Chris Dixon - Crypto Networks and Why They Matter
https://www.youtube.com/watch?v=2wxtiNgXBaU
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Crypto develops in cycles that appear chaotic but there is an underlying order.
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People come in because of trading, start to get interested, have new ideas and create new startups/projects.
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Developer activity gets sustained even if the price goes down.
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Each cycle the design space widens a bit.
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Normally think of price as a lagging indicator, but it's weird in crypto. Price feeds back into the fundamentals.
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Waves of interest and activity.
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Blockchain with a token can be generalized to a lot of things.
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Every 10-15 years, there is a new era of computing platforms.
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Blockchains are a new type of computer.
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System like ethereum provides a way to store data and operate on that data.
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Blockchain -- A virtual computer that runs on top of a network of physical computers that provides strong auditable guarantees that the code it runs will continue to operate as designed.
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Any other computer pre-blockchain, either you own the computer or renting it. No trust.
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Blockchain subverts the governance.
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Establishes trust in a way that doesn't exist in current way
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Computers that can make commitments.
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Bitcoin commitments
- Fixed supply
- No double spend
- Your bitcoin is yours
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Anything else before bitcoin needed you to trust government or scarcity of precious metals.
Blockchain computers - Architecture
Nodes
Nodes are the method by which anyone - without needing permission - can join the network and become part of the computer.
Each node runs code required to make the system function. Nodes are incentivized to behave honestly, but the consensus mechanism enforces correct operation of the entire computer even if a significant number of nodes misbehave.
Consensus mechanism
The consensus mechanism aggregates the "votes" from the node and determines the correct operation of the blockchain computer.
The rounds of voting are broken into blocks which are then chained together. A well designed consensus mechanism gives mathematically provable guarantees about the trustworthiness of the computer as a whole.
Memory and operations
The result: trust guarantees
The trust guarantees of the computer gives you ability to build credible things you couldn't with old computers. Digital money, digital goods, DAOs. Vote on twitter or facebook to decide the rules of the platform, the privacy of the data etc. Currently it's in the control of random PMs in super corporations.
- Comparison with smartphones -- There existed smartphones, but what the iPhone changed was that you could build on that. Didn't have to be a GPS expert to build a location based app. Similar place in blockchain computers right now, very early.
- Weaknesses like being slow etc can be fixed at some point. Early PCs cost 5000 USD in today's dollars, couldn't do much. These things get fixed.
- Strength is the provable trust guarantees. Equivalent in smartphones -- GPS, camera, cellular connectivity. Took people time to figure out how to use these, same for blockchains.
- Ethereum is a general purpose computer. Bitcoin is a application specific computer. (iPhone vs Blackberry, Apple Watch vs Fitbit)
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