or two years or whatever. In theory, like, you don't have to provide a big relative invoice to the size of the network to fund that, you know, the changes that

could lead to such a significant increase in adoption. So what I mean by that is actually going back to the point about WhatsApp having only 19 or whatever, 16 employees, but selling for $19 billion or something like this, like you could have an invoice that funded a team of 20 or 10, or let's say of even five people, but maybe we'll use something like zero knowledge or sharding or something like that where a team of say five, 10 people worked on sharding tezos, that increases, you know, scalability by, you know, I don't know, whatever. Let's say, you know, scales by 20x or something like this. You know, the absolute amount that this invoice could represent could be very large, but the relative amount to the token holders and the bakers could be quite low.

So a half of a percent over that's like in a vesting contract over, you know, say three, four years could turn out to be something that scales the network by 20x is probably worth, you know, sort of a cost like that over four years, you know, spread out across four years, right? And when I say 4.5%, 0.5%, half a percent, I mean 0.5% of the current tokens now as like where you basically, when you do the invoice, those tokens go immediately put into a vesting contract and that inflation is known. It's not like you're minting new tokens or something like that. But, you know, there's lots of ways where you can create this really clever incentive models that are really cheap for all the stakeholders relative to the market cap or whatever, but have really significant benefits in terms

of adoption or scalability or some metric that you want to choose. Beyond just the funding, what are some of the other learnings that you guys have learned about the governance experimentation that is Tezos now almost reaching up to about two years in. First off, what is different about the current Tezos governance process that was maybe different than what was explained in the white paper? And then what's also different, has anything changed since the launch of Tezos? So basically, I have a blog post called Amending Tezos. And that blog post is sort of the output of having actually traveled to the nomadic offices in Paris, sat down with the team and said, what is actually in the code base?

And let's figure out what actually, you know, the Tesla's amendment process is, how to actually make, kick this thing off and start using it, right? Basically, you know, went there, we sat down, basically discovered that the way it was implemented

was pretty similar to what was in the white paper. And so basically what that was, right, is a, you know, this four stage process. And then it has this quorum, you know, where at the time where it's basically this mechanism that adjust based on previous, the participation in the process. So if say it's 80%, and then it has an adjustment formula that,

you know, if it was, say, above 80%, that would adjust upward weighting, you know, recent participation by 20%, and then using 80%, I think, as its basis, you know, for the rest. But so in practice, then when we went to Athens and other actual amendment processes cycles, this produced dynamic where the quorum was expanding, like going up a lot because there was massive participation in of stake. So it was something like, you know, 88% or 87% of the stake voted in the initial, you know, Athens, you know, cycles. That led to an increase of the quorum to something like 81 or 82%. So it's just sort of this paradox of the quorum where basically, and this is in the amending Tezos, it was predicted in the amending Tezos article, but basically that you would start to increase the quorum significantly

above 80%. And then because that's happening, because you're increasing it, even though you think that you're like raising the bar for the, you know, the amount of consensus that's needed to pass something. In fact, at some threshold, you actually start to, if it's not capped, that you end up giving a lot of power to say someone with a three or four percent stake to basically come in and just basically veto anything. And so you could even get through the initial stages of the process and then someone could come in with three percent or four percent of the stake and veto, you know, the execution of one of these amendment proposals. So the change that I think Cryptium Labs wrote is similar to what we had worked out in late 2018

was basically to say, let's put a cap on the quorum and a floor on the quorum. And people are like, well, lowering the quorum, that's going to make it easier to pass things and whales will have more say or whatever. In practice, it actually does the opposite because it means that, you know, a small cartel of folks or even just one large stakeholder can't just like veto everything. Having too high of a level of consensus required to make decisions actually centralizes things. That's like sort of the paradox here. You know, you see it in things like the U.S. Senate.

You see it in other places too where you just end up basically stasis favors, you know, sort of a lot of times big, big players, right? And so trying to find that sweet spot is really important. And just one more point on that, actually, that I think, you know, is worth mentioning is so somebody who actually has done a really deep amount of thought on this topic is Matan Field from Dowstack. So a lot of the conversation with him, I think, was really informative in terms of thinking of, like, long term is our quorums, like, viable, right? And so basically what he argues is that, you know, you end up with a, and he sort of has his own very generalized framework for evaluating the quality of governance decisions. But basically what he described was, like, basically, you want to be able to scale your decisions, you know, be able to handle lots of decisions. But you also want to make sure that they're representative of the larger group. And what you can end up with is with a quorum that is too high, two.

make scalable decisions and too low to be representative of global consensus or whatever. And so that's one of the things we're going to have to think about a lot. And that's where it starts to become interesting to think about alternative mechanisms as well. You know, like things like prediction markets and a few charting and stuff. Like things like Brexit, for example. Brexit, like afterwards, you know, you poll people and are like, we wish we hadn't done Brexit, right? In a lot of cases, right? And finding a way to basically have a check on these like low participants. patient or this sort of thing is definitely something that's worth exploring, you know, I think in the future.

