Epicenter - Learn about Crypto, Blockchain, Ethereum, Bitcoin and Distributed Technologies - Luis Cuende: Aragon – Decentralized Governance and the Fight for Freedom

Episode Date: May 24, 2018

Aragon Founder Luis Cuende joined us to discuss their work on building tools for decentralized governance. We covered the origins of his deep drive, why this is a crucial fight for humanity and the tools that Aragon has built. Topics covered in this episode: How Luis became an advisor to the European Commissionas as a 16-year old Why freedom and technology became Luis’ prime obsession The origin story and vision of Aragon The risk surveillance and authoritarianism pose to humanity Why decentralized governance is the key to freedom How to think about inequality and blockchain governance Why on-chain governance makes more sense on application than protocol level AragonOS and its different applications The Aragon Network Token and potential role in a decentralized court system The road to decentralizing Aragon organizationally Episode links: Aragon Network The Aragon Manifesto Decentralized organizations can solve the world’s worst problems Aragon - The fight for freedom Video Decentralizing Aragon’s development – Aragon Decentralizing Aragon’s development II: Minimum Viable Foundation Decentralizing Aragon's development III: Onboarding new teams This episode is hosted by Brian Fabian Crain. Show notes and listening options: epicenter.tv/236

This is Epicenter, Episode 236 with guest Luis Quende. This episode of Epicenter is brought to by Knosis, an open platform for businesses to create their own prediction market applications on top of the Ethereum network. They recently launched Gnosis X, a challenge inviting developers to build apps on top of the Knosis platform. To learn more, go to Epicenter.tv slash Knosus X. Hello and welcome to Epicenter, the show,

which talks about the technologies, projects, and startups driving decentralization and the global blockchain revolution. My name is Brian Fabian Crane, and I'm here today with Luis Quende. He's the CEO of Aragon I. Aragon is a very exciting project, working on decentralized governance, building decentralized organizations.

Of course, DAOs are something that everyone in the space has, or most people have some recollection off of the immature early beginnings, and now Aragon is one of those projects that really is trying to make that a viable option for the future. So thanks so much for joining us today, or me today, Louise. Yeah, thank you for inviting me. Yeah, so it's been really fascinating, reading a bit about Aragon, since I've been reading this book called The Sovereign Individual, so I'm reading it right now, and I've heard about

it quite a bit from different people in the blockchain industry, kind of mentioning, oh, this book has influenced them. And I've been reading this book, and it's so much, you know, it's almost a perfect. It talks basically about, how people can become their own sovereignty and, you know, be sort of in control of their own life much more and have cryptographic assets and organizations managed that way. And this is written in the 90s. And now Aragon is basically building that. Of course, the whole blockchain space is building much of that, but especially something like

decentralized governance. Yeah, I think it's exciting to see how these people could have predicted something like this. but I think, you know, we are building off ideas that people have been having for some time, even like the AEOs, the first idea was like 2014 or something like that, but it just takes time to actually execute and have something out that people can use. Yeah, so how did you first become interested in involved in the blockchain space? So this was 2011, and I first read about Bitcoin in 2009 via Hacker News, And when I saw it, I thought, you know, super cool, but this is like technically not possible.

So this is probably like a scam or something. And then in 2011, I read the white paper and then I was blown away. Because it gets together to the things that I like the most, which is technology and freeing humans and liberating humans. So I think it's a very powerful tool. And it was like around the whole banking crisis. it was hitting in Spain where I'm from. And so it really resonated with like what my environment needed and what I needed to be a more free individual.

Cool. And that's pretty amazing that you heard about in 2009. That's very, very early. So one of the things that, so I think you've also got some sort of title as like youngest hacker in Europe or some sort of thing like that. But then one of the things you did was. was that you were an advisor to the European Commission about technology. Of course, European Commission being kind of the main governance body of Europe. So can you share with, like, how did that

end up? And what kind of lessons or learnings did you have there that kind of shaped how are you going about Ergonne today? It was a very fun experience because I was like 16 when I got started and like I was like a 16 year old like sitting with like a lot of like people older than me and actually like the VP of the European Commission, who was like 70 years old, and she was asking me for feedback. So that was kind of amazing. And it was at the same time, it was kind of frustrated because, for example, I remember it was about that time when the cookie law passed,

and now you have this all like terrible cookie messages. Like, you know, you have to accept that the vendor, like the server is going to use cookies to track you or whatever. and I try to very strongly oppose because there are like 10 other ways you can track people but then you figure out like people in the government

they rarely know technology so something that I think it's important and important takeaway is that things move super slow and even if you had right people they probably don't know what they are talking about so something that we like I've been trying to incorporate

it to Oregon as much as possible like let's try to not rely on people who don't know what they are talking about in order to build the future. Yeah, no, I think that's a very good point. And then, of course, that reminds me of another book that I read in the last years that influenced me a lot, which was this book Commodeus, which presumably many people have read.

