Blockchain 🪄 💻

As a (Magic Internet) Computer

slides: blog.kianenigma.com

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Agenda

• Introduction
• Different perspective on what blockchain systems are
• What properties they have
• Evolution of blockchain systems
• How this information can be useful to find a good use-case

Introduction

Owning Money

• €100 worth of Bitcoin, and €100 in your national bank of choice. What is the difference?

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Owning Money

• Revolut
• ­🏦 Central Bank
• ­👩‍⚖️ Judiciary System
• ­🔫 Law Enforcement

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Owning Money

• Bitcoin
• ­🧮 Cryptography
• ­🤑 (Crypto)Economic Security
• ­🔂 Re-execution
• ­⛓️‍💥 Did you notice a blockchain is not in the list? More on that later

Somehow we settled on calling systems that utilize the above, and happen to use a blockchain data-structure, a blockchain (system)

Notes:

• Cryptography: Military-grade, politically neutral technology
• (Crypto)Economic Security: You diverge from correct behavior? You lose money
• Re-execution: A lot of re-execution of the same work by different parties

More on this in Blockchain Scalability - A Holistic Recap

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Owning Money

• ­🔫 + 🏦 + 👩‍⚖️ $\to$ Trust
• ­🧮 + 🤑 + 🔂 $\to$ Truth
  • ­aka. Verifiable trust
  • ­ "Less trust, more truth"
• ­Blockchain systems yield a truthful computer.

Properties Of The Truthful Blockchain Computer

Let's examine

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Properties: Execution + Storage

• ­Given a set of rules for the computer encoded as a code
• ­And an input to that code
• ­The code is executed correctly
• ­Any storage update by that code is truthful
• ­Truthful Execution + Storage
• ­What is the code, input, and storage in Bitcoin?

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Properties: Execution + Storage

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Properties: Auditable History + Strict Ordering

• ⛓️‍💥 Blockchain (is overrated)!
• Blockchain != Blockchain-based system

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Properties: Public

• Both code and storage and inputs to that code need to be public for other network participants to verify it
• ­🔂 Re-execution necessitates (some degree of) publicity
• ­✅ ZK-SNARK proofs? Yes, that'll work
• ­When is this desirable? Public/P2P interactions

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Properties: Digital

• Needless to say, this truthfulness only applies to the execution of the code, and its side-effect storage.
• ­Not anything else, and importantly not the real world.
  • ­Oracle Problem
• ­RWA???

Notes:

Not to say RWA tokenization is bad... But it is fundamentally using Blockchains different compared to that of DeFi and alike.

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Properties: Decentralized $\to$ Unstoppable

• It is probably harder to (forcefully) shutdown Bitcoin than Revolut
• Decentralization
  • Technologically
  • Politically
  • Geographically
  • Ideologically
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Properties: Expensive + Slow

• All of this dance to replace Trust with Truth doesn't come for free.

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Properties: Recap

• Pros:
  • Secure computation and storage
  • Auditable + strict ordering
  • Public
  • Digital
  • Decentralization: Unstoppable
• Cons:
  • Slow
  • Expensive
  • Decentralization: No support hotline

Evolution Of The Blockchain Computer

• From the point of view of the primary developers
• .. Although history tells us this leads to the user experience as well 🤭

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Evolution Of The Blockchain Computer

• Bitcoin: Domain-specific. Fixed code and storage
• 🦖 A lot of other dino-chains are similar

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Evolution Of The Blockchain Computer

• Smart Contract!
  • ­A (limited) way to extend the code and storage of another blockchain computer
• ­ Ethereum, (most) Rollups, and anything else EVM-based
• ­ Solana, NEAR, ETH-killers and family

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Evolution Of The Blockchain Computer

• How about we have multiple blockchains with different code and storage each?
• ­Polkadot / Cosmos
• ­Some Ethereum Rollups

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Evolution Of The Blockchain Computer

• How about we don't expose the blockchain to developers?
• ­Polkadot JAM, ICP, AR.IO, with differing properties

Introduction Ends

Questions?

Reflection / Discussion

• Not financial advise 😁

What Have We Solved?

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What Have We Solved

• ✅ Commoditization of digital goods
  • Stablecoins, Defi, GameFi, NFTs
  • Computation and Storage

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What We Might Solve

Note:

• RFC 2616 (Hypertext Transfer Protocol -- HTTP/1.1, June 1999)

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What Have We Failed To Solved

• The ratio of money invested in blockchains vs Products is still very tilted
• ­Why?
  • ­Some due to lack of scalability
  • ­ Some due to stickiness
  • ­Some due to lack of PMF

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Lack of PMF

• We cannot determine what problem can a technology can solve, if we don't exactly understand what that technology does.

Notes:

• Social interactions, in societies large enough when you cannot trust one another

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Why DeFi is Perfect PMF

👉 NOT A COINCIDENCE 👈

• ­✅ Social interaction, needs truthful computer as intermediary
• ­✅ Happens on entirely digital data
• ­✅ Limited computation and storage needs
• ­✅ Publicity is tolerable (thanks not having proper identity and pseudonym accounts)

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What Else Is a PMF?

• Don't hesitate to question:
  • Why should I build this using a blockchain and not put it on a Web2 server?
• Look in your day to day life for user-journeys that benefit from a system with the above technologies

Questions