Joe Lubin speaks about his vision for a decentralized world and the role Ethereum and ConsenSys play in it, what most people misunderstand about Ethereum, why it is hard to imagine what blockchain technology will do for us in 2025, why silos are coming to an end, how hierarchy and decentralization go together, what the blockchain space needs to become more trustworthy, which skills are relevant in the decentralized future, and what he would be doing if Ethereum and ConsenSys didn’t exist.

Joe is the co-founder of Ethereum and the founder of ConsenSys, which is “a global formation of technologists and entrepreneurs building the infrastructure, applications, and practices that enable a decentralized world.”

Transcript of the interview

Manuel Stagars: What do people most often misunderstand about Ethereum?

Joe Lubin: It’s a big, complicated, sophisticated project. Maybe the main misunderstanding is that people in the space and outside of the space try to map it onto the way corporations operate right now. The Ethereum Project is a massively decentralized project. It’s essentially an open source project and platform. Decision-making is a big, fuzzy, hairy, and messy thing. There are many leaders on the project. Vitalik [Buterin] is an outstanding driver of the technology, an outstanding research scientist, and an individual of great integrity and great decision-making capability who sources and weights opinions and makes his own decisions. I’ve never seen him tell anybody what to do, and I haven’t seen him often make decisions for the project. Decisions are made by consensus, and there is a process by which proposals are commented on and voted on by people who implement things. If there is sufficient popular opinion, proposals make their way thought this arduous process and into the clients. Even if they get into the clients at times, as we saw during DAO event, the software developers gave the people downloading the software a choice of which of the forks they could choose to activate on their particular node. The biggest misunderstanding is that there is nobody in control.

Manuel: There’s nobody in control, and everything is decentralized, even decision making. Perhaps the whole idea of a decentralized world is hard to understand.

Joe: I guess that’s true. We have different degrees of decentralization among different systems. Ethereum is no top-down command-and-control infrastructure. That is unusual for some people, but it’s an architecture that makes more and more sense. We have great communication mechanisms right now around the world, and we have tools that can enable us to come to decisions among a group of actors even if up to half of the actors are malicious. These blockchain systems can enable that sort of decentralized collective decision-making. We’re building tools on top of those protocols, such as voting systems, liquid democracy for delegating votes, or futarchy. We’re going to see a lot of experimenting with different mechanisms, and we’re doing some of that at our company [ConsenSys]. The age in which we need to organize things via top-down command-and-control and hierarchy is dissipating somewhat. Those are still good mechanisms in many contexts, but those mechanisms are most effective when communication is slow and expensive and decision-making is difficult. Today, we’re often in contexts where we don’t have these sorts of constraints anymore.

Manuel: That world is maybe slowly coming to an end.

Joe: Absolutely, but even within decentralized organizations, there are good uses for hierarchy. There are good uses for increasingly abstracted representations of information or fluid hierarchies where you have role systems that form for a specific project. As long as you don’t have a rigid structural hierarchy where people can lock in power in silos, and as long as these things are able to fluidly construct themselves, dissipate and reconstruct themselves for different purposes, I think you’re fine.

Manuel: Imagine that all these visions you have with Ethereum came true. How would you describe some of the main characteristics of that new kind of world?

Joe: On the permissionless network side of things, it would look like a decentralized World Wide Web. We have full control over all aspects of our identity. We can monetize those we wish to, and we have much greater agency—economic, political, and social. For our economic or other lives, we can participate in protocol-based open platforms, and we don’t need intermediaries to facilitate transactions for us. We can occupy different roles on protocol-based open platforms in situations that we care about, like maybe in the music industry on UJO Music, and make a living that way, or we just get greater satisfaction from participating through our own greater agency.

Manuel: If we went forward to the year 2025 and looked back, what do you think might we have underestimated and what might we have overestimated?

Joe: 2025 is pretty far away, and it’s definitely hard to figure out all the ways of using this technology. Essentially, when a new technology becomes established, the early uses of the technology reflect the uses of previous generations of technology. TV is invented, and people stand up in front of the camera and do radio plays. We’re going to use this new technology and we’ll poke at and explore dimensions that are obvious to us, such as tokenizing assets, voting, creating fair randomness, or gaming systems that are provably fair. Those are just cute additions to current paradigms or enhancements of current paradigms. We don’t really know what is going to be constructed by creative people ten or so years from now. It’s a bit of a cop out answer. If you look at how web technology ramified between 1989, when it was invented, and 1999, when normal human being were using email, I guess you could have extrapolated from there, but you couldn’t extrapolate to people sending 140 character messages, dating online, getting into a stranger’s car, or sleeping in a stranger’s home, where these would be common mechanisms in society in a couple of decades.

Manuel: It’s definitely hard to imagine what’s possible.

Joe: We have lots of speculations of what’s possible. We’re going to tokenize virtually everything. We’re going to have deep liquid markets for tokenized everything. We’re going to be able to trade many different assets against many other assets. We’re going to have fluid buying and selling mechanisms, where all we do is decide we want to buy this thing and our smart agent wallet will figure out which tokens we want to get rid of first and use those to buy things. We’re going to have data markets. We’re going to have sensors feeding those data markets. We’re going to have my utterances, my personal information, signals coming of my body feeding those data markets. We’re going to be in greater control of those things and have greater agency in how those things are used. I think we’re moving into a world where silos dissolve significantly—information silos, power silos, and transactional silos. A world where free markets will be pervasive; free markets for data and virtually everything.

Manuel: Which is a good thing in many events, but if you look at the other side, why would such a decentralized world not be a good idea?

Joe: I can’t think of any reasons why a decentralized world wouldn’t be a good idea. I think any technology can be used for nefarious purposes. Technology that is open and accessible will have bad actors drawn to it, but will also have good actors drawn to it. We’ll have the ability to create self-regulatory mechanisms that can police bad behavior. For instance, right now, if I want to issue shares in a company and sell those shares to naïve grandmothers, I can do that. I set up a bucket show, I start making phone calls, and that’s a difficult activity to track down and police. I can do traditional police work, and the SEC and law enforcement take care of those situations. We have many great token launches going on in the world, but there are also many bad and fraudulent projects. We’re at the start of that ecosystem. As we evolve in that ecosystem, it’s going to become necessary to release a white paper and to release certain significant pieces of data about your project to get anybody to pay attention to it. In the context of global access to that information, low barriers to going out and collecting that information, I think we would be able to create much better, self-regulatory systems to crowd-police that sort of activity. If you’re not disclosing all the relevant data, and if you aren’t well received by an incentivized set of actors who are sharing their analyses, then you’re not going to be relevant in the token launch space.

Manuel: What is a skill that is important for people to have to be relevant in the future?

Joe: If the thesis is that various technologies will ramify on systems in the future and blockchain technology is one of those profound technologies, then it’s going to be everywhere. We are going to need people with all sorts of talents from software development, legal, marketing, and so on. I think it represents a shift in how society will operate. In 1989, we all lived our lives very differently. We have adapted. Many of us had similar skills, like in the legal profession, and we’ve had to upskill ourselves and understand how these new systems work. We’re still essentially doing some core classes of activities, and I think we’ll continue to do that. Certainly, as we move toward a world in which software undergirds lot of our activities, it’s all about creating appropriate user interfaces so that the human being can operate on their terms and the software facilitates what we as humans want to do together.

Manuel: If Ethereum and ConsenSys wouldn’t exist, what do you think would you be doing?

Joe: I would do what I’ve been doing all of my life: Read about technology, build technology, and I would probably sleep more.

Related Episodes and Posts