Interview, Podcast
Effective altruism, blockchain, & better ways to fund public goods | Vitalik Buterin (2019)
- The proof-of-stake upgrade for Ethereum 2.0 is expected to launch very early next year, with sharding anticipated to eventually enable the network to process tens of thousands of transactions per second.
- Fundamental proof-of-stake concepts are viewed as theoretically sound, with practical risks categorized as isolated edge cases rather than showstoppers.
- Technological advancements in decentralized exchanges and multi-signature wallets are expected to improve, making the elimination of centralized exchanges more feasible over time.
- Zero-knowledge proof protocols are projected to become significantly faster and computationally feasible within a few years due to increased investment.
- Quadratic funding mechanisms are considered potentially transformative for public goods provision if implemented with a sufficient matching fund pool, with potential applications in supporting poor communities using a few million dollars for seeding.
- Robust identity systems capable of preventing collusion in governance are being targeted for development over the coming years, with broader challenges of collusion and identity theft expected to be addressed through experimentation and iterative improvements over the next five to ten years.
- Decentralized oracles are anticipated to improve over the next couple of years through iteration and increased participation, though security will continue to scale with the market cap of associated tokens.
- Prediction markets and security deposit-like mechanisms are expected to see broader application once trust and security issues are resolved.
- Blockchain technology is anticipated to facilitate credible international commitments, such as escrow programs for peace where funds are returned only if no war occurs, and to create impact bonds for public goods with universal recognition valued 20 to 50 years in the future.
- Ethereum is expected to evolve into a philosophical community focused on long-termist ideas and existential risk reduction, driven by increased economic growth and a shift toward non-materialist societal concerns.
- Specific existential risks, including nuclear winter and biotechnology catastrophes, are viewed as manageable with recovery timelines of a couple of decades or strategies such as moving away from high-density city living.
- Challenges regarding the "oracle problem" at geopolitical scales are identified as serious, requiring more robust infrastructure like carbon credits and identity systems before a solution is viable.
- Harberger taxes on assets such as copyright are expected to be implementable in the near future as a practical application of mechanism design.
- The crypto community is expected to develop better methods to distinguish genuine projects from scams to reduce the sector's negative reputation, while social rewards may be shifted toward effective donations through on-chain mechanisms.
- Private entities are encouraged to adopt free speech norms to avoid censorship costs, and the broader public is expected to gradually recognize the potential of mechanism design and crypto economics beyond simple currency speculation.
- A strategic focus is planned for "product people" to specialize in deploying identity systems and quadratic funding with user-friendly interfaces in the near future.