Unchained - The Chopping Block: A Network State in 10 Years? Balaji Srinivasan Says Yes - Ep. 379

Episode Date: July 31, 2022

Welcome to The Chopping Block! Crypto insiders Haseeb Qureshi, Tom Schmidt, and Tarun Chitra chop it up about the latest news in the digital asset industry. In this episode, Balaji Srinivasan discusses his latest book, “The Network State, how different digital tools like crypto will help empower network states, and analyzes how crypto fits into the current political environment.    Show topics: why Balaji wrote a book and why he is so enthralled with a digitized future what a “network state” is, and what components of crypto are embedded into the idea why Balaji is interested in “re-centralization” why Balaji believes that networks states need to be recognized by real nations what makes a network state better than a physical nation or digital community why Balaji thinks a community of people who eat a keto diet could be the first network state why Balaji thinks the network states will be a good thing where Bitcoin maximalism fits into the left vs. right political divide, woke culture, and Christianity what the overlap between politics and crypto will be going forward what is the best way to learn, read, and debate “The Network State” where crypto tools and communities have gone wrong so far and how the industry can improve going forward what lessons Balaji learned from the tech bubble in the early 2000s what Balaji’s over-under is for when the first network state will arrive Balaji’s pitch for a 50:50 BTC/ETH portfolio (note: not investment advice)   Hosts Haseeb Qureshi, managing partner at Dragonfly Capital https://twitter.com/hosseeb Tom Schmidt, general partner at Dragonfly Capital https://twitter.com/tomhschmidt Tarun Chitra, managing partner at Robot Ventures https://twitter.com/tarunchitra  Robert Leshner, founder of Compound  https://twitter.com/rleshner    Guest: Balaji Srinivasan Twitter: https://twitter.com/balajis    Episode Links   The Network State ​​https://thenetworkstate.com/    Technological Revolutions and Financial Capital https://www.amazon.com/Technological-Revolutions-Financial-Capital-Dynamics/dp/1843763311    Learn more about your ad choices. Visit megaphone.fm/adchoices

Not a dividend. It's a tale of two Kwan. Now, your losses are on someone else's balance. Generally speaking, air drops are kind of pointless anyways. Unnamed the trading firms who are very involved. D5.Eat is the ultimate pump. DFIPy protocols are the antidote to this problem. All right.

Hello, everybody. Welcome to the chopping block. Every couple weeks, the four of us get together and give the industry insider perspective on the crypto topics of the day. We've got a special guest for this today. Let me start with intros. So first, we've got Tom, the DFI Maven and master of memes. Next up, there's Robert, the Crypto Connoisseur, and Captain of Compound.

Then we've got Tarun, the Gigabrain and Grand Puba at Gauntlet. And our special guest today, we've got Bologi Srinivasin, the Bitcoin Brainiac. And then myself, I'm a sieve the head-hite man at Dragonfly. So I just want to say the four of us are early-stage investors in crypto, but I want to caveat that nothing we say here is investment advice, legal advice, or, for that matter, political advice. Bobology, welcome to the show. It's been a while since I wanted to get you on here. but you told me the first time I invited you that you were busy writing a book and that you

didn't want to deal with any media. I think it was July 4th that you finally released the book, right? Yeah, that's right. Yep. And how has that experience been now coming up for air after getting a book out? I know that that's probably a harrowing experience to get all the way to the finish line. How does it feel to be on the other side? Yeah, no, it's good. Well, I mean, the thing is I kind of, I think of it is V1. Like I think of this. Like normally, it's, like an app is considered very dynamic and a book is considered static and it shipped. And I think there are multiple editions, second edition, and third edition, et cetera. So in the same way, I think of this as V1 of this book app.

And I'm, you know, planning on shipping actually much more. I may have 50% left or right, frankly, in some ways. So, and, you know, as I was discussing with you, taking a little bit of a distance from it, then coming back and rereading it and processing some of the early feedback and so and so forth, It's very helpful because I'm going to factor it into like a problem and solution kind of like a reframe and add way more flesh on the bones of certain things. But yeah, it's good. It's good. I think the reception has been quite good.

I think network state, if you just query that in quotes, network state on Twitter, has achieved mimetic inception, so to speak. I think, you know, like it's out there. People are kind of thinking of this as a concept to note something that people have talked about for a long time. So I think it's kind of right time, right place. You know, this is honestly what I think all of this crazy D5 machinery will fund. This is the actual, like, productive asset at the end.

of the day on the ground, in the air or on the ground, which is this will be the financing for startup societies. And the way I kind of think about it is, I think I mentioned this analogy to on the phone. You guys are seeing like a tornado like whirling through like the Midwest and it takes like a little house and it goes, who rolls it up into the air. You guys are seeing it. Right. So I often think of crypto as a space that's building the economy, you know, Wall Street first, Main Street last. So if you imagine that turning to whirling in reverse, right? So you start in the air with a digital gold and then you're building out this whole DFI Wall Street financial speculation economy and now we're getting Web3 infrastructure. In the very last frame of the movie, it goes,

flick like this with the wrist and with these billions and billions of dollars in the cloud goes like this and all the buildings build out on Main Street, right? Because those are actually all just F of H of X for this massive composable infrastructure here. The financing is there. You can pulled in from around the world. And it's just like a few bucks to just go and print it out in physical space, right? And that is actually kind of how I think about this entire machine that we've built can actually now be pointed at financing things in the physical world. And, you know, it's not like people talk about municipal bonds. It's like municipal equity. You know, you just go like this and then you build it. Okay. As much where I can say, but that's how it's, it's, I mean, the book is full of a lot of

futuristic concepts. It's interesting, though, the, because you and I have had conversations over the years. Just right way of background. I used to work for biology back at 21, which became earned.com, which got acquired by Coinbase. Yeah, five years ago, six years ago, thereabouts, yeah. Five years ago, that's right, five years ago. So I, I've heard so many of these concepts in kind of these early gestation of these ideas until they were formalized in this book. In a way, although you are obviously somebody who lives at the frontier intellectually, but writing a book is, also a very old-school way to express ideas. So I have to ask, like, why did you write a book? Of all things, of all the futuristic, crazy things that you could have done, why a book?

Well, I'm, you know, I'm pragmatic enough to make certain concessions to reality or what have you, right? And, you know, the thing is, it's kind of like, actually think about Coinbase itself, okay? When Coinbase first came out or, you know, the centralized exchanges first came out, I don't know if you guys remembered this, but it was considered heresy to, A, have pasture reset rather than fully custodial everything. B, this is Bitcoin. Why are you doing bank integration, right? C, this is Bitcoin.

Why are you buying with dollars for Fiat, right? And I think sometimes you have something which is like a bad hybrid of the old and the new. Like enterprise blockchain is like a bad hybrid, which had all the bad aspects of enterprise and all the technical complexity, social complexity of enterprise, the technical complexity of blockchain just didn't work. You didn't have the incentives,

right? I was trying to do blockchains without tokens. But sometimes you have a good hybrid, you know, a fertile hybrid, et cetera. And I kind of think that something like what I've done,

we'll see if it works. But, you know, in some ways, my biggest concession to the old world is just having an Amazon page for the book. Right? That shows it's like actually like a marked thing. It's like a timestamp release.

