# Introduction

The blockchain space is everything but boring, it moves on an astonishing pace: every day is a tossup between a string of new impressive (and greatly exaggerated) headlines and sudden bloody crashes that can only be coped with by sharing memes about considering career changes to the nearest fast food franchise.

Take a few days to rest and you're back feeling like you've never even touched the space before. What the heck is reestaking? Are [fraud proofs really broken](https://ethresear.ch/t/fraud-proofs-are-broken/19234)? Why is everyone wearing a hat?

Still, in the rare quiet days, when the voices are debating whether we're the next internet or the next [tulip mania](https://www.youtube.com/watch?v=77D6krLlSR0), I often find myself reflecting on a very personal question: why am I still here?

In the middle of a persistent storm of skepticism - from economists (correctly) mocking bitcoiner's thoughts on monetary theory, gamers appalled by hardware prices and NFTs, to politicians addicted to "regulation through enforcement" - you're not doing a great deal of self-reflection if you, occasionally, don't ask yourself: [Are we the baddies](https://www.youtube.com/watch?v=ToKcmnrE5oY)?

I'm writting this piece in an attempt to articulate, maybe even to myself, what stands behind my decision to dedicate so much of my time and energy to Ethereum, [Cartesi](https://cartesi.io/) and the blockchain world.

I must confess, the idea of writing this was intimidating. There was a fear that when I finally sat down to type it, that I'd end up with a page just as empty as some claim our promises are. As you'll see, this fear was unfounded: the more I started to unpack the more I found to say. Very quickly, [para o desespero do leitor](https://translate.google.com/?hl=pt&sl=pt&tl=en&text=para%20o%20desespero%20do%20leitor&op=translate), I was back to my prolix self.

This post could have been much longer, but I suspect there are limits to your patience, if not to my enthusiasm.

# Why blockchain

Writing why blockchain matters feels similar to trying to predict the impact of the internet during it nascent stages. I'm not here to echo the overused and often simplistic comparison of blockchain to the internet - I'm trying to acknowledge the huge breadth of directions this technology could take. Picture yourself writing a blogpost about the [future of the internet in 1998](https://www.laphamsquarterly.org/revolutions/miscellany/paul-krugmans-poor-prediction). What would you have predicted? E-commerce, emails and photoblogs? Piratebay, MMORPGs and Wikipedia? News, racism and Youtube?

Deciding where to start is challenging - ithe implications of blockchains can be similarly vast and varied. In no specific order, I'll go through some of the things that make me excited about blockchains - ranging from concrete, real-world examples and philosophical (in lower case p) goals and intuitions. Of course, I'll sprinkle a dose of skepticism, a little insurance policy so I can find a new gig in case blockchain turns out to be useless (or worse).

Let's get to it:

## Bolsonaro

In case you're already snoozing off but unwilling to surrender until I show you at least one example where blockchains were useful, here it is:

In March, 2024, former Brazilian president Jair Bolsonaro was [accused by the federal police](https://www.bbc.com/news/world-latin-america-68610385) of fraud related to his COVID vaccination records. The [technology underpinning Brazil's vaccination record system](https://g1.globo.com/saude/noticia/2023/05/04/tecnologia-do-sistema-de-vacinacao-contra-a-covid-impede-que-doses-sejam-apagadas-sem-deixar-rastro.ghtml) that exposed this alledged fraud? Blockchain!

The article is in Portuguese, but here is a relevant quote: "Due to the secure and encrypted transmission of information through the blockchain, which stores copies of each block on millions of different computers and does not allow for data tampering or deletion, a dose that was entered by mistake can be erased from the source systems, but not without leaving traces."

I suspect many non-brazilians had no clue that this happened - but it's a hell of an example of blockchain being used for transparency, immutability and control.

This incident, however, also highlights the dual nature of blockchains. Are they tools to protect us from government overreach, or do they enhance government surveillance?

