Vitalik Buterin: evaluation

Transcript context

…What’s the contribution or understanding you wish economics could give you that it hasn’t given you yet? What problem do you want it to solve for you? I think that once you start getting into the weeds, and you try to move beyond very simple things like proof of work, the simplest versions of proof of stake, and the tricks that we’ve known about since 2009 or 2013, then you get into this situation where you realize the kinds of problems that you run into when you try to incentivize behavior. Particularly when you run into things like what I call speaker/listener fault equivalence, which is basically this idea that if the protocol requires Alice to send a message to Bob, and the protocol detects that Bob never showed a message from Alice, then the protocol knows that either it’s because Alice forgot to speak or it’s because Bob pretended not to listen. Then, under those kinds of conditions, trying to figure out what is the right way to motivate Alice and motivate Bob while preserving all sorts of different properties. These are questions that are very close to questions that game theorists, mechanism designers, people in the economics community have already had a lot of things to say about. There definitely are results from the existing fields of economics and game theory that have helped significantly in that regard. Another whole aspect is also the broader and social question of how will blockchain-based systems actually end up affecting society? What is a blockchain’s unique competitive advantage? What are things that you can do with blockchains that you can do only with more difficulty without them? Trying to go from there and zero in and try to figure out exactly what industries and what kind of applications in those industries should be going after. Do the things at the application layer that we’re trying to build even make sense? Should we modify them in some way to have them make more sense? I do think that people from the economics community have a lot to say about that. Alex Tabarrok, for example, had that very nice post on Marginal Revolution a couple of weeks back, where he talked about blockchains in terms of being an alternative to platform monopolies, and I thought that was a very good insight. I thought that the general idea that a blockchain is one of the few tools that allows you to credibly commit to not turning into a monopolistic jerk is actually a really interesting insight and one that I have arrived at myself, but it definitely helps to have it be crystallized in that way. If you had to explain blockchain to a very smart person from 40 years ago, who knew computers but had no idea of crypto, what would be the best short explanation you could give them, basically, for what you do?…

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