The Metaverse Podcast - Connected Blockchains, with Ethan Buchman of Cosmos
Primer: Ethan Buchman, the Co-Founder of Cosmos, takes listeners through a philosophical ride on politics, economics, the hyperlocal, and cooperatives. Learn about the problems that corporations afflict on society and how blockchains and a multi-scale infrastructure that bridges the hyperlocal and global could make our society a better place to live in.
Background
Co-Founder of Cosmos
CEO of Informal Systems
President of the Interchain Foundation
Has a background in biophysics, machine learning, neuroscience, statistical inference and complexity
Always thought that he would become a professor. Decided otherwise after he learned how corrupt academia is
Stumbled onto Bitcoin and the open source community and saw how all these disparate fields are coming together
Cosmos
Internet of blockchains project founded in 2017
Grew out of the Tendermint project
In 2016, Jae Kwon and himself, the two Co-Founders of Tendermint and Cosmos, envisioned a world with millions of blockchains
They saw the need for the different blockchains to be interoperable with one another — this was the crux of the Cosmos project
The Inter-Blockchain Communication (IBC) protocol went live this year and they hit a milestone of a million IBC transactions last month
"So the idea of there being a proliferation of blockchains, you know, thousand, or millions of blockchains was still kind of heretical, and everyone was trying to build the one true chain, it was gonna be Bitcoin or Ethereum or something else. And we saw a world where there would be many blockchains." - Ethan Buchman
The Interchain Foundation
A non-profit foundation set up in Switzerland in 2017
After they had written the Cosmos whitepaper, they set up a foundation to raise money to fund the development of Cosmos
Goal is to steward the creation of this interoperable, sustainable, community-owned ecosystem
It's still operating today and employs a number of core developers and funds dozens of other projects in the ecosystem
Informal Systems
A company that spun out of Interchain Foundation at the beginning of 2020
He's the CEO of Informal Systems
Informal Systems is a core contributor within the Cosmos ecosystem. They do fundamental R&D on Cosmos protocols and is one of the lead developers of the IBC protocol
They have built Hermes, which is an IBC relayer that connects blockchains together
They build tools to enable software developers to get higher guarantees out of their software
Started doing security audits this year
They also run a proof-of-stake validator
They are structured as a workers cooperative
Why Are Cooperatives Important?
Historically, a lot of the institutions that are built around modern civilization were kind of accidental
The corporation as we know it today came together in the 19th century through a series of laws that made it possible for anyone to get incorporated and limited liability
"We kind of bumbled their way into them, you know, they happen here, a law showed up here or there, some economist had an idea and lobbied the government for something, and then we ended up with some institutional structure." - Ethan Buchman
We rapidly ended up structuring our civilization on top of corporations
The problem with corporations is that it insufficiently represents the stakeholders in society
Even the legal system is biased to favour shareholders and to return profits to them
Have observed the destruction wrought by unaccountable multinational corporations
Cooperatives do it better by embedding other groups of stakeholders in the governance structure
Have a model in mind where we have more cooperatives in society
On Cybernetics
Reads cybernetic literature
Was heavily influenced by Buckminster Fuller, Marshall McLuhan, and George Lakoff
His Twitter Bio
Has put "Internet Biophysicist. Sustainability Existentialist. Monetary Localist." in his Twitter bio. Made all these things up so as to prevent people from putting him in boxes
In his 20s, he was trying to derive physics from politics. In the 19th century, a lot of people were doing this and they came up with Social Darwinism
The Sustainability Existentialist disposition comprises of the following concepts:
The emergent systems in the universe seem to contravene the second law of Thermodynamics. Entropy is always increasing. Hence, corporations have ended up becoming so dominant
We also have organisms and ecosystems that seem, at first glance, to contravene the second law of Thermodynamics. However, when we study them further, they don't actually contravene the second law. These organisms/ecosystems are able to produce sort of more dissipation overall than if they didn't exist
"And so that sort of idea that a sustainable system is one that effectively represents its environment inside its internal structure in order to store up energy and respond effectively to changes in its driving signals. That's sort of the crux of my philosophy." - Ethan Buchman
Creating local organizational forms could help to reduce complexity in society
Blockchain enables a revolution in coordination that is built on top of a communication layer. It is able to address many of these systemic problems in society
How Does A Blockchain Of Blockchains Resolve The Tension Between Free Market Fundamentalism And Collectivism?