It's not just, just a continuous flow of tweets or people have to put together. It's a shelling point for people to refer to. And now that is actually like an installed base where I can just push more and more and more and more content into. And maybe that widens it's like 700 pages and, you know, all kinds of crazy stuff in there by the end. Okay. But it's like, okay, just go to that and you'll download the whole thing, right?

The 2021, 2021, 2022, 22, 23, 24 edition. I can push 50 pages, 100 pages of update every year, right? So kind of thinking of a book as like in the old school way as a shelling point that you can refer people to, but having some hybrid with a new school concept of being able to update it. This is all kind of obvious stuff in a sense. Like even in the 2010, you know, early 2010s or whatever when the iPad first came out, Al Gore actually was kind of a pioneer in this space. He actually, you know, leaving aside, you know, whatever else. I know people like, don't like Al Gore. But I respect him actually as a technologist because he did like interactive book stuff and so on and stuff.

You go back and look at what he did with, like an inconvenient truth. Inconvenient truth? Yeah, yeah. Yeah, he had kind of, he was kind of doing some interesting stuff with like, it was like one of the first interactive textbook like things and so on. It's actually still pretty fresh looking. But at the time, it was just a little too early. It was ahead of its time. You know, people weren't paying for content on the internet, all the types of stuff.

But I think it's actually worth revisiting that now that, you know, after COVID, we've had the digital flippinging, where the internet is first and the physical is now secondary. Go ahead. I want to give somebody else a mic, so I'll go on. I'll go on. I'll ask the first question here. So based on that model you just explained, you know, one of the use cases I can see is, you know, you could possess an NFT that gives you access to all of the current additions that come out. And you could, you know, sell or transfer the NFT and there could be, you know, some market for it. But like, you know, you could basically identify the ownership of the rights to all future editions in some like very crypto-native way. Have you thought about, you know, alternate models that go off of the Web 2 rails and come onto Web 3 rails. You know, can people pay, you know, for the book in crypto, you know, like, and how do you track that ownership and those rights? Is it just Amazon as a platform? You know, what's going through your head? Great question. So, so we did issue like a commemorative NFT for the book, right? And that's kind of like a marker, right? Like basically you pay 10 bucks for the book and we issue, I think a pretty cool

NFT, we did that through OpenC and so on. But that was not meant to actually be a speculative asset. And I mean, maybe it could be or whatever, but it was actually, it was not meant to be that. It was kind of just meant to be a marker. I am. Maybe let me, let me give a thought that I'm having, which is that writing a book in some sense, so a lot of people in crypto are already familiar with your ideas. You know, you make the rounds. Obviously, you're very, you're very well-known thinker within the world of crypto. In a way, it's, it occurs, it seems to me, like writing a book. It's almost like, you know, somebody who wrote one of the consensus protocols for, somebody who worked on Casper and decided to write up an academic paper and

submitted to an academic journal, right? In a way, it's kind of crossing a chasm to a different kind of, a different kind of audience and a different kind of status game. It's very different from the one that gets played in, you know, the Ethereum researching community. And so in that way, it's like, look, if you want to make your ideas legible to a broader audience outside of crypto and the people who are already fairly disposed to agree with you, then you need to make them legible in a format like a book, Amazon page, you know, cleaned a table of contents and blah, blah, blah, because otherwise you're speaking to people who already broadly agree with you. That's definitely part of it.

But I think Robert's question was on crypto-native mechanisms. But basically, yeah, Haseeb, I think, I mean, the other thing is also the networkstate.com. Boom. You can just remember that, right? that is memorable that fits in the head like, you know, I can't read, you know, all of somebody's tweets if you point me at their Twitter. I can read their most recent things. And they're not going to be able to recapitulate everything that they said there, right?

And so this is sort of like the V3, like, you know, V1 is everybody writes books and they're disaggregated. V2 is they have these tweets and, you know, they get upvoted or commented on and you have like these kind of distilled nuggets. And the V3 is a rebuttal. And actually something I think is underrated that we're going to say. see a lot of is the rebundling of social content. You know, sort of like, you know, you go from albums to MP3s to Spotify playlist. The rebundling actually does add value. You can see some

examples of this, for example, with Niv Drawer's calendar, the shrug calendar. I'm not sure if you guys have seen that, right, is just taking tweets, which are public and free, but putting them back together in a new and interesting way actually does add value. Many establishment periodicals, as you know a lot of political coverage is effectively, you know, just like, you know, sports, sports articles are recycles of the box score and financial articles or recycles of the ticker symbols. Many political articles are just wrappers around tweets, right? And so the concept of kind of taking social content and then reaggregating an interesting way, I actually think we'll see much more especially as the backends open up with like crypto social media. But actually, you know,

Robert, to answer your question, I think, and maybe, you know, this is like the next cycle. or whatever of crypto. I have always only been interested in crypto and even software as a tool to like advance us, right? You know, basically to to get to, you know, the, uh, the, the promised land of life extension and of, you know, advanced technology. So there's folks who love the charts and they love the, you know, the finance aspect of it and so on. And I'm fine with that. But I, I wanted to actually write this and then add crypto things if and when it made sense to help people do things like, you know, E&S login for the book app of subsequent versions so you can save your space or there's things like that that we'll do. But I didn't want to start with having

financial things driving it. I wanted to put them in if and when it made sense. And again, I'm not against other people who love that stuff, right? But I think it's a lot of it. of this very much as like a horse as opposed to or an engine as opposed to like the destination of the car or whatever, you know. Okay, go ahead. I had one quick question related to that. So the definition the book is actually sort of this long compound sentence. And also you also, you reference the fact that Britannica also does the same, you know, kind of long compound sentence, which I thought was kind of funny. So of those kind of each clause, you know, I guess there's two that are directly related crypto, right? The integrated cryptocurrency and this notion of consensual government

limited by social smart contract. What? Actually, Tarun, before we get to that question, can you just read that entire definition? Well, read the short one first, because I actually have the informal sentence. Read the informal sentence. So otherwise, it seems like I'm totally unreasonable. See at the top? Yeah. Okay, yeah, yeah. A network state is a highly aligned online community with capacity for collective action that crowd funds territory around the world and eventually gains diplomatic recognition from pre-existing. It's a long sentence, but it's not, it parses and you, it's like a not, you know, every adjective there, let me just kind of analyze that.