But we haven't yet like fully thought out like how you saw that probably. Maybe I don't know if you guys in Cosmos have have thought about like any solutions to, I know you guys have a differently designed quorum system than ours. I think it's like 51%. Is that right? We just have a fix saying that like, you know, it's 51% to pass a proposal. Then one third can veto. And there needs to be at least 40% of stake voting for otherwise it gets automatically rejected. Relating to that point, you know, what are we doing in Cosmos and whatnot is Tesos was really, you know, originally one of the main value propositions was it is going to be like the governance focus like chain.

But today when we see is almost all the new chains that are launching are usually have some form of strong on-chain governance. So whether it's Cosmos or Pocod or even some of the newer chains. So how does Tesos kind of position itself in the market now? In a way, you could say that Tesos succeeded in a way where it kind of convinced the rest of the blockchain ecosystem that, hey, on-chain governance is maybe a good idea. But now, given that, what's the future of Tesos? What's the new market positioning?

So I actually would push back and say it's easy to say that you're going to do on-chain governance, you don't really need on chain governance unless you're trying to do something useful. There are certain chains out there, and I'm not going to name them, that love to talk about governance as the only thing that they do. I think those are probably all bound for irrelevance, to be frank. And I think that you only really need governance when you have something to govern. So Tesos ultimately, regardless of the governance process, is aiming to be a currency and a, you know, as a project was sort of founded to be a currency in a smart contracts platform, right? The governance process is really only useful insofar as it's in service of those kinds of goals.

And so I feel like the larger question we should be asking is, why does Tesos build a really robust social consensus? Like, why does it build the kind of moat that somebody like an Ethereum or Bitcoin has? Like, how does it get to that point? Realistically, if you can make lots of decisions really quickly, like you're probably not, you know, in most cases, you're not a really particularly interesting chain probably to begin with. because you don't have any, you know, people using the platform who want to, like, veto your changes or you don't have any, like, I'm just saying, this is a heuristic you can, you can use to think about this. And I don't know, who do you particularly have in mind?

Because I can say how I would position Tesos versus some of these different projects if you're Pocodot or Cosmos or. So Pocodot is sort of, actually, I'll use Cosmos instead because I think Cosmos and Tesla sort of follow the opposite vision. So Tesla is like, network effects probably accrued-a-one chain. Basically, we want to figure out how to have. have the most network effects of any chain. And we're going to do that like a priori, like before thinking of like the practical considerations of does anyone want to build on the thing or whatever.

And then Cosmosis thing is, you know, sort of more of like there's just certain limitations that as you try to scale socially, you just cannot get over. And so you might as well have a pretty open architecture in terms of, you know, allowing people to spin up chains. And then we're going to put all the effort into making all these different sovereign zones talk to each other. I mean, I'm over, I'm exaggerating, but it depends on what you want to be, right, when you grow up. So if you're a chain that wants to be, to be, to be, you know, sort of require a lot of network effects sort of following the Ethereum or Bitcoin model, then Tesos is, I think, actually decently positioned to that as sort of the, it has, you know, a lot of social consensus also

around that have emerged from people onboarding to do staking. So, like, even though staking is like, we're surprised at how interested everyone is in it, you know, there's sort of this sense of participation and direct engagement with the network that is accessible to anyone in the world around one chain that, you know, that kind of resembles, you know, that kind of resembles, you know, sort of how a lot of people coales around things like Bitcoin and Ethereum and whatnot. Whereas other chains like Cosmos and PocaDot are really more about like sort of running in the background, in my opinion. So like I think Cosmos is like sort of the, I mean, how many people who ever use anything that will be built on Cosmos ever like think about or ever going to have to think about. about cosmos. And hopefully that's true for a lot of, you know, most things that are built on Tesos as well. But in practice, sort of think that that's the difference in consciousness around these chains is, you know, do you want to be a chain that is like populist and like lots

of people coalesce around and like lots of people care about, et cetera, or, you know, and people want to participate in? Or do you want to be a chain that, where people just build things on top of it, it runs very much in the background? And thus, you want to focus on having some kind of architecture that is, you know, going to onboard as many different potentially conflicting folks as possible. That's a good note to end on, I think, is, you know, what will Tezos become as it grows up? Yeah. And so it's definitely an interesting ecosystem. And thanks for sharing your thoughts on, you know, how the Tezos ecosystem is evolving and we'll definitely keep following it as it continues to grow. Yeah, absolutely. Thanks for having me.

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