But there it talked a lot about how just the entire political process is becoming, you know, incapable of keeping up with things. And that sounds like a great example of it. And of course, we're seeing it a lot in the blockchain space. So then how did you end up starting Aragon? What's kind of the origin story of them? It's a complex story. So we were working on a super unrelated thing back in the day,

both Jorge and me. We were working on a startup to fight against patent roles who are these persons or companies who buy or like patent stupid stuff, like a printer, for example. and then they go and sue everyone using that patent. So there were like super crazy cases, like a guy who patented Wi-Fi, like printing over Wi-Fi,

and then went to every single small business who had a printer and was like, hey, you owe me a million dollars for using a printer. So that was very broken. And from our open source background, we tried to fix that in a way because they are heritage innovation so much. And so we went to the valley to live there

and raise some busy fans and like go the traditional startup route. And then at some point we figured out like it is really worthless. Like you cannot try to change the system without changing the rules. So like patent rolls are a huge problem and everyone knows about it. Even the government, like the US government knows that the innovators are wasting billions of dollars a year in this patent rolls. We're not creating anything new. They are not improving anything. So we figured out, you know, maybe the problem is not bad and trust.

Maybe the problem is governance is broken because we have these corporations who are constantly logging to get their interests happen versus the interests of the people, of the innovators, of actually the builders. So we have to fix the underlying thing, which is we have to fix governance. And then also around that time was when Donald Trump won the U.S. elections. And we were living in the U.S. and we were trying to get a visa. to like more permanently be there. And it was so hard because like,

visas in the US are super hard for some reason. And it's funny because it's a country made up of like, you know, like people who came all around the world to work there. But then if you want to build something, you get into like visa travel all day. So it was around the 10th and Donald Trump won it. We were just like, you know,

this is not going to be the place where things happen anymore. And it's very, very, very clear and very apparent that governance is broken at a crazy macroel. level, like the whole US had a governance failure electing this leader. So let's build something so people can coordinate easily and we can experiment with new governance methods because the traditional ones don't work anymore. Yeah. Okay.

And what made you think that it was the right time to start a project focused on governance you know, on the blockchain? I think it was a fact that like humankind needs it so much. I think Donald Trump was, I think Donald Trump is like, you know, bad for America, but on the other hand, it's so good for crypto because it is the perfect case. Like, you know, we have to hurry up. We are, we are confronting a lot of dystopian futures that could happen and a lot of, like, super dystopian societies and leaders that are being elected and very radical leaders.

And so we have to, you know, to stand up and fight for it. So, you know, these things think a lot of time. maybe for the iOS to be usable by the mainstream, it will be a couple of years. We need to develop so much technology in this tag, you know, for the blockchain itself to actually make it user-friendly for people to use it. So, you know, it was the right time

because Ethereum was working and out there and you could make a smart contract and the world desperately needs it. So you mentioned before the call that there's also a background story behind, you know, the word or the name, Aragon. What's that story? Yeah, so basically there is this small region in, well, not that small, in Spain called Aragon.

And basically, like, no one knows about this because winners get to write history, but there was a period of, like, six years in this region where it was pure anarchism. And it worked. And this was before the internet, even. And it worked beautiful. was like a small community organizing between themselves in a totally free way. But then, you know, the

sort of like estate guys came in and killed everyone and so it was like forgotten forever and only like in some books here and there. But it's a fact that these societies can exist and they can be guest and they can work. We just have to nurture them and make them something appealing to people. But they have assisted before,

even before the internet. So now that we have the internet, we can recreate them and they will be much more powerful. That world, the way Aragon or Aragon worked back then, what do you like about it? What works well? I think there is a lot of, there was a lot of empathy there because when you have to organize with a small group of people, you can know what the problems are. You can do, you can communicate better versus having like a 50 or 500 million own country where it's very hard to emphasize with people from all around the country. They have different problems, different incentives. So I think that worked out very well.

And then like making everything as opting as possible, which I think it's a side effect of decentralization of power. I think that's very powerful. And that makes humans fully realize their creativity and their freedom. And, you know, they make them feel like they have succeeded in life versus just having so very hierarchical system telling you what to do, which is what happened then after anarchism was due in in Argonne. Cool.

So one of the things I was reading, preparing for this episode, was the manifesto. So you guys wrote a manifesto. And in there, one of the phrases is so that without a global conscious and concerted effort, the outlook is incredibly bleak. So kind of talking about, you know, what's ahead for the human race. So what is this thing that, you know, what are you afraid of? Like, what do you think that trajectory is that is so scary? I think in the everyday, we get used to stuff

because, like, you know, we live in day to day and the changes in day to day today may not seem very significant. But when you look back, like 40 years ago, and you think about, you know, tax systems or you think about how we used to pay, you know, like tax systems, they were not that efficient. Like right now, there are countries in the world in which their most powerful supercomputers are just working for the tax system.