Thinks that dichotomy is a bit misguided
Markets have a really important place in the world. The problem is a completely market-oriented society because that would corrupt the values of land and labour
Blockchains help to restructure the conversation and to make people think about what money is
The concept of money suffers from the same problem as land and labour. People think of them as commodities
"I think the key idea is that markets have their place, but they need to be used for actual commodities for things that can be meaningfully subject to the laws of supply and demand. Labor, land, and money aren't actual commodities, they're so called fictitious commodities. When we try to subject them to the whims of the market, we misrepresent their actual value." - Ethan Buchman
Need to have the correct institutional forms which should be bottom-up, local, and governed by cooperatives
This is embedded within Cosmos' philosophy — sovereignty and interoperability. Communities have sovereignty over their own infrastructure and applications that they use and still remain interoperable with other chains
In the early days, they pitched Cosmos as an application specific blockchain. This is held in contrast to Ethereum where users are not sovereign:
It's run by Ethereum miners
It's subjected to the Ethereum Virtual Machine
It’s subjected to the whims of Ethereum governance and upgrades
Users of apps on Ethereum are not sovereign over that particular app. They are subjected to the larger political economics of the Ethereum network
"Just like there are a lot of benefits to being ruled over by the empire of Alexander the Great, he takes care of your security and a lot of things and will protect you, but you have to pay taxes, and you may get drafted into the army and things like this, right. And so the idea with Cosmos was to enable each application to really be its own sovereign blockchain in its own right." - Ethan Buchman
With Cosmos, each blockchain determines its own parameters without being subjected to the whims of other networks
What Industries/Verticals/Use Cases Is He Seeing That Benefits From This Kind Of Network Configuration?
Plenty of Cosmos-based blockchains are specializing in certain aspects of DeFi and payments
Terra and Crypto.com, which are Cosmos-based chains, have very active, widely adopted retail scale payments infrastructure
Is interested in sustainability. Some Cosmos-based chains such as Regen Network and IXO Blockchain are tackling this issue
Althea network is running real world, mesh net infrastructure in rural communities
"The Cosmos technology sort of applies equally well to both, whether your community is at the level of a small rural town that just wants to provide its own internet, or it's at the level of the entire globe trying to heal the planet. The coordination technology is useful at all scales." - Ethan Buchman
How Do People Differentiate Whether They Need A Blockchain Or A DAO On A Blockchain?
Depends on the needs of a particular community as to whether a smart contract suffices or if it needs their own blockchain
Annoyed with the whole DAO discourse. There's so much tooling that's missing to make DAOs work. They will be addressing some of these issues with Cosmos technology
Sees the end game as some sort of sovereign interoperable city states, with each city running its own blockchain
DAOs And Blockchains
Each blockchain is, in some sense, a DAO
Each blockchain will be more representative of its users and be owned by its users
Many DAOs are being formed, but they don't have anything to govern
Thinks that there should be more DAOs that focus and support real world economic activity and infrastructure
Need to have a multi-scale infrastructure, with the right infrastructure at each scale to bridge the gap between the hyperlocal and the global
Thoughts On The Metaverse
Does not think of the Metaverse as an economic Metaverse because it ends up hiding all the politics that make it work
It's not just hyperlocal, it needs amalgamations of localities to properly represent the global as some kind of cooperative
Bitcoin tries to be purely economic, but has heavy political elements to it as well
Books Recommendations
The Great Transformation by Kyle Polanyi — How capitalism emerged, what are its roots, and the concept of fictitious commodities
The idea of land not actually being a commodity and the rules of private property should not apply to it
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