And the reason is, you know, you guys are all tweeters. And so you know that people pick over every, you know, syllable or whatever, you know, I know it's a syllable, but whatever. So a network state is a highly aligned online community as opposed to typical online communities that have no alignment, okay, or very minimal. line. With a capacity for collective action, again, that's a very high bar, right? Yeah, yeah, yeah. Like, the, you know, if you, if you, if you just go and most Dows, most discords, it's, it's like hurting cats. They're there for the airdrops and stuff. There's capacity for individual, like, gain. That's what they care about, but not for collective action and sacrifice working towards something. One way I think about it, if you think about Twitter itself, imagine an NBA game where every player just saw their own score, but there was no team score. right? How many dunks, how many points, whatever, but there's no, literally the sum was not shown, right? That's what Twitter is, where everybody has their own stats, right? They have their own followers or likes or blah, blah, blah, but what they do not have is any team score for their ostensible faction, which means that you have soap opera-like betrayals and all kinds of stupid stuff happening, where people who think they're actually, you know, perhaps they made themselves think they're advancing some ideological cause, but,

you know, like the tribalism is, it's not, it's in a very primitive way. It's not like the organized and systematic, you know, quote tribalism of an actual team, right? Where there's boundaries to the team, there's hierarchy, there's organization, there's division of labor. It is the sort of animalistic tribalism of like an informal group, right? It's not like a scalable sort of thing. It's not a, it's not a group that goes out to win, right? That's what I mean a capacity for collective action. Like a startup is just completely different from a group of randos on Twitter. then the crowd funds territory around the world, why did I include that? Well, the physicality,

look, I'm a huge digital person. I do think remote first, et cetera. But one of the concepts I talk about in the book, you know, the least popular word in the world, but which I think is one of the most important words of the world. Do you know what that is? Recentralization. Okay. Why is recentralization ridiculously unpopular as a word? Because both centralization and decentralization proponents don't like it in different ways. Okay. Why? The centralization proponents will be like, what do you mean? You know, new boss, same as the old boss. And so will the decentralization phone.

They'll both say that that's actually bad, right? But if you actually look at it, recentralization, what that would mean is consensual recentual recentralization in the same way that you go album to MP3 to playlist. There's many more analogies that are like that, right? You have newspaper, you break it out into articles, you rebuttal into a Twitter feed. When you actually look at what human behavior, you look at what human behavior is, is, they want that legibility, they want that discoverability, they want some order reimposed on the chaos, but that initial order is actually not suitable for them. So you break and then you

reassemble. And these are like historical cycles that because the internet, we're just seeing happen much faster. And the thing is, the reason I say recentralization is an important word, is that aspect of crowdfunding territory around the world, we have now gone remote first, right? all of us, I don't even know where your locations are, but it's probably not, you know, the same room. It's probably five different cities, right? This is actually kind of our community, okay? But we could take pieces of this social graph and then actually have them, you know,

you could have crypto towns and villages. We have the resources now as a community to start doing this. And now everybody's got something in common. When you walk down the street, you know that person, right? Wow. Who could have mattered? What a concept, right? Like in an apartment building.

Imagine that you actually knew the person who was like 30 feet this way and 30 feet that way. And they weren't like a total cipher or anonymous person to you. Like the crowdfunding of a territory around the world is like one of the apotheosis of the capacity for collective action. Because you're not just upvoting something at the same time. You're crowdfunding something and you're collectively moving there. Okay. And the last bit eventually gains diplomatic recognition of preexisting states. So just like, you know, Clay and Christensen had this term disruptive innovation.

and that got taken by people and they used it in a way that, you know, he didn't want. He wanted short information be like a low-end innovation that comes in and then it kind of goes to the high end. But people just use it as like something that comes in and just wins or whatever, right? Necessarily is how words work. If you want the specific definition of a network state, it's one that has diplomatic recognition. By this definition, nothing is yet a network state in this definition. The reason I use that is you might say, why would, you know, some crypto person who's all, you know, like independent, blah, blah, blah. Why would you want diplomatic recognition? Well, I argue it's

actually very similar to the reason that you want to be able to trade cryptocurrency for fiat currency. It is almost exactly the same, in fact. It is the crypto country, fiat country interface. Okay. Diplomatic recognition is you've generated these new crypto countries. For the old system to sort of acknowledge they're legitimate is diplomatic recognition. Once you have that, actually lots of things become possible, deals become possible, other things. But another way of thinking about it is, I know it's a funny way of putting it, but I put it in the book this way. Diplomatic recognition is a non-binding commitment to not invade. Okay.

For example, like the U.S. diplomatically recognized Iraq. That's why I say it's a non-binding commitment to not invade. It did invade. Okay. Right. But it's an international incident if, you know, like you go and quote invade a sovereign country. Russia invades Ukraine. It's an international incident, right?

By contrast, if it's just a bunch of guys on, you know, sea land or, you know, liberal land, which is not diplomatically recognized by anybody, that is not a sovereign. And no other government will care. It is not a diplomatic incident. It's a bunch of delusional people on a barge or whatever, whatever, right? So their diplomatic defense is actually very low. And it's not just about you and what army. It's about you and what diplomacy. It's you and what nation, right? You and one country backing you. A lot of libertarian types get this wrong. And so just to say, the reason that this definition is long, that lengthy one, is meant to sort of preemptively address many different kinds of failure modes, things that people have tried and failed, things that people will throw at you

and be like, ha, ha, you're so impractical. You didn't think of this, did you? And all these different, you know, things that like the folks will throw. That's why the definition, the second definition is long. Okay, go ahead. It's yours. Let me try to push up against some of the, some of the boundaries in this, in this kind of core thesis you have. Okay. So one of the things that you mentioned, so I'll just pieces of the long version, right? So a network state is a social network, moral innovation, a sense of national consciousness, a recognized founder, capacity for collective action, an integrated cryptocurrency, a consensual government limited by social smart contract, an in-person level of civility, yes. I'm jumping around. I'm jumping around.

I think most crypto people, if you just take the description thus far, they will nod their heads and say, oh, yeah, yeah, this sounds a lot like crypto. Like I totally, all these things are clicking in my head. And then you say, a, da-da-da-da-da-da, an archipel of crowdfunded physical territories. And this is one of the central concepts in the network state that differentiates it from a lot of the people who talk about the radical concepts within crypto that enable different kinds of governance and blah, blah, blah. So I guess the first way to push up against this concept is why is it not enough to have a

community that is large, potent, ideologically aligned, and is still potentially in a position to present to nation states or to a state? nation state as a voting block, as a very strongly aligned group of people. Why do you need to go, and, you know, if I compare, for example, like the Democratic Party as an institution, which is very powerful compared to like, you know, the Panama, one of them seems much more powerful to me than the other, although one of them is diplomatically recognized, has land, et cetera. So how do you think about that? Why do you think there's such an important state transition that you need diplomatic recognition and crowdsource land.

Well, so the Democratic Party is an interesting example because it does control territory, arguably, right? It can repaint streets, like it can, you know, there are like blue governors and stuff. They can do executive orders. You know, there's more contestation within the U.S. State capacity has declined in many ways. But there certainly are times, you know, when political parties can animate and control state control territory and whatnot.

But picture is worth a thousand words. And so if you zoom in on this, right, you know, I intentionally did a few different things with this. Basically, it's black and white. It is a lo-fi mock-up. Well, I'll just, okay, there you go. Great. So this is basically a, what I call the census, census dashboard of a network state.

Now, do you guys know, I mentioned this in the book, but maybe you're aware of it or not. Do you know the census is actually called out specifically as something to do in the U.S. Constitution? The post office is in the Constitution, the census is in the Constitution. The thing about this visual here is you're seeing lots of nodes around the world. They are connected together via the Internet, and their cumulative population and income in real estate is quite substantial. And here's the thing. You can now start benchmarking something like this versus what we typically think of as a state, right?