And they are just working with, like, you know, cameras in the street that are recognizing people for, you know, terrorism. And then you have the NSA, of course, and you have all of these programs trained to spy on citizens because they want to prevent, again, terrorism. And then you have facts about, you know, who is actually causing this terrorism for what actual reasons

and why are the incentives to do so? And so you discover a lot of these stuff and it looks like a black mirror episode. Like there are some black mirror episodes that I think are happening in reality. Like for example, China is starting to incorporate this sort of minority report, you know, prediction of criminal activities

to even, you know, maybe in the future incarcerate people before they have even committed a crime. So that's terrible and that's the use of technology. that humanity is doing. And technology shouldn't be used for that, to actually liberate ourselves. If you look at like 40 years ago, people were helpful about technology.

They were like, yeah, you know, machines will work for us. They will liberate us. We will be able to focus more on creativity and stuff like that. And then we're having the exact opposite direction. We are being spied upon. We are being oppressed. And we've been working more hours than, you know,

other generations. And so, and we are enslaved by debt. stuff like that. So I think that is the future that we want to avoid at all costs. Yeah. So really that surveillance, totalitarian surveillance state, which of course you're completely right. It is the trajectory is so obvious and it's kind of amazing how people don't, you know, don't stand out. One example that always strikes me so much is in London, right, if you're on the, if you're on the tube, then they keep having these announcements.

It's like, you know, if you see anything suspicious, you know, report it immediately and then see it, say it's sorted or something like that. And it's exactly like some sort of Orvellian tyranny, but people just get used to it. Yeah. So in this quote, of course, the second thing, right? So this is bleak thing and then says, okay, but what's needed is a global conscious and conservative.

concerted effort. What does that look like? I think it just looks like the like a theory community, for example. It's very like on one hand, it's very chaotic and it's very organic. But on the other hand, we sort of agree that we serve some values and we work together to achieve those values. In our case, we're trying to actually describe those values in the manifesto very well. So we all know that we are in the same page. Because if not down the road, if you don't prepare the systems to be or, or these communities to be that way, then you end up having stuff like Bitcoin in which people resort to like some phrases in the white paper and they are like, oh, Saddosis Fission or stuff

like that. And then you have like religions. Well, also do the same. Like they look at these books and they, you know, they try to make stuff very subjective. So we're trying to be like super objective on our values in order to have everyone on the same page. And once you have everyone on the same page regarding values is just how do you arrive to those values. And that's okay. for it to be in multiple ways because that's basically I think that's healthy and you have to try multiple paths

until you arrive to it. But I think it's very important to have a list of values that your community agrees with. So if you think of this on a global perspective, so we have this threat of this surveillance state and this totalitarian all powerful governments.

And now you say, okay, the way against it is having communities around values. So you think the sort of call to the world is to spend more time figuring out, you know, what exactly are those values and then building these technology and communities around it? Yeah, probably. If you look at like society these days, it's hard to define values right now or everything

that makes society helpful at all. And that's a tool that is, you know, these entities use against citizens. Like, you know, they are scared by terrorism and other, you know, other. threats and they are not helpful anymore and they don't serve the values. So we have to make sure that we are not only sipping code, but we are doing something meaningful. Cool. So there's, there's one blog post that you guys wrote, which is sort of, you know, why, what is the big thing that Aragon and Decentralist governance can solve? And then you tell this story of this fictional person in Venezuela. Do you mind walking through that story? I thought it was a nice example of, you

kind of the Aragon vision. Sure. So the story talks about a fictional character called Maria, and Maria is a 16-year-old, I don't know if so 16 or 12,000 like that. Well, it's just like a super young girl in Venezuela who started to code and contribute to open source, and she wants to make a living out of it and take her family out of poverty. But then she struggles to do so because there are multiple barriers. to that there's a lot of corruption in his home country.

There's a lot of discrimination, of course, because she's a woman. And she just struggles to do this like the other traditional system. There is no ways you can create a company. There's a lot of corruption. It would take months to do so. And then she wants to coordinate with some other open source contributors from another country. And it's impossible to do so because the system is architected in a way

that you cannot easily collaborate with other people around the world. And so what she does is just starting like a decentralized organization in a kind of pseudonymous way. So no one knows like her gender at all because, you know, it doesn't matter. You are just like an theory mattress. And she collaborates with a co-founder, Cement Online. And they start like a small, like free software consultancy. And they make some money out of it. And they make some crypto.

And eventually is able to take her family out of poverty. And this is a kind of use case that I would love to see. Obviously, we are not ready now because we need to make things usable. And we need to make sure that, you know, everything scales. And people are usually, like, able to kind of make use of these products day to day. But this is like a use case that we really, really, really feel very, very, very positive about. And I could bring a lot of food to the world. So you mentioned before that even when you are young and there's this European Commission thing,

and like, you know, what interested you or what interested you about Bitcoin was, you know, technology and freedom, where does this, you know, obsession or focus on freedom come from for you? Like, when did that start? Well, the story about Maria is actually not fictional. It's me. I wasn't born in Venezuela, but I come from a humble family in Spain. And I had a lot of trouble starting up and creating something. and, you know, I kind of feel discriminated sometimes