To placate any bolsonaristas possibly irked by this example, consider what might have transpired during the [Mensalão ](https://en.wikipedia.org/wiki/Mensal%C3%A3o_scandal) or [Petrolão](https://en.wikipedia.org/wiki/Operation_Car_Wash) scandals had blockchain-based systems been tracking government budgets and expenditures. Could such systems have provided the necessary oversight to deter corruption? Is there a place for blockchains in increasing government transparency and predictability?

As a side-note, I acknowledge that just mentioning the COVID vaccine might have made some of you upset - which is unfortunate, the vaccines were great and worked brilliantly.

## unbanked
When blockchains first started going mainstream, 'banking the unbanked' was one of its most popular slogans. It’s easy to lose sight of that noble goal amidst the headlines about expensive NFTs, bizarre and offensive memecoins (can we please stop that?), and high-profile scams and heists.

What you might be missing are the millions of value transfers and the financialization of marginalized communities.
These might not make the headlines, but they’re definitely happening.

According to this [global crypto adoption indexed](https://www.chainalysis.com/blog/2023-global-crypto-adoption-index/), by Chain Analysis, the top 10 countries that are 'leading the world in grassroots crypto adoption' are: India, Nigeria, Vietnam, United States, Ukraine, Philippines, Indonesia, Pakistan, Brazil, and Thailand.

When Scott Alexander [analyzed](https://www.astralcodexten.com/p/why-im-less-than-infinitely-hostile) the 2021 version of the same index, he went on to ask: 'Do Vietnamese people love trading monkey gifs? Are Ukrainians especially susceptible to Ponzi schemes? Is Venezuela laden with techbros?'

Then he goes on to talk about those countries' banking systems, fraud histories, and inflation. You can imagine what kind of picture he paints, right? Blockchains are an useful tool in a world riddled with opaque and confusing regulations, legal certainty and predatory banks/financial institutions.

Now, one thing needs to be said here:
'Banking the unbanked' is a laudable goal with many obstacles still in its path. The unbanked are definitely not going to pay the current gas fee prices for interacting with the blockchain, nor are they going to join an opsec best practices course to figure out how to keep their private keys safe, etc.

## SPOFs

REWRITE THIS
Avoiding single points of failure(SPOF) is one of the strongest raison d'etre of blockchains in general. A single point of failure represents an attack target, censorship powers and the possibility of total chaos. Financial systems shouldn't go down, ever. Things can go really dire if all your credit cards die on you at the same time.
They take this really seriously. Ethereum has been running non-stop since 2015, with no outages (unless you consider the [nasty 2016 Shanghai DDoS attacks](https://www.youtube.com/watch?v=nhr5nlMNvRQ) and Bitcoin has nodes running on [the godamn international space station](https://www.coindesk.com/tech/2019/12/09/a-bitcoin-wallet-is-orbiting-the-earth-at-5-miles-per-second/).

Take a second to reflect on how insane that is. To have a network, holding billions of dollars, with **permissionless interactions** to never go down.

And that is what we're building. We're building a new type of financial system - one that focus on resilience. It's a distributed system, designed to survive hostile, permissionless, 24/7 interactions. It's a system built, if you're into trendy words, with Antifragility from the ground up.

The systems we're building are not just open source, they're open access. They're censorship resistant.
Imagine if your day to day bank opened up access to their source code, gave the world their API keys and allowed anyone at any time to interact with it. How long would it take for your networth to dissappear?
"Our security is strong enough that we’re not worried about letting you try to break in."

Thats a great way to build things.

How could Cartesi be used? Though I used the financial system example, it's easy to consider dozens of other industries that could benefit for all those properties.
Why not build complex applications that have no single points of failure? Shouldn't your health insurance app run in that way? Shouldn't it be built in a way that your data is always online, that doesnt require security through obfuscation, that can't be held hostage by malicious agents? Ransomware attacks, for example, are a real risk for SPOF enabled applications.

## moloch
REWRITE THIS:

"Moloch the incomprehensible prison! Moloch the crossbone soulless jailhouse