Primer: Join Patrick O'Shaughnessy as he interviews Balaji Srinivasan, a serial entrepreneur and angel investor. In this interview, he shares his fascinating thoughts on a huge variety of topics, including different ways to evaluate your information diet and the rise of the network unions.
Who is Balaji Srinivasan
Balaji Srinivasan (@balajis) is an angel investor and entrepreneur
Formerly the CTO of Coinbase and General Partner at Andreessen Horowitz
Co-founder of Earn.com (acquired by Coinbase), Counsyl (acquired by Myriad), Teleport (acquired by Topia), and Coin Center.
Information diet
Tracking of food and how it affects our biochemistry
With the Internet of Things, we can now track how the food we eat affects our health metrics
With GPS, we can always know our location
In the future, we will always know if we had an infection or illness coming
What we had outsourced may have values not necessarily aligned with ourselves
In media, if it bleeds, it leads
Polarizing scissor statement, which is something that is obviously true to one party and obviously false to the other, makes people enraged, hence it keeps them engaged
At the end of the day, the media company wins because they can sell more ads and make more money
As we outsource the food that we eat to restaurants and companies that sell food, we are also outsourcing our health to these entities that are not economically aligned with us
In social media, a lot of things are consistent repetition rather than independent replication
Imagine in the future, just as we can track how the food we consume can affect our biochemistry, we can also track how the content we consume can affect our behaviour
This means that media companies will have all the incentives to put up polarizing news to feed to us
Just as we have to be careful with who we outsource our food, we also have to be careful with who we outsource our information feed
The Russell Conjugation
It is this idea that the same thing that happens to different parties can be painted in a positive, mild or negative light
E.g. I sweat, you perspire but she glows
Or I am detail-oriented, you don't let anything past you, he is a nitpicker
The non-obvious thing is that The Russell Conjugation is a way to embed a hidden org chart in language
E.g. Media paints a negative light on Zuckerberg for having dual-class shares on Facebook, but the same media celebrates Sulzbergers (owners of the New York Times) for having dual-class shares in their company
Important to deconstruct and point out the double standard of languages used
How to have an information diet?
The best way is to build a better alternative
With blockchain, there are no doubts about the truth of a transaction once a block is confirmed
Extending this, once information is recorded on-chain through some oracle services, there will also be no disputes on the information that is presented by the media
It will be much harder to falsify and mess with
Eventually, even companies can be evaluated based on how good their on-chain data metrics are
Informational supply chains
With on-chain data, we can trace the information supply chain right up to its origin
In academia, there is a concept called reproducible research where the code and all the data unpinning the graph are all published
This allows another person with the same data to reproduce the results and do independent diligence on it
Another concept is called open access where if a research is paid for by public funds, it should have public access
All these can be done easily by putting everything on-chain, thus truly getting a permalink with timestamps that can prove that the originator of the data was the first
This can also create on-chain libraries where other people can import for their research
Thus forming an actual academic supply chain where one can trace the etiology, the origin of a fact or an assertion all the way through the literature
Crypto is economic mathematics
There are things where you can only learn effectively from scatterplots after collecting enough data points
If the data is on-chain, other people can independently replicate the results from the same source, leading to better science
Not everyone can independently replicate science experiments because of the equipment, but with home computers, everyone can do that with math
Reproducible experiments can be done for science, but not so for economics, hence it is debatable if we can call it a science.
"Macroeconomics, until very recently, was not subject to experiment. Basically for the most part, the only thing you could know about macroeconomics is communism didn't work. In a similar spirit, if the whole ramshackle structure of contemporary macroeconomics vanished into thin air, and the field had to be reconstructed from scratch, the sentence, which packs as much of the discipline into few as possible words might be, governments are not households."