because I was not like a Stanford or Harvard person. I was born in as mobility in Spain. And I got to say when I was 12 years old, so there was also like a lot of age discrimination back in the day from people from my own country. So, and also, like, my family had a lot of trouble with the banks. So I think it all comes down to we need to create tools for freedom because freedom can make your life easier

and make you be happier and not work 40 years of your life to just pay staff to banks and governments. And I think that's very powerful and that's very important because we need to live in a world in which humanity matters and we're just not animals

obeying orders from above. Cool. That's very interesting. I didn't realize that this was based on you, but that makes a lot of sense. So the commitment right from the Aragon is to build governance systems it says right that kind of align with with its values can you talk about what are you know explicitly the values that shape the Aragon project sure so first of all is like freedom or where we define us self-sovereignty

basically it defines that you are always you can always make a choice and that choice can be either to participate in systems like you know in the existing governance mechanisms or in your organizations or like in the protocols or, you know, crypto assets or whatever it is that you like, or you can exit, you can fork it, which is one of the principles of like all the blockchain world. If you like it good, if not, you can fork it. Then there is like this strong focus on privacy, which I think is wonderful because it can really erase violence. If you focus on privacy so much, it is totally impossible to have violence. So we're trying to avoid that at all costs. If you look at a lot of things that are

happening today, they are happening because some entities can actually exercise violence. That shouldn't be possible in the first place. And that's what also crypto is bringing us. And another value is decentralization itself. Like if you look at governance, like even if we build these very cool blockchain systems, there shouldn't be like an address that has control over the parameters of the protocol or, you know, over the updates of the protocol or even over the governance mechanism the protocol uses itself, it should be totally decentralized. So even if it's slower to change, it should be something that you can opt in and that you reach consensus about. Then obviously, like, we are trying to do something that creates

some long-term value. We're trying to do something that can encourage participants. They can incentivize participants in the community to actually be rewarded. because we believe that values by itself are powerful, but you have to fuel them in some way. So creating also sort of like long-term economic values, very important. And also very important is to avoid creating certain property, which is something that people are very worried about in the governance space. Like, you know, you give tokens to your community

and then devote to use like withdraw the fans and go away. So we have to build systems that actually encourage the creation of long-term value versus just like bump and dump schemes. And finally, it's just like making it very, very, very user-friendly and very easy for users to adopt the systems. Because otherwise, it's going to be like a crypto elite who benefits about this. And it shouldn't be that way. It should just be something that is different from everything that we had passed, which was

like oligarchies and these elites governing everyone. So we have to actually make sure this time is different. Cool. So do you feel like the current efforts, building governance system in the blockchain space, do you feel like generally conform to these principles or can you name some specific examples where you feel like, okay, the way they're doing it, you know, this isn't the way we would do it, you know, because of, you know, one particular value that may not get, you know, implemented or expressed in that system.

Yeah, I think sometimes some of the systems I'm seeing out there, like do a stack. that is not adequate for that doesn't resort to the principle of like opting in for example you have a crypto protocol that is automatically pushing out updates for the like smart contract systems or stuff like that I think that's actually that actually breaks the opt-in value because you're basically changing how the game works or changing how things behave like when you add in the smart contracts it's not just that you are updating your web app or stuff like that in a server. You are changing the rules of the game. You're changing a social contract between

multiple parties. So that's something that I would love to see more like opting updates in this space. And also I think there are some protocols that should benefit from like more upgradeability like or governance process. Like for example, Bitcoin is super, super frigid and something like maybe some signaling like, you know, our stakeholders may want this feature. So let's do it. Yeah. So I'm curious here. So you mentioned that one of the things that you see issues with is if this auto upgrade, does that apply, you know, for example, Tasos, right, wants to have that you have on-chain governance and then automatically a protocol gets upgraded or I think Pocador, like I think various projects kind of pursue that direction. So do you think that is not the right direction, but

or like how do you view that particular issue? I think you have to be like extremely careful and very neutral. Like if you push out updates, should be like a long governance process for people to decide if they want to opt out or if they want to opt in. Like it should be kind of an opt-in process. So what I really like is like I don't have anything against like for example on-chain governance or like governance in general. I think it's, I mean, we're building in Arrigo because we're building in governance. But I think you have to just be very, very careful because there's a huge difference between pushing out an update and then everyone being automatically updated to the new version.

and actually say, hey, this is a new version. Do you want to update? And then the user saying, yes, I want to update. Because that's consensus. So I think we should try to build systems in which they are fully opti and the user is always in control. But then would that also mean that you should actually try to build systems that make it easy for chains to fork?

Because, you know, let's say there is a particular upgrade and now 60% of a particular community says we want this, I'm on the 40% that don't want it. So do you think we should make it easy for those 40% to go their own way? Or is that something that will actually be bad for communities because it will destroy network effects? Yeah, I don't think a chain fork means a community fork. Like, I think we are going to see at some point a fork in Ethereum that, for example, is not a community fork. We still have the same developers around the same tools, but we just have two different chains.

