Tag: vitalik buterin

8 thought leaders on the intersection of AI + crypto — Fred Wilson: “AI and Web3 are two sides of the same coin. AI will help make web3 usable for mainstream applications and web3 will help us trust AI”

I posted the original thread here:

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Fred Wilson

AI and Web3 are two sides of the same coin. AI will help make web3 usable for mainstream applications and web3 will help us trust AI. Together they will lead to a more powerful, more resilient, more trusted, and more equitable Internet

https://avc.xyz/what-will-happen-in-2024

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Vitalik Buterin

It’s a reasonable question: crypto and AI are the two main deep (software) technology trends of the past decade, and it just feels like there must be some kind of connection between the two. It’s easy to come up with synergies at a superficial vibe level: crypto decentralization can balance out AI centralization, AI is opaque and crypto brings transparency, AI needs data and blockchains are good for storing and tracking data.

https://vitalik.eth.limo/general/2024/01/30/cryptoai.html

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Arthur Hayes

“Any company that can be attacked in the analogue human legal field will be attacked by those who believe a for-company-profit AI implementation used their data without payment,” he continued. “It is an impossible problem to solve — how do you adequately pay every entity for their data?”

“The only way to create AIs as economic entities is for the ownership to be dispersed wide and far, such that there is no single centralized structure to attack in the traditional legal arena,” he added. “The market will quickly come to realize the entire lifecycle of an AI must be decentralized, which will in turn benefit networks such as Ethereum. Ethereum is the most robust decentralized computer in existence, and I fully expect it to peer power the future AI / human economy.”

https://www.theblock.co/post/271501/bitmex-co-founder-arthur-hayes-joins-decentralized-ai-platform-ritual

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Casey Caruso

Since computational strength grows with resource consolidation, AI naturally fosters centralization, where those with more computing power progressively dominate. This introduces a risk to our rate of innovation. I believe decentralization and Web3 stand as contenders to keep AI open.

https://www.caseycaruso.com/thoughts/decentralized-ai

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Crypto, Distilled

Divides the web3 AI stack into: Agents, AI analytics; Authentication; Privacy; Data; Compute; Models

Blockchain = provable fairness; AI = unparalleled productivity

https://x.com/DistilledCrypto/status/1753300276298289169?s=20

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Travis Kling

AI is a clear opportunity for crypto, but I am wary about crypto’s ability to execute on that opportunity this cycle

https://twitter.com/Travis_Kling/status/1753455596462878815

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Varun Mathur

Centralized AI entities have consolidated immense power, regulatory capture, and using their growing network effects, there now exists a period of at most a year, before they cannot be competed against. The world they present to users is that of biased and limited interfaces, where the $20/month “pro” features are far outside the reach of say a college student in India.

https://twitter.com/varun_mathur/status/1754305144630440089

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Binance Research

Funding for AI-related web3 projects surged in 2023, reaching US$298M. This is more than the collective funding amount raised for AI projects from 2016 to 2022, at US$148.5M.

Areas of note: DePIN; Zero Knowledge; Consumer dapps; Data analytics

https://www.binance.com/en/research/analysis/ai-x-crypto-latest-data-and-developments/

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Venkatesh Rao

AI+blockchains point to a dystopia of impersonal and faceless interchangeable-parts humanity that’s more industrial than the industrial age.

https://studio.ribbonfarm.com/p/brains-chains-and-vibemobiles

Bankless podcast notes – Vitalik Buterin on Ethereum in 2023:

Discussion based on this article: https://vitalik.ca/general/2022/12/05/excited.html

2022 accomplishments:
PoW>PoS reduced energy consumption by 99%
faster, more consistent block confirmation times – every 12secs
ZkEvms – multiple implementations with mainnet launch in 2023
Sign-in with Ethereum adoption (Farcaster, Lens)
Russia invasion of Ukraine – crypto proven to be useful
Continuing adoption in LatAm (eg, Argentina)
Crypto as international payment system for philanthropy

Post-peak price is often when major innovations launch (eg, Ethereum itself, Uniswap, PoS transition)