You think of the population of a country, you think of its annual tax revenue, and you think of its physical footprint. even if it's a distributed state, I might say a decentralized state, okay, it has still got many of the aspects of we think of as a state. And if you actually go to, for example, the map of Indonesia. So to be clear, Abology, what you're picturing here is almost like the predecessor to a network state. Or right now you basically have the network. Yeah, this is the network archipelago. Without the physical land. Yeah, this is the network archipelago. Right. So, and it's just like an archipelago, like is an island kind of thing. Okay. So this is a map of Southeast Asia. Okay. And you can see there's individual, I mean, they're all blue or whatever, but if you zoom in, like Indonesia, for example, if you looked at it from space without knowing where the ethnic groups are, you would not be able to guess the boundaries of Indonesia. Okay. Like, you know, like look at Brunei or look at, you know, Malaysia, like the boundaries of it. There's like national boundaries. You see that boundary on like the large island in the middle there. Indonesia is.

is like a bunch of little pieces of land separated by ocean, right? What if they were a little piece of land separated by internet? That's the concept of the network archipelago. But at that point still, you know, people are landowners in their respective states, but they don't have any monopoly over violence, which is one of the, you know, one of the prototypical features of actually having a state. Sure, yes. Everybody in the network in the network archipelago is still subject to the laws of the country

they're in. they might have collective bargaining power as a group, much like I would argue like another kind of civil society institution, but it's a civil society institution that effectively is multinational. Yeah. So the thing is that basically I think there's many, many levels you can get to. And I actually identify four waypoints. Okay.

So those are startup society, network union, network archipelago, network state. Okay. Startup society is just you're just one person with a dream. It's like Zuck sitting at the laptop, cracking his knuckles, one person, but you have ambitions of something bigger. A network union is a second step. That's a digital collective, capable of collective action, right? It is, it's like a highly disciplined Tao, for example, but it's actually something that thinks of itself, just even saying that they've got a sense of national consciousness or this sense of collective, you know,ness. They don't have to necessarily become a state, just like not every small business has to go public or what have you.

Many of them, in fact, will just stay as network unions. Guilds would be like this. Many NFT communities you can think of as being like this. Okay. I think many pre-existing subredits could eventually become network union-like. And I think the interface will determine like the kinds of things the network union can do. But it's collective action with the treasury. You can, at a minimum, think of it as a Facebook group with a cryptocurrency linked together.

And it's like a serious online community. just do up votes and stuff. It does collective actions. It has money, et cetera. Okay. So the network union is a huge step above a simple Facebook group because you can do things together, right? You can find somebody a job. You can crowd fund their business. You can, you know, like promote their new project, blah, blah, blah, all those things you can do. Okay. Then step three, network archipelago, now you're crowdfunding territory. Okay. And importantly, by the way, and I include examples of this in the book, as you, as you, you sort of go up the ladder here, there's some kinds of collective societies that you can do

with a purely digital-only approach. Okay. For example, I mentioned like the cancel proof culture. Okay. If you say the problem with society and everybody has a concept of the problem with society, I call this the one commandment, what your differentiation is from society at large. If you're visual of the problem with society is, people get canceled. If that's the single biggest problem in your view to solve, you could build a network union that, is, for example, a guild of, let's say it's graphic designers. Okay. And this guild, 99% of the time, they're just sharing Figma files, they're talking with each other, you know, tricks of the trade, blah, blah. One percent of the time, they're getting somebody there is getting hit online.

They pop in. They invoke Article 5, an attack on one is an attack on all. You know, that's a NATO, you know, kind of thing. I think it's Article 5, right? Basically, they invoke that, attack on one is attack it all, and this beehive of all the designers comes out and it's posting memes, you know, how dare you, you know, civirmanus some, right? Like, you know, this is a Roman citizen, how dare you attack them? And that, that's just a value proposition right there. The cancellation insurance, in a sense, is built into the community kind of spirit. You're a dues-paying member of this guild. It will defend you. And there's probably also, by the way, some rule of law around this, right? When you come in or that person comes in and says they've been attacked, right?

then there's some adjudication process. Oh, did you strike first, right? Was it like you say some stupid slur for no reason and blah, blah, blah, right? And you have actually some like written law as to what the penalty is. Crucially, by the way, if somebody said a stupid slur, then maybe the penalty is, okay, you have to go and give a hundred bucks. It's not the ruination of their life forever and ever. And so you can figure out what the what the scale of it is. If it's like 15 years ago and it's being brought to the present day as if it's this thing, right? So that community, that digital network union starts to reestablish law, written law, as opposed to an emotional Lord of the Fly style reaction where everything is based on the passions of the mob at that time versus being like, okay, did they do X? Then I look at the law and it says, if X, then why we agreed on it in the abstract. It's rule of law, not just how much do we dislike or like this person at this time, That's what rule of law means. It means you take away the passions of the mob and you actually put that into some kind of code, right? So a network union actually already can do a lot of interesting things, just a purely digital thing.

But why do you need the physical? Well, there's a lot of things. I mean, we're still physical creatures, right? So I mentioned, for example, keto kosher as one example. And I've got like dozens, dozens of more examples. You know, I mentioned digital Sabbath, just to go through a few. These keto kosher would be a network union that decides we want to basically try to eliminate sugar from the diet. You know what? You can do all kinds of willpower type stuff, atomic habits type stuff online.

But you know, it's actually way easier. You know, you just want to make one decision to like move to a community. Okay. And then the healthy living is just taken for, care for you, right? You might have to actually literally drive a few miles to get out of that community and go back into the den of iniquity where, you know, high fructose corn syrup is mixed with everything. Okay. Once you actually have some physical boundaries in this example. Okay. Have you guys seen the obesity gift, by the way? The obesity epidemic gift? No? Okay. Most people haven't actually seen this, I realize. And once you see this, you're like, okay, actually, this is like a way more serious problem than people even realized. Okay. So here you go. Ready? One one quick question, actually. It, you know, what you

described actually reminds me a lot of like how the Freemasons sort of like, you know, if they were in the internet. Are you saying like the Freemasons would be sort of the network union if we, I was actually going to say that the Catholic church is probably the first network state. I was actually going to ask like, I remember the keto kosher thing from the book and you sort of talk about the fact that like, you know, the most successful, you know, early U.S. colonies were the religious ones, not the ones that were, you know, founded for just, you know, purely, you know, merchantile reasons. I'm curious, like what you think the first network state is going to be. Because a lot of the stuff, like, I agree, you know, there's a fan base around it, there's a community, but like people are not

so high affinity, so fervent about it, right, versus maybe something like religion or your ethnicity, which tends to be kind of where nation states come from. Like, like, what do you think is the thing that people are going to be so passionate about as to go through all this energy, uproot their lives to like, you know, start this thing? So the reason I mentioned keto is it actually is a pretty big thing. I mean, like, our keto. So like, how many, without looking, how many people do you think are in R keto, like the Reddit suburb for keto? 10 million? 5 million?

3.2 million. Okay. All right. Right. Or two men of magnitude. That's kind of a lot of people. Yeah. I mean, definitely popular, but like the level of passion around is what I'm curious about, right?