And I think that's not be wonderful. I think right now, if it happened right now, it would be terrible. Like, I couldn't even know. I mean, we have some, like, emergency procedures in place in case that happens for the token and all of that. But it would be super bad for the Holocaust system. Like, what do you do if, for example, die, your die forks, what happens to your collateral, what happens to all of that? But right now, it would be bad. But I think in the long term, we need to figure out this system.

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go to epicenter.tv slash Knosas X. We'd like to thank Knosis for their support of Epicenter. So Vitalik and you're speaking about governance, so Vitalik and Flat both have been very vocal about being against on-chain governance. I think there's a variety of reasons there, but certainly one of the, maybe the first ones, is that they think it could lead to us some plutocracy or be unfair if Bitcoin holders basically control those systems. What's your view on maybe their criticism and the criticisms of on-chain governance in general? Yeah, it's a great question. We were at this event that we helped co-organize in Toronto called EIP Zero,

which kind of was about, you know, how do we make sure to document a governance process for Ethereum? and like, you know, gather signals from different stakeholders about what the community wants, what the miners want, what the doubt developers want and stuff like that. And Vlad was there. And we talked a lot about how blockchain should be and how do you make sure that people participate. And I think on-chain governance is a very interesting, you know, topic.

But on the other hand, a lot of these blockchains should be very neutral. I really like to quote Luke from our team who says that you can build democracy on anarchy, but you kind of build anarchy on democracy. So basically that means that if you have a very subjective blockchain base, you may not be able to do everything, whereas in Ethereum right now it's super neutral. You do whatever you want, and you have some certainty that, you know, whatever you do is going to be okay, no one is going to censor you or fork you away. And I think that's a very interesting property of blockchings.

This would be very immutable and very neutral. And then you can be all the staff on layer two. So that's my kind of stance on chain governance. I think it should be cool to have some way for people to signal new updates and the user could click, yeah, I'm in or no, I want a fork out. But it shouldn't be sort of like this very automatic thing. Or if it is, we have to make sure that there is a super long governance process for it to happen. Because otherwise, also you can end up with like prudocracy

and people just, you know, like two or three token holders, to control the whole thing very, very easily. Okay, this is fascinating. I did not expect this answer. So basically, because you are building on-chain governance systems, right? But then your stance is sort of for the actual, the layer on which all of those systems run, you know, in particular Ethereum, will be one of them. That for that, maybe you don't want on-chain governance, but you would like to have a more

anarchic system that's, you know, very slowly change. not very opinionated, but then that provides a great sort of ground on which to grow, you know, opinionated governance, decentralized organizations. Yeah, exactly. Okay, great. That's very interesting. But what about this general issue of blockchain governance and plutocracy or blockchain governance and sort of the power of, you know, the big coin holder or big.

token holder because that will also apply right to to pick particular applications that just run on Ethereum even if the underlying layer you know doesn't have uh coin voting driven governance yeah i think uh yeah that there still applies for like smart contract driven governance and right now i think the best the best governance mechanism we have is one token one vote um that may change uh we may have things that don't require any voting at all like prediction markets and then you just bet on outcomes and you really put your money where your mouth is, which I think is very powerful. Then you have systems like quadratic voting, or even if we figure out civil resistance, you may have one person who won't vote. I think until there,

until we are there, I think one person, one token, one vote, sorry, I think it's a, it's a good system in the sense that literally the people that have more stake inside the system get to decide more how it works. But we have to make sure there is like a good distribution of tokens. And how do you do that? That's another thing. Like I believe a lot of the token sales these days are having a lot of whales come in and like eat like 10%, 20% of a token supply at once. And I don't think that's good to start. I think if you look at stuff like like Bitcoin, it is pretty centralized. But it kind of organically, you know, centralized. So I think we have to make sure that we both favor users in the beginning and we have so a way to like,

you know, mint new tokens and like sort of reward users who are being active and participants for having active because that way you both solve the problem of like having a token set and having whales it in and also like stop being centralized over time by just the early adopters. And I think the early adopters should be very favored by the system. But on the other hand, you also want to like, you know, involve. more parties. And I think we are like in the Bitcoin community. I think we have a fear of like inflation and like, you know, I got to settle with Bitcoin. So I'm kind of fearful of inflation too. Like yeah, bad, terrible. But on the other hand, I think it's a very powerful tool that you use it

the correct way. I mean, the question of inequality in blockchain is interesting, right? And, you know, for example, in this sovereign individual book, one of the things they talk about is that, okay, once you have crypto assets, then those can't be confiscated or much harder to confiscate. And of course, one of the primary entities that confiscate assets today is governance and, you know, they tax and then they, you know, use that in different ways. Some redistribution is a factor, though, right? And generally, taxation is progressive. Now we're building with blockchains, all kinds of systems, right, where you have assets

that can be confiscated, which may have lots of. of great aspects, right? Let's say if you're in Venezuela and people can protect your asset from a crop government, that seems like probably everyone would agree that's a good thing. But at the same time, it could also lead to this aspect that you don't actually have this redistribution anymore from the wealthiest to the masses. Is that something that concerns you? Do you mean basically the fact that you may not have near redistribution to the masses, but just like huge inequality in the short term? Yeah, yeah.