MtGox was, in a way, FTX of first cycle – but Mark Karpeles has proven himself a responsible actor in aftermath unlike Su Zhu and Kyle
But back then, MtGox implosion felt like existential crisis for bitcoin, for legitimacy

2023 will be year of rollups, Ethereum in its “scalable era”

Crypto no longer in 0.1—>10% stage
Now it’s about 10%—>70%, requires new strategies – eg, can’t keep losing $5B in hacks

Esperanto is failure case
A constructed language in 19th c – easier to learn because simpler spelling, more regular grammar
Hope for path to world peace, everyone can speak same language
Didn’t succeed – just enthusiasts, niche community
Beautiful technical properties – but adoption went nowhere

Linux is middle case – kind of succeeded, kind of hasn’t
Linux desktop is mostly a failure – very usable but low adoption
But lots of backend adoption – eg, Android and many servers run on Linux

Internet is big success case

Will Ethereum / crypto end up as Esperanto, Linux, or the Internet?
Probably not Esperanto but possible that it’s between Linux<->Internet
Possible that adoption bifurcates between developing and developed countries

If good people are passive, the things that win will be drama queens of the world – we need to drown out the drama queens

Vitalik intentionally using the word “crypto” less and “Ethereum” more
Crypto is ungovernable commons with no barriers to entry – but just because you’re “crypto” doesn’t mean Ethereum is your partner or ally

IOTA, XRP – still completely centralized, but they’re still on Coinmarketcap
XRP wrote documents to US government accusing BTC and ETH of being China controlled

Cosmos ecosystem – deeply respect it
One of few genuinely trying something different, modularity, different design space, have a technical vision, have not been pump-and-dumpy
DH: even though Terra / Luna was built on Cosmos, no one blames Cosmos for its failure

Others Vitalik respects: Zcash, Bitcoin (decentralization ethos)

2022 lessons learned:
-crypto at its most honorable when it takes core principles seriously (decentralization, self custody, transparency)
-some apps that grew quickly tried too hard to integrate w/ mainstream, and compromised their values
-what’s succeeded: Uniswap (DEX); Rai (stablecoin); ENS
-privacy tech hit a speed bump

5 use cases that excite Vitalik:

1 – Money – charitable donations; investing in startups; crypto as frictionless international money
Even if CBDC is adopted, likely hard to use / transmit across borders
In developing world, crypto is easiest way to send money home to families, to store value
Developed world activism or industries at risk of de-platforming (eg, adult content)
Make a wallet that 1B people use

2 – Defi – most important are the most simple use cases eg, stablecoins, DEX, prediction markets (stuff that’s been around for longer)
Newer stuff is very complicated, yield farming, high APR/APY, short-term focused
4 years ago even the ponzis were more honorable; now there’s a lot more obfuscation going on
Make a stablecoin that can survive USD hyperinflation

3 – Identity – authentication; attestations; domain names; ENS; proof of personhood
Don’t think identity focused blockchains will work
RSA: Identity is emergent, a byproduct of what you’re building (eg, Facebook is useful and ID emerged, same with Google / Gmail)
ETH wallets vs PGP keys – PGP used to be strongest cypherpunk meme, now ETH wallet just works and is being adopted and is public/private key pair – possible bc big username
Standards emerge over time – eg, POAP as attestation protocol
Crypto is not just product, but also a community

4 – DAOs – set to replace things other than corporations (which are big and need the infrastructure);
Where DAO makes sense
-Quickly spin up multi-sig of 7 people
-Setup a truly decentralized org that is resistant to attacks
Less bullish on DAO as VC fund
How to setup non financial governance? How to resist 51% attack from token holders?
eg, Maker has 7B in capital (TVL), but governance token is only worth 500M mcap – could buy up token and get access to capital

5 – Hybrid apps – partially onchain; more centralized services
eg, Centralized exchanges with proof of reserve attestations, or games / social media that post occasionally to chain
DH: similar to L2s post data to L1 that forces them to play by set of rules
DH: Blockchain is a check on human folly