Like, Roblox is huge, but. Yeah. So let me, let me, I'm going to argue this point with you, actually. So first of all, look at this GIF. Right. I don't know if you guys have ever seen this gift. this is the faddening of America and actually the camera ends in like 2013 okay where it's already like this creeping epidemic and you know how much fatter people have gotten like since then it's like

insane okay people actually think this might be partially like a virus or some pathogen just like ulcers were caused by h pylori as sort of a cryptic pathogen for a long time and maybe that's contributing to obesity or something is where the the diet is adding to it or it's um you know palatable snack food. Who knows? Point is, people are really getting fat in the U.S. and around the world. This is like a big thing. And that's upstream of diabetes and that's upstream of, you know, COVID mortality and blah, blah, blah, all these things, you know, aesthetics, of course, all those things are kind of just downstream of being a fatso, right? And I know because I was a fatso just like a few years ago or whatever, and, you know, like a see been hitting the gym or whatever, you know, recently, right?

my point is basically that something like keto is actually totalizing. Why? Every single meal you need to be keto. Every single thing you put in your mouth has to be keto, right? It is actually something which passes Sergey Brin's toothbrush test of you need to use it twice a day. Moreover, it's not just something you need to use twice a day. You need the community to support you because unless you are hunting and gathering everything yourself, you have to spend enormous effort.

Does this have sugar in it? Does this have sugar in it? What you'd like to do is get collective benefit. and essentially enforce a boundary around that community where the snack wells are stopped at the door, you know, like those things are intradited. It's literally like border control, you know, customs takes care of it for you. That's scalable, right? So I actually pick that for a reason because it's actually something where if you think about a big part of religion on a practical daily basis, it's dietary prohibitions. You can't drink alcohol. Cosher itself is obviously a religious thing and so and so forth.

right and crucially you know if you look at religion it's down into the right many forms of traditional religion you know it's up into the right is the our keto community so all of those things kind of you know net into something like this these kinds of internet movements that i think would be totalizing and then once you get that one commandment of like you know sugar bad keto good you actually get derivations do you guys know what a cGM is continuous glucose monitor yeah my wife has one um so continuous glucose monitor is basically it's one of these patch generally that you put on your body and you can like, I think it's like Bluetooth, you just scan it and then you can basically read your glucose levels throughout the day. So something generally

the diabetics historically have used, but now increasingly healthy people are just like, I want to know my glucose levels all day long. And so you can import them into apps, you can analyze them. And so people get obsessed with that. And it's much better than pricking your finger. That's right. That's right. That's right. That's exactly right. And so the key thing about this, the reason I think this is a you know how there's saying i think it's dixon saying like what nerds do on the weekend everybody else will do in 10 years right nerds are working on you know tech people palm pilots and then 10 years later everybody had an iPhone 20 years later everybody in the world has an is a smartphone right so the cgm is really important because we know more about what's going on

on the other side of the world in budapest or in banglore than what's going in in our own bodies okay like all of this machine learning type stuff should be trained on the most important like measurements like the dashboard that you should be looking at every time you get up in the morning is not some stupid news article on something of no consequence to you but like what are your readouts right like that's actually the news you can use that's the most important stuff you care most about that nobody else cares about that as much as you do right this is in the same way that your corporate dashboard this is a broader concept but i think the morning newspaper will be is being replaced by the morning dashboard that's actually like the news is the worst thing

you should be looking at in the morning because that's like everybody what everybody else cares about. The dashboard is what you care about. You are driving. It is the dashboard in your company is it's on portfolio. All the things which have levers next time. And the most important of which is your body. Right. So the CGM, I think, is a piece of that where it's taking metrics off of you and then it's putting them there and now you're actually seeing it. You're tracking it across time. Why do I mention this? Because it's downstream of that keto premise. Once you say that carbs bad, then you get to CGM good. Then you get to everybody, universal CGM good. And then you get to, oh, now we can collect stats across the community and so on and so forth.

And this is an example of how like a moral innovation when you actually, when it goes to 100%, a derivation from it goes to 100%, a derivation of derivation goes to 100%, and so on. And you start actually building the technology to fit that moral innovation, right? Rather than being idiosyncratic, if you actually go back into history, this is very common. The relationship between moral progress and technological progress, you know, for example, once you can say that, you know, the earth goes around the sun rather than vice versa. You can get better star charts and eventually you can get satellites, okay? Once you can say that, oh, actually, man and monkeys have a common ancestor, that opens up

in the fullness of time, evolutionary genetics. Speaking of moral progress, because I think that's also a very important vector in this book that we haven't talked about. Yes. The network state is partially about a prediction about the way in which the future will unfold and the way that different kinds of states will emerge. But it's also advocacy in some sense. And so a big part of the book is devoted toward your,

I think the way Vitalik describes it is your megapolitics, which is a kind of, the encapsulation is this tripartite chart you have of NYT-C-CP-B-T-C. Describe for us briefly what is this tri-I-I-I-I-D-I-D-I-D-T-Lemma between NYT-C-C-P-P-P-P-P-P-C-P-P-C-P-P-C-P-C-P-P-T-C-P. Tripolar triangle. Tripolar triangle. And incorporating to that, why is it not just that the network states will exist,

but why it is good the network states will exist? Just to put a bow on your previous thing, you asked why physical. I'll just go to this, just to put a bow. You asked why physical, certain kinds of societal innovations can only be implemented physically. And then certain more kinds can only be implemented if you have legal or diplomatic recognition. So that's why physical, so rather than remaining fully digital. Okay. to come to this. Basically, as I mentioned at the beginning, I'm going to factor this a little bit more into problem and solution, right? And like the book meaning, I want to factor it like this, where the problem is the state of the world as I see it is we are headed for what I call American Anarchy and Chinese Control. And by American Anarchy, what I think is going to happen and what I sort of foresee. And I put a bunch of evidence in the book. I literally, this is one of the things where I want to do the next version where I have like 200.

references and all kinds of graphs and charts on this particular thing. Okay. But if you just bear with me, I kind of think that, so I have to be political here because it's just going to be, you know, I mentioned this book. You just talk about large humans. You have to be political. Okay. It's in the book. So if you think about what happened with, let's say, Occupy Wall Street. In the early 2010s, people might have thought that the big left movement was going to be economic, but that was actually kind of like a head fake and actually it turned out to be cultural with what people now call wokeness. It's a, you know, it's cancellation, me too, BLM, all this type of stuff. Okay. And with the right, if you looked at the last several years, you might think that the big

right movement was going to be like culturally nationalist and so on. I'm not saying there's no, that's zero. But I actually think that's going to be in the fullness of time ahead fake. And the true energy is going to be economic right in the sense of ultra Bitcoin maximalism, crypto-anarchy, etc. Okay. And the reason for this is, is that, so that head fake of, you know, faking economic left and actually going cultural left, faking cultural right and actually going economic right. I think that's an important thing where that last step, economic right, the way I sort of think about it is you can look in lots of lots of like Republican primary race and so on.

You start to see them signaling maximalism, right, Bitcoin maximalism. Why? Because if like wokeness is sort of like ultra-democracy, maximalism is like ultra-capitalism in a sense. And then woke capital is like wokeness plus a form of capitalism. And Bitcoin maximalism is like capitalism plus with a PLEB thing, it's like a form of ultra-democracy. Right. So both them are these weird, just to explain what I mean. The wokeness is like, you know, it's supposed to appeal to large movements of people.