Yeah. I think that will happen for sure. Like it's like huge revolution that happened. It favored a new sort of elite in the short term. And I think right now it's very clear that that's been the crypto elite. Like, you know, if you are into crypto for more like on a year or like two years and you bought tokens, like you probably made a lot of money and I think that's

hard to prevent because like the system and every single revolution actually encourages and rewards the early adopters like you know in the blockchain industry like the reward has always been to the first mover whereas another industry is different so I think

the best we can do right now is to acknowledge that know that in the certain the blockchain is going to create a big inequality and it's going to create like this new crypto elite know it and set systems in place so that doesn't last more than a few years until we are able to teach the rest of the world how to leverage these technologies.

Because when they learn how to do it, there is not going to be inequality because information is going to be all spread out and everyone will be able to access to these tools. So we have to focus a lot on user experience and documentation. So a couple of years from now, my mom can come in, open Oregon and create an organization like an affiliate developer very good to today.

But do you think that's actually a likely outcome? Because personally, my feeling is that the complexity of this technology in this industry is growing at such a rapid rate that most, there's just no way for the mass, sort of the normal person to participate. We've been working on this seems like day wide just making sure. Actually, like we didn't even start. with like, you know, creating a smart contrast. We have started with like a mockup of how the product would be

and then like a sort of an interface and then we need to do it together. But we are super dux focused. And I think it's a hard task, of course. But if we invest resources, like there's a lot of smart people in this space and we can make it possible. I think we need so many designers in this space right now. Cool.

Well, let's speak a bit about Aragon sort of as a project and the technology actually building, can you run us through, what are some of the main components of Aragon and how do they work? Sure. So for the whole architecture, we have a few components.

One of them is basically the smart contract system that makes everything work. It's called Aragon OS. And what Aragon OS gives you is upgradeability and governance by default. So basically, by creating a smart contract that is an Aragon app,

where you get is if you publish a new version of the smart contract, or it's front-end, for example, you can automatically switch versions. So basically you have this what is called a proxy. So basically you have like this address in Ethereum that doesn't change, and you can always say, hey, this is the voting app or this is the finance app. And then that proxy basically gets calls from the outside of the world and delegates that to where the actual code of the app is. So that makes things upgradable.

And also that makes possible to have systems that are permissioned in the sense that learning the system of private blockchings, permission in the sense that you can have like multiple functionalities in your app. And you can only access them if you have permission to do so. Like for example, you can think about a finance app. A finance app may have a method to withdraw funds. And then you don't want your average user to be able to withdraw funds. but you may want your, you know, voting app or governance mechanism to be able to move funds around. So what you do is instead of hard coding a governance system that can withdraw funds,

what you do is you say, okay, I'm going to moderate this out, is the finance app. I'm going to give permission to this voting app to withdraw funds from this finance app. And then I'm going to have like a token manager app, which basically forwards any accident that a token holders want. to this voting app. And so I'm a token holder. I go to the interface. I try to withdraw funds. And it tells me, hey, you cannot do this directly.

But if you submit a voting to the system and the voting passes, you can fulfill your action, your intent to withdraw funds. So it's kind of permission escalation in systems like, you know, in Unix or Linux. So what this makes is you can totally abstract your logic and your app from everything else. like your governance mechanism, your upgrade system, and you can focus on building like very small modules that do simple things very well, and then linking that with different apps. Like for example, right now in Oregon, we have the token manager app, which lets you assign a mint tokens. We have the voting app, which is a very simple, simple democracy app. And then also like the finance app, which is basically like a vault unless you like withdraw, you know, with different thresholds.

So you can really get granular and create very complex governance mechanisms. And so then is the idea also that there will be some sort of, I don't know, app store or things where people can build their own extensions and their own versions of these different applications? Yeah, we just released yesterday a developer portal that is hack.aragon.org. And it makes it super, super easy to develop apps on the Goveragon. like even using the like the governance framework for smart contracts or using also the UI. You can either use one or both. And it makes it super, super easy. And the idea is that we will not work on creating a lot of features.

We will just work on like setting this open source thing that you can use. This open source stack that you can use to create organization with code. And then people will create apps to satisfy their needs. Now there's also an arrogant network token. And what's the role of the token? Yeah, so early in the day, we were like, okay, this DAL thing is cool, but, and the smart contracts and all, but how is this going to work? Because, you know, human server is subtle.