- Balaji Srinivasan
Cryptocurrency is essentially economic mathematics and reproducible with computers
You don't have to trust and rely on the priests of macroeconomics or trust the CPI for inflation statistics give by them because you can pull out the data yourself if everything is on-chain
The entire history of an economy can be replayed on your laptop and subjected to inspection
Just like Martin Luther did with the Catholic church where he sees that the institution is ossified and incompetent, we have to decentralize the establishment to start a new one
Dissolving of nation-states and the rise of collectives
Physical distance < Social distance
Observed that Twitter profiles have emojis and hashtags signalling tribal affiliation where geographic distance matters less than the social distance
Nation-states have borders because people are physically close and have the same culture but this is all going to break apart because now, we could be culturally, ideologically and morally closer to someone far living far away
Instead of physical borders, we now have digital borders and that is what the tribal affiliations are about
Following this, there will be great migrations made collectively by individuals, called the concept of Crowd Choice where consent is being optimized
Crowd choice and network union
Once the online social group grows big enough, and that people are closer ideologically than their neighbours that live physically close, collective bargaining can be made with governments, thus forming a network union
E.g. If a person from the network union got deplatformed, the union will tweet together and lobby to get him back
The union can become sovereign and thus become an internet native form of governance that you can opt-out if you want
A network union will have its own hierarchical structure, a defined leader, an integrated cryptocurrency and a sense of purpose
With a leader, you can focus all the energy of the people on one singular purpose to effect changes that are of value to the group and also to the individuals
Instead of having a two-party system of Republicans and Democrats, we will have a system of n sovereign city-systems all competing with each other on different criteria to attract people to stay
Collective social media
Social media is currently a bunch of individuals optimising likes and follows
People who are advancing an ideology are often having in-fighting among themselves because they don't have proper on-chain metrics
They are playing the Twitter zero-sum game and instead of consciously angling for influence within the tribe by showing proof of work with provable on-chain actions
It will be interesting to see collective social media combined with crypto, where a group of people band together to advance the tribe they are in with a collective dashboard instead
Recipe for a successful startup city
How to start a new city
Build a community in the cloud, organise the economy around remote work, enforce laws with smart contracts, practice in-person norms of civility, simulate architecture in VR, crowdfund territory and materialise city in the real world
The key is to go to the cloud to build a community first and finding the land last
"The minimum number of people who can stop you from doing something is the degree of bureaucracy."
- Balaji Srinivasan
Founding vs inheriting
Inheriting an institution that takes multi-generations to form means that the inheritor is a ceremonial role
The heir is likely to be professional managers who are good at repeating but could not create from first principles, hence could not adapt to new situations
The US government bodies are failing at every stage during the covid pandemic because the whole institution is run by ceremonial people
"So the point is that this heir was repeating. They could not create. This is the same as somebody who grows up in a household and they may hear a language, but they can't speak it. There's cultural artifacts that surround them and they kind of copy them, but they can't create them from first principles. And if you cannot create, well, that's read only culture. You can't actually rebuild. You can't reinvent in a crisis. And that's what happened to America. All people could do is come up with slogans."
- Balaji Srinivasan
An election is optimised for legitimacy but not necessarily for competence
In that sense, maybe a dictator will be more competent because he can cut through all the layers to get to the root of the problem
An interesting observation is that a lot of people think that a political leader is very important but a corporate leader is not
CEO is completely dispensable but somehow this view is not extended to political leaders
Balaji thinks that both political and corporate leaders are important
Everyone becomes an investor
In the 1800s, everyone was a farmer. In the 1900s, everyone was in manufacturing. In the 2000s, everybody becomes an investor
It's very easy to become a content creator now and you can actually make money from this because we are moving from social networks to truly digital economies
However, not everyone is going to be able to do due diligence on their investments, so they will follow influencers, sort of like choosing a boss in a traditional company
The influencers will have an on-chain track record, so followers can verify the claims they make on their returns
In the past 99% of the people are labour and only 1% is capital
In the future, 99% of the people will be investors but only 1% of them will be founders who can turn the capital into actual things like a spaceship or an electric car
Actionable things to do
Buy Bitcoin, and if you're feeling more adventurous, buy ETH
50% BTC and 50% ETH and just don't care about the price for the next 5 to 10 years
The most obvious thing to do is to own cryptocurrency to prepare yourself for significant financial and monetary disruption
Optimise your sleep with a good mattress
33% of your time is spent on sleeping so do not skimp on one
Health
Do intermittent fasting like OMAD - one meal a day - or only eat within a specific window
Basically do calorie restrictions
Can listen to David Sinclair's podcast for longevity stuff
Have a home gym, especially during covid
Prioritize health over work
Wealth
Check out teleport.org to find out about places where digital nomads can live in
Work remotely and minimise consumption by getting out of big cities
Curate your information diet
Every once a while, draw a pie chart to see how you are spending your time and how you want to spend your time
Need to achieve individual financial independence to achieve ideological independence in order to achieve collective independence
Then you can start being a founding influencer to gather your tribe with the same sense of purpose to do bigger things
The kindest thing someone did for him
In high school, he was a smart ass, so he was kicked out of his physics class because he was basically trolling the teacher by asking questions
A kind administrator allowed him to take an independent study module on physics so that he wouldn't fail the course but he also does not have to attend the class
He ended up studying all the physics and math that he wants at his own pace
This made him learn how to self bootstrap
Realised that he can actually learn faster out of school and helped shape his thoughts on things
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