Then it captures institutions that has huge amounts of money. So it's like this democracy plus capitalism fusion. Bitcoin maximalism obviously started with a new form of capital with Bitcoin itself. But now recently with the whole sort of PLEB ideology, it is, if, people who know or watching this may know what that is, but it's like essentially, though it's usually not very phrased very explicitly, all who hold Bitcoin are equal. And because Bitcoin is the best, they are better than all who do not hold Bitcoin. That's roughly the PLEB ideology.

You're not supposed to ask how much Bitcoin somebody had, how early they were, all of that. You know, now you're born again when you buy BTC and you have even $100 and you yell at people online. You're a PLEB. You're a max plus. Okay. Now, the thing about this is if you go and look at it, people use terms like immaculate conception, you know, for talking about like the blockchain. They call it the Genesis block.

You know, Satoshi is like sort of treated like this Jesus figure. There's, there's in the same way that people have talked about wholeness as being like a Christian influence type of thing. Tom Hollins talked about this. Noah Smith, Yarvin was one of the earliest, you know, actually John McWhorter has a whole book on this, blah, blah, blah. A lot of people have talked about that where you have aspects of like original sin and, you know, we're, you know, we'll all be damned if we if we do this, the elect, these kinds of premises, there's aspects of Christianity that have gone to maximalism. You know, you see people, for example, they tweet the scene of Jesus throwing the money changers out of the temple, damn shit coiners, you know, throw them out, right?

And so bits and pieces of this sort of Christian eschatology have sort of split and made their ways into wokenness and maximalism. And like the Republican Party doesn't have that. The Democrat Party actually, those are both actually downstream of these, these forces, right? These are forces that are like a fusion of democracy and capitalism plus piece of Christianity that are lying around, you know, Christianity itself, people don't believe in it anymore, but it's like, you know, that's saying the God-shaped whole, right? The ruins of Christianity that are current Western civilization, those myths stay around and they still have some purchase on people and they get reanimated in these forms. Okay. And I do think that maximalist versus woke is going to be

like the new communist versus Nazi, except this time it's the left that's racial. obsessed and the right that's economically obsessed. And that conflict, communist versus Nazi, was Stalingrad in the 20th century. That was the most insane conflict of the early 20th century. And you saw that building over years, decades. That was just a smash. And like that kind of determined the outcome in many ways of, you know, World War II. That was like the climactic conflict, right? I do think something like that is coming. I don't know exactly what form that takes. I do think these are the two forces. I think it probably happens sometime around the time the U.S. government is basically broke and it's printed the money and it's coming for people's money.

And so it's the conflict between the like totally unstoppable force of the U.S. government and the irresistible object of Bitcoin and maximalism. And I can sort of see that coming. Like that's this sort of God or Dammerung, this Ragnarok, this Armageddon, whatever you want to call it. I do see that coming. So it sounds like you're framing. Sure. So you're framing the power of basically Bitcoin maximalism. I know that you are not a Bitcoin maximalist. And I don't think you're particularly sympathetic to Bitcoin maximalism. What is the middle way that you are advocating that is not either these poles? Right. So, so there's a actually

actually, it's really like I think of there as being three poles, right? So I look this is like a fourth. So, you know, the thing is that quote as a person of color and so, sort of, there's aspects of wokeness that, of course, you want equal treatment under the law. That's why it's actually a very complicated thing to discuss it, because there's a whole continuum of folks who have good intentions all the way over here, right? And then it gets to this insane point of like just, you know, all the stuff we see online. But, but there's a kernel of like, yeah, of course you want equal treatment under the law, duh, right? Like that's, you know, that's just, you know, common sense and, you know, civil liberties and so on and so forth. But it gets distorted and inverted on the end over here,

into something that's like a, you know, there's a huge difference between a, for example, an economic, progressive, and a communist, between a conservative and a Nazi, between a liberal and a woke, and between a libertarian and a maximalist, right? Once you get to that corner, things that were previously premises, like tolerance, for example, get inverted and turn into intolerance, right? Or you go, like in the libertarian corner and, you know, non-aggression principle, everybody can transact, oh, actually, let's sick the adjunct. SEC on these quote-sh pointers or whatever, right? It starts to be something where the ideology gets curled and distorted on itself.

And, you know, what people have talked about is so-called horseshoe theory. You know the political compass? And Bologi, because this is a crypto show, try to point out the overlap of the political compass and crypto. Well, we are now a crypto politics crossover show to see you know. Well, that's the thing is the problem is like you may not be interested in politics, but politics is interested in you. Very true.

And, you know, I think it's Lenin saying, right? So this is the political compass, okay? And there is a post here that I actually thought was actually pretty good. Very roughly speaking, top left, communist, top right, Nazi or nationalist. Really, you actually could argue top middle is Nazi. Top right is like pinocet, okay? But let's say top left communist, top middle, Nazi, top right, you know, like a pinnichet. Bottom left woke, bottom right, Crypto anarchist or maximalist. I'm talking about the corners, by the way, not the center, the very corners, okay? And what you kind of get is you have pathologies that when you push each to the corner, you get a pathology. For example, top right, take for example slavery. The top right,

slavery is slavery. Top left, communism is slavery. Okay. Lower left, drug addiction is slavery. Lower right, debt is slavery. Okay. You can actually have bad versions of things where there's, you know, like drug addiction, you're no longer yourself. You're kind of enslaved to this drug dealer or what have you. When you go into the total liberty of the lower left, you can actually end up in a bad place. When you go to the, quote, communism, the workers' paradise of the upper left, well, you know, the gulog, the white sea labor canal, that wasn't the workers' paradise. It weren't getting any days off. Okay.

So communism ends with slavery. And of course, debt. You can, you know, do voluntary economic interactions between people and end up in something that's very similar to like debt slavery, right? And so, and then of course, the top right is the obvious one. Point is that there's like pathological cases where if you take some principle to its extremes, you end up in this anti-human bad spot, you go off the map, right? And one thing that people have conceptualized a lot, you know, top left, communist, top right, Nazi, and people will say, okay, those loop together and they become the same thing.

And in fact, there's this great movie called the Soviet story, okay, which actually shows lots of communist and Nazi propaganda, you know, like posters and how they actually really resembled each other. Why? Because they were actually recruiting from the same population, you know? Hitler's whole thing was that he wasn't just a nationalist. He was a national socialist. He was a socialist socialist. He had like crossover appeal and tried to pull some of the disaffected folks, you know, the National Socialist German Workers Party. He devoted two of the four words to that. And the Soviets, you know, under Stalin went to like Soviet nationalism. They appealed to the right and they weren't just communists. They were like a fusion of leftism and rightism. So their propaganda

posters, all this type of stuff looked very similar. And so that's, That's why people talk about so-called horseshoe theory where the far left and far right become the same. But there are new things in the world. And we're so vaccinated against especially Nazism and fascism, but also communism to some extent, that what happens is you get a push in the other direction, right? It's like, you know, the Gerardian founding murder, you've got these total black holes that nobody wants to be a Nazi or a communist. And so, well, those are bad. So what's good?