Like, you can encode a lot of things into smart contracts, but there are things that are never going to be able to be written into code, probably. Or even feasible to execute in the Ethereum virtual machine with all the limitations it has. So we are right to the conclusion that something, like a jurisdiction is still very needed. So if you look at what governments provide you, they provide you security that, you know, if someone breaks the law, you will be able to render them accountable. So we're trying to do the same without being in any sort of like jurisdiction, like traditional jurisdiction. We're trying to build a new one where blockchain

organizations are native. Like it's their, it's their jurisdiction. And you can basically create agreements between each party. And part of the agreement can be power by a smart contract. Like, for example, if you want to do payroll, the payroll can be executed by a smart contract. And there is no possible dispute in that because it is what it is. It is the code and that's it. But then you can also define that human readable terms. And you can agree to that. And those terms can be more subtle. Like, you know, you will have to return your computer once you end up working for the company or stuff like that. And then you can have a court who can gather the evidence and can basically decide who's growing and who's right and they can take your collateral.

So it's fully like limited liability. They cannot go to your home and, you know, kidnap you because there is no way. It's basically pseudonymous by default and even anonymous in the future, but they can withdraw your collateral that you define. So you always know what is with liability and what is your insurance when you interact with other party. So the idea is if I understand this correctly. So you'll have various different Aragon organizations and, you know, there'll be different contracts and sort of agreements between them. Some of them, you know, may have some ambiguity. And then there will be an arbitration system. And the idea of the Aragon network token is that it can be used sort of as a collateral to back these agreements. Is that correct? Yeah, exactly. That's the

And then also the network itself will have like a constitution, which will be very, try to be very neutral on theme, but like respect things such as human rights and stuff like that. And it will be able to also use a token for governance of how this jurisdiction will work. So the one thing that comes to my mind when I hear about this, this court system. So let's say I want a company or this arrogant organization. I mean, I have various contracts with different parties. Now, to collateralize all of, I mean, if you look at the real economy, people enter all kinds of contracts, but they don't generally put up collateral. You know, that will then be available if some party defaults or misbehaves.

Now, if you have to do that, you know, for all kinds of contracts, you have to put on-chain collateral back. That seems like an extremely expensive process. Yeah, I think it is a problem that all sort of staking systems have. And what I're trying to do is we're trying to engineer it in a way that you can just put like a collateral for multiple agreements. But of course, even if you do that, there may be people that cannot go into agreements because they don't have collateral. So I think this is kind of common to all like, you know, staking systems. And I'm very sad about fair like loans. there are a couple of progress working on that

like Dharma or Bloom and I think it should be super important for us as a community to figure out how that works because I mean, staking is wonderful but on the other hand we have to make sure that people kind of stake in the first place to participate to the marketplace.

So yeah, it's something that we are looking at but I think we should figure it out as an industry. Yeah, yeah. No, I agree. So that would be a very interesting system to emerge. So down the line, right, that someday maybe you can just have this on-trained governance organization and, you know, purely in crypto and interacting with all the crypto companies. But today, most companies will still need to have, even if they're crypto-focused, right,

they'll need to have some interaction with, you know, non-crypto entities or they may actually need a legal entity in particular country. So how is Aragon going to integrate? with that. Are you also building tools to enable that? We're not exactly building the torso cells, but what we are doing is we have this grants program, which is primarily for technical implementations and research, but we're also trying to fund legal research. Like there are some countries in jurisdictions and lawyers who are trying to see how to make the AOs like recognize as legal entities in different countries. So we're trying to fund that research. Because I believe that at some point,

there will be like templates that you can use. Like right now in Oregon, when you created like an organization, you have like some templates you can use. Like right now we have a token project with democracy, token project with a move to seek. But you may also have like, I don't know, like LLC startup or stuff like that, which automatically like, you know, gets all the info for the blockchain and creates like all the PDFs for lawyers to just file their stuff.

So that's something that we are not doing ourselves, but it's perfectly doable and perfectly possible. And we're trying to talk with regulators here and there to figure out how open they are. And some countries are very, very open to this concept. Like Switzerland, for example, I think they are super open to the concept of, you know, let's make Taoist something that can interact with the traditional world. Cool. I think that does lead us to kind of another interesting topic,

which is sort of the state of Aragon as an organization overall. And in particular, you guys move to Zürger. recently. Can you talk a little bit about, like what drove that decision and what is the organizational structure of Aragon today? So right now we have this foundation in Estonia and we're trying to transition that to us is sort of non-profit. So the idea since the beginning was to split off like the entity that is the non-profit and it's basically maintaining the project until we can fully decentralize it because the idea is that the Arakord network will be the one that decides the future of the project in the community, the Arabian community, will be able to

basically directly control its future. But until we are there, because obviously we need decentralized organizations to work before making that possible. So before we are there, we have like this non-profit entity, which is the legal entity responsible of the project. And then we use a split off a different entity, which is a company. And this for-profit company is just the first team that was employed by the foundation, but now is a different entity. There is some why, we are trying to do this split, a very clear split, is because we want more teams to work on the project. And the idea is that the foundation will give grants to these different teams, both in Ether and A&T. And these projects will have, like these teams will have a very strong

commitment to the network and to the project. And, you know, the idea is that we are not only being the only, like, team working in an argument, but many other teams. And this decentralized development a lot, we're trying to think about the, the bass factor, like what happens if we get hit by a bus, like all of us at once. And one of the goals we have this year is that at the end of the year, if that happens, just like the project would be

okay because we have contributors, we have all our things working on it. So that's the idea that we have. And Switzerland has just been like an extremely welcoming place to have the legal entity. And we have like a very close connection with the government here. They speak

crypto, like everyone here speaks crypto, which is unbelievable. And something that I like about the website of Suc is that they say that taxpayers are considered as clients and not debtors. And that's something that I fully serve. Yeah, yeah.