How do we achieve this?
-continue interacting with regulators
-give grants to enable builders working on important problems (eg, self custody wallets)

What is Vitalik’s role in 2023
Helping projects, explore app space, ETH protocol stuff, push EVM in good trajectory, connect with various ETH communities around world, helping ETH ecosystem be stable and self-supporting
Rumor that he wants to turn “gas” into “mana” – he even proposed splitting gas into several types of gas, and naming one of them mana

Podcast notes – Vitalik Buterin talking post-merge on Epicenter: “Core devs want role to be as technical as possible”

Podcast notes – Vitalik Buterin (After the ETH Merge) – Epicenter

Host: Friederike
Guest: Vitalik

50% of blocks are OFAC compliant – “it’s a concern…but important not to overstate it”
Means non compliant transactions have to wait 2 blocks instead of one (on average)
Near-term solution – MEV boost will have transaction inclusion lists added – similar to what MEV-Geth (?) did before
Social slashing is a meme that’s gone too far – shouldn’t hard fork to delete censoring validators
“Optimistic that things will improve quite a bit”

Should validators have agency?
General idea is to make validators as dumb as possible – just run code – maximally dumb pipe-y – more predictable and easier to run a validator
Argument for making validators smarter / opinionated – could serve as second line of defense

Doesn’t trust threshold encryption – requires 50% honesty assumption
Suspicious of honesty majority assumptions – should have paths to recovery if dishonest majorities occur

MEV smoothing – Justin Drake’s fave idea – treat non optimal bid acceptance as invalid / non availability condition

How much of a problem is MEV?
Many kinds of MEV – some is a problem, some isn’t
One class of problem – outright exploitation (eg, Uniswap ETH-USDC, sandwich attack)
Some MEV is unavoidable / benign – eg, arbitrage if prices change during block confirmation, keeps prices synchronized
Don’t want proposers to need to update software to keep pace with MEV algorithms
Can’t count on dapps to mitigate MEV – “always gonna be dumb devs somewhere”
There are MEV minimizing architectures – eg, off chain order matching before sending to Uniswap / onchain DEX

Some (eg, Paradigm) argue MEV inevitable – and thus building solutions to capture MEV in somewhat decentralized way is necessary (eg, Flashbots)
Flashbots has prevented centralization of layer under them (the stakers) – but has turned into centralization vector itself

The Surge – danksharding requires trusted setup, should we worry about it?
Low probability (1 of 1000s?), but important to move away from trusted setup over time
Other approaches have too many tradeoffs
KZG now, roadmap for removing it as better snark tech catches up

Phase 1 – Proto danksharding – could be early to mid next year
Phase 2 – go to 16mb, split up data load – will be gradual nodes transition

Core development bandwidth limited, prefer solutions that are more distributed / third party
Examples: Account abstraction strategy – 4337; Rollups
Danksharding – benefit is split off development effort, core devs have simpler problem / less work, rest of work is on community, can get something out much faster

Concept of in-protocol fees going to specific dev teams – has been discussed before and rejected – trying to minimize governance
Core devs want role to be as technical as possible, avoid social value judgments
If can go back 8 years, pre-mine 3M ETH for long-term fund for soul-bound governance, maybe — but need to live with ecosystem as it is today

Centralized chokepoints in L2? Sequencers are centralized
Decentralizing sequencer is very important – multiple approaches and tools, balance complicated constraints (security, legal)
-In-protocol auction to buy up sequencer rights for future slots
-In-protocol proposer mechanism

$3B in hacks in 2022 alone – how do we protect normies?
Defi hacks have been in applications he doesn’t use and would never endorse using
Some in community have more aggressive ideas of what they wanna do onchain and will overshoot
“Best we can do is slowly expand frontier of what can be done safely over time”
Uniswap safe for long time, MakerDao, better DAO governance contracts – this safe space will grow
“Do better job of communicating difference between safe zone and crazy zone”

What must we get right in 2023?
“I’d still say scalability…there’s a limited time window”
If we don’t solve by next bull market, overwhelming chance that forms of scaling that sacrifice trustlessness will dominate, will be hard to come back from it