The total opposite of that, right? The lower left corner is good. It's Antifa because it's not fascist. And the lower right corner, you're probably seeing more and more folks call themselves like communism disrespector or something like that on Twitter. Why? Because who would be a communist? Even the lower left, you know, some of them will actually put a hammer and sickle, but most of them don't really, really endorse the gulag. Okay. So now what happens? There's actually a different kind of crossover. And that is not totalitarianism. It is anarchy. Okay. The lower left and lower right, where do they cross over? well, the woke says, everyone is equal. We are all equal. And the maximus will say, you ain't the boss of me. And you put those together. And even though those vectors, you know, they've obviously got a left and a right flavor to them, you know, vectors can cancel on some axes and some on other axes. And so these ideological vectors, while they cancel in some ways, they sum on one axis and that axis is anarchy. It is the absence of legitimate leaders. It is absence of legitimate hierarchies. It is America is both institutions,

racist and it's irredeemably leftist, right? It's the deep state and it is the racist state, blah, blah, blah. And so you sum that up and what people can, quote, shake hands on is the complete illegitimacy of all institutions. And that leads you to American energy. That's the energy that I see, unfortunately. Okay. Let me pause there. Go ahead. So, okay, actually, it's a good time to pause because we are running up on time and there is more that I want to talk about. So let's let's Let's take that. Well, hold on, hold on, hold on. Let's take that as a broad preview of the book. I would strongly recommend whether or not you agree with the vision that Bollogy presents. It's one that you need to grapple with, especially if you're in this industry.

So Bolli, what is the best way for people to find, read, consume, the network state, and what's coming up for the book? Sure. So find where you consume, go to the networkstate.com. Go and subscribe there. You will get notified as new versions and stuff come out. Or you can just go refresh the site. We're going to do a hardcover, going to do an audible. And, you know, like, I may be wrong on all of my stuff, by the way. Of course, I could be wrong. And one of things I actually want to point out, take pains to point out, is you do not need to agree with me on all or even most or any of this. You don't need to agree with me on problem to agree on solution. For example, with, like, I think of network states and startup societies as a response

to the chaos I see coming in America and the crackdown I see coming in China. Okay. I see both of these as bad things that are coming that will justify themselves with reference to each other. Okay. The disorder of America will be justified with, well, at least we aren't China. And China's massive digital totalitarianism crackdown that I see coming, which is, I mean, obvious, you know, but like it's actually becoming somewhere people are actually leaving China now because of it, right? That crackdown is, um, some of the, something that will be justified as, well, at least we aren't anarchic like where America is. Okay. That's a really terrible vice to be put in where that's the, you know, assumed, you know,

you must be A or B. And so that other option of, you know, what is the other option, the re-centralized center, right? People who actually grouped together with others of like mind where you can't just listen to a politician and just buy into what they're saying because their campaign promises are non-binding. A startup society or network state, you can see how those campaign promises manifest in reality. You can tour it. You can go there. You can see if it's amenable, if it's worth a subscription. And if you don't like it, you can leave. And so it's disciplined by exit and by pragmatism. And that, I think, is, you know, people becoming the change they want to see because people will disagree with this anarchy and control thing in many different and incompatible ways.

But we can basically, you know, embrace what I think of as polystatism, not just polynumism or polytheism. Okay. So the answer is go to the networkstate.com, get that. We will have an audible. We'll have a hardcover. We'll have more stuff. All free. Go check it out. Oh, by the way, it is despite giving it away all free. Do you see my tweet on this where like it's a Wall Street Journal bestseller, even despite giving it away all free? I laughed when I saw that because I had actually checked. And the NYT bestseller list, by the way, is fake. Do you know, you guys know that? The NYT bestseller list is fake. It's editorial content. The Wall Street Journal one is actually the one that's based on actual

stats. Anyway, go ahead. Okay, good to know. So, okay, we are technically a crypto show, and so I want to try to bring it back to crypto in the end. So you are well known as being one of the, let's say, one of the elder statesmen of the

crypto community. It's been, well, it's been a very interesting four years. You've been through an entire cycle now, and you've seen, we've all seen, an enormous amount of folly, a lot of, you know, irrational exuberance that has kind of fallen back to reality.

But also a lot of experiments around governance, some in the spirit of some of the radical ideas that you describe in the network state, and most of them have not succeeded. Even things like prediction markets, even things like the idea of creating coins that represent some kind of claim over some smaller group or some smaller nation,

those have largely failed to hold root or really become big phenomena. Where do you think people have gone wrong so far? It seems that most of the things that have worked in crypto are basically their ones, very simple defy, some of the stuff that you said early on. It's like, look, I like that. It's there. It's not really my thing. That seems to be most of what's worked.

And then NFTs and gaming, this kind of stuff that's less about political organization and more about people just speculating, having fun, buying things that are cool. Why do you think that is and where do you think people have gone wrong? What would be your recommendation to somebody who's hearing this message and says, okay, I want to do better? Let me talk about something that we've talked about 10 years ago, even before crypto was even a thing before we were through any public cycles or whatever. There's an Amazon link that I put there. All viewers of this podcast should go and get this book and at least browse this. It's an academic book by Carlotta Perez, technological revolutions and financial capital. This will give you a different perspective because it goes through the past and it shows that almost every single bill, you know,

whether you think about railroads, other aspects of the Industrial Revolution, there's like this very common thing. It looks like the Gardner hype cycle. Okay. This is, it's almost like the way that humans innovate. Okay. Technology trigger, huge excitement, financial spike, all kinds of money goes in. Crash because, you know, most of those projects can't live up to where they're, you know, they're speculated to be. And natural selection event. And then out of that rubble come like one Amazon and one Google and one Facebook or something like that that pay for all of the other stuff plus more. Okay. You know, for example, the dot com bubble is one that people know existed, but, you know, some of the folks here were around for that.

I was pretty young at that time. But the dot com bubble was like this. It was bigger, arguably. I don't know if you actually look at the numbers in terms of relative percentage, but there's a site called fuckt company. com that just documented all the stuff. And everything was obviously moronic. Think about web van. Ha ha, how stupid that was. There was this thing, you know, people made fun of it. Lull, you're going to get your groceries delivered at home. Cosmo. Oh, yeah, you're going to just click a button and get something delivered to you in a big city. How about the QCat? That was completely moronic that you

were going to scan a barcode. No normal human being would ever do that. Of course, 10 or 20 years later, we have Instacart and we have Uber Eats and we have lots of QR code scanning stuff, but you needed a whole technology build out to get there. Almost every stupid concept during Web 1.0 during that dot-com boom did eventually work five or 10 or 15 or 20 years later, but the only ones that survived and they did so, you know, with great resourcefulness, were those that sort of were able to deal with this bandwidth constraint and suddenly capital constrained environment. Amazon, Yahoo, Google, and only accepted search queries and return back blue links. Netflix did not allow streaming at that time. All those things were built for that

environment and they managed to make it through the meteor event. And so whether it's a dot-com bubble, whether it's railroads, this is just kind of how this stuff happens. And if you have the long lens on history, you're like, okay, I'm dispassionate about this now. I understand this is coming. I have my emotions out of it. And I know there will be a natural selection event. And let me just pick the winners that come out of this. Let me pause there. Then I can't say, I do think there are some winners, by that I would disagree with you that everything is not working. I think E&S is a huge hit. And that's being kind of quietly working. And that's a very important piece of infrastructure that's going to come. There's an article that we wrote called the, or actually that John Stokes were

called the billion user table that's at the networkstate.com that I think is good on that. I think all this defy infrastructure, the composability, even if it was used for financial speculation, much like during the first dot-com bubble. During the first bubble, for example, eyeballs, that was totally moronic, obviously, in retrospect, in the mid-early 2000s. Okay. Everybody knew eyeballs had been described. Okay. Eyeballs are just meaning attention to your site. Obviously, eyeballs aren't money.