No, it's true. I mean, I am from Switzerland originally and I agree that there's a there's like a healthier relationship between citizens and government than in many other countries. Yeah.

So how far are you? along there is currently, you know, for example, if there's the foundation board of the Space Foundation, is this still controlled by, you know, you guys who are the same people running Aragon 1, or do you already have you managed to kind of get a broader community control of the foundation or, and how is the process coming along with having other companies also being contractors to the foundation? Yeah, right now we are sort of like, you're starting to split. So, So at the end, like right now, the head of the foundation on the head of like Aragon, which is the first development company working on Aragon is the same.

So in the end it's kind of the same. But we're trying to figure out how to, like what are the next steps. We are talking to a couple of teams that are very interested in being an Aragon team, teams that are part of the space and they are very well known. And that's really great. I think we have all the right things in place. we just need to like work to make sure that communication works. Because I mean, when you have like three or four teams,

you have to properly communicate to everyone and share the roadmap and sort of work together and not to re-implement the same stuff. And I don't think this has been, this has been done a lot of times before. So we're trying to be used very, very careful and move very, very slow in that process. The next thing that I would love to see from the foundation point of view is that we start giving token holders control over some part of the funds. And also something that we want to do in the Sorter is release a signaling app. So AMT holders can just signal their intent and like basically say, hey, I want to propose this thing.

Do the AMT holders agree with it or not? And that's not going to be binding by itself, but it's going to create pressure. Like if token holders want the foundation to do something and they do a signaling voting and it has like 90% support, then that's a lot of pressure. So we're trying to take it a step-by-step and also to keep the community on how to do governance because that's something that is super important to do in the Sorter because decentralized governance is such a new thing.

Oh, fantastic. So what are some of the community initiatives that exist today? So we had a couple of proposals when actually by Alex van de Sande from the Ethereum Foundation about that we're recorded. system, like something like technical. Then there is a proposal more about like fans and how so we manage the funds. And but right now we don't have any signaling mechanism in places like a GitHub repo in which people can like submit the proposals. But with this signal and mechanism we want people to like, it's basically make a lot of different proposals.

Because I've until now it's just been like a GitHub repo and there has been like, I don't know, like 10 proposals or so, but very, very technical and very like product oriented. but we want to see more like sort of mission-oriented proposals and strategic sort of proposals. So I think that's what the signaling app will give us when we release it to the mainnet. Oh, that sounds great. Well, what about the roadmap? So what's coming up for Aragon in the next six months to a few years?

Well, in the Sartre, I can say that we are close to Mainnet, very close and also we are close as I said to releasing A&T signaling and that's a very important step to like decentralize the governance of the project we are close to also boarding more themes to like reduce the bass factor

and make sure that whatever happens the project is going to be okay from the product perspective we want to make sure we properly document everything because we have so much technology that we have created that no one knows about it because we have been a very poor job communicating that. So we just released the developer portal in hack.ri.org. And we want to keep

sort of documenting stuff. Like we have like a package manager, as I said before, which handles smart contracts and front and updates automatically. We have a way to describe Ethereum transactions in a human readable way. So we want to like modularize this components there is more, document them, and give them away to the community, and even give grants to people to maintain them. because that's something that we want to do more and more like giving grants. We just announce the first batch of our grants program and we will try to get like five projects with grants each quarter or so and we will try to continue that.

And also working on the Aragon network. Like after Aragon is on the main net and it's working, we want to focus on releasing the network sometime this year, like some early version. And also we are releasing as a conversion of the white paper, which is way, way, way better than the first version in the upcoming weeks. Cool, fantastic. And so if people want to get involved, what's the best way to start participating

and contributing to Aragon? We have Aragon.chat in which you can jump in and chat with everywhere in the community. Also our GitHub organization, which is just Aragon. And if you are a developer, you can go to hack.Aregon.org and, you know, basically start hacking. Cool. Well, thanks so much, Louise. It was super interesting to learn a bit more about Aragon. And I think the decentralized governance space is for sure one of the most exciting things to come out of all of this blockchain revolution. So I can't wait to see, you know, actual organizations being run on Aragon. Absolutely. I cannot wait either. And thanks for having me.

Cool. And thanks so much for a listener for once again joining. So we put out new episodes of episodes of every week, you can get the podcast, the audio content, any podcast application on iTunes, or you can get the video also on YouTube.com slash Epicenter Bitcoin. If you want to support the show, you can leave us an iTunes review that helps new people find the show, or you can also live with a donation and the tape patterns are in the show notes. Thanks so much and look forward to being back next to you.