Ha-ha, stupid.com. They didn't have the epithet of tech bro or whatever then, but they would have used it. Like, these dot-com idiots are so stupid, blah, blah. But do you know how eyeballs actually became valuable is once people realize it wasn't the same, it's just offline ads where you show the same ad to everybody, but you had targeted ads, personalized ads, the entire Google machine came out in 2004. It was like, oh, my God, I can't believe you can make so much money on the internet. Even in 2002, you know, the New York Times, Salzberger's disinformation agency ran about Google.

In 2002, you know what they printed? They said, Google's toughest searches for a business model. Okay. Now, they were still pattern matching all of the dot coms failing onto Google at that time. Google's toughest searches for a business model. And this was like the Sunsuit thing, you know, where when you're strong appear weak and when you're weak appear strong, Google wanted to appear weak because they didn't want Microsoft to hit them.

Okay. So they intentionally were like, oh, yeah, you know, we just got to figure out how to make money in this shit. Later in their S1 in 2004, when they were forced to disclose, they're making something like 300, 400, just that year alone, okay? Google was just destroying it even in 2002. So their search wasn't for a business model. Not at all, right?

The point is it took a long time for people to have the perceptions catching up with reality. Even in 2013, okay, all right? There was an article that was published saying Facebook will never make a significant profit. Okay, 2013. And then what happens is it goes from, this will never work. You know, all you guys are stupid and delusional. You're all losing money, et cetera. And there's like a tiny, tiny, but where the,

the messaging has to kind of pause and stop. And then do you know what it's going to become? Threat to democracy. Okay? The next cycle is when crypto becomes a threat to democracy, quote, unquote, in, you know, the distortion, because it'll all work. Okay. We are, so Bolli, we are up on time, but I want to ask you one final question to close

us out. So today we have startup states. We don't yet have network archipelagoes. We don't yet have network space. What is your over under median date? We see the first network. archipelago and when do we see the first network state arguably you have some i mean you've got things that are pieces near this i mean i don't want to give a time frame and the reason i don't

let me put it like this okay i mean i will give one kind of time frame which is let's call it a goal but not a prediction right uh because if you go to the networkstate.com front slash dashboard well so if you go to the network state dot com front slash dashboard this is like a tracker of startup societies And we actually have 23 of them that we're seeing already. Okay. And they've actually raised a fair amount of venture capital collectively. It's about 180 million, 200 million collectively, which is more than people think, right? This space is happening.

It is like crypto in 2013 from a venture capital standpoint in terms of how much has gone in. And so can we get from 20-something startup societies to a thousand? I think we can. It's actually harder to go from zero to one than from 20 to a thousand, right? like, you know, we have to prove out the business model. We need to each of these have a very simple business model in theory, which is society as a service, right? You just pay and you have a membership, right? That's a very well-understood business model.

It's like SaaS, okay, ARR, et cetera. And if that works, if we can get from 20 to a thousand startup societies and, you know, so on over the next decade, I do think that if we can get to a thousand start societies, we might be able to get the first diplomatically recognized network state in like 10 years. or so. But that's a goal, right? It's not a prediction. It's a goal. Just to give you some precedence for that, why is that not completely crazy? Well, think about the dot TV and dot CO domains. Those are deals with Tuvalu and Columbia, respectively, sovereigns do domain deals. They get hard cash for it. Okay. Look at the Wyoming Dow law. That's effectively an interface between a sovereign

and the Ethereum network. Look at the El Salvador, Bitcoin law, or the Central African Republic. That's an interface between a sovereign and the Bitcoin network, right? They said between Wyoming and the Ethereum network, between El Salvador and the Bitcoin network. And so we have precedence for states, sovereigns interacting with, you know, companies, with currencies. Look at, you know, Nevada and Tesla's Geigga factory. Look at Amazon HQ2, right? We have started to see sovereigns caponing up to the negotiating table, right, and doing deals

because more and more and more individuals, more and more small groups are getting comparable to sovereigns, right? The level of power inequality in the world has actually been dropping. The level of individual, you know, ability to accumulate capital has been rising. And this is actually back to the future. The mid-20th century was actually a barren in this fashion. So answer is, if we can get to a thousand sub societies, I think we can get a network state. And that's a goal. It's a funnel. But let's see what happens. So to close it out, biology, we have the chopping block challenge for you. Are you ready for this? in exactly six words or less, tell us your favorite crypto asset and your least favorite

crypto asset. You only have six words. You can think on it for a few seconds. Bitcoin and Ethereum 50-50. Wait, which one's your favorite? Which one's your least favorite? Oh, so I just said, 50-50. So you split, wait, so you're splitting down the middle between Bitcoin and each being your favorite? No, no, no, what I mean is basically like, So not financial advice, right? Like goes out saying not financial advice, et cetera, et cetera. But if like gun to my head, you know, someone is like, okay, you know, what portfolio, blah, blah, blah.

Like 50-50 Bitcoin Ethereum is like it's not a bad bet. Okay. Why? Because both those have massive communities. They're not going away. They have, you know, serious use cases. I think both immutability and programmability are obviously valuable, but they're also obviously. difficult to have in the same chain. You know, they're like, I don't know, the Twitter and Facebook of the space, the Microsoft and Apple of the space, whatever. Like those are there. There's tons of other really great coins and stuff, whatever I could talk about. But actually don't, this thing is I, I am pro the space as a whole.

If you guys notice, I'm not like a crypto tribalist on Twitter or what have you. I'm pro the space as a whole. I'm pro individual founders and I'm pro entrepreneurs and I'm pro developers and developers and engineers and individuals around the world who are using these platforms. And so I kind of don't want to like, quote, pick favorites or whatever, right? And I also don't want people to be like, oh, my God, Bologi said to get this coin, blah, blah, and it's not down 80%. Look, that.

It's just zero point in doing that. Could you possibly do better than that 50-50? I think you absolutely could. Do I think that that's probably like a pretty good, safe portfolio? I think so. Well, Bolli, we do have to wrap. that did not sound at all like investment advice. So thanks for sharing that with our listeners.

At the end of the day, although I know that you're a controversial figure, I know some people love you, some people hate you. You're clearly one of the most important thinkers. Much more, I believe, in the former category, I believe. I haven't taken a tally, but I assume so. We thank you very much for coming on. And anybody, go read the network state. It's an important book. Thank you, Bologi, as always for sharing your wisdom.

Thanks, everybody. All right. That's a wrap. See you guys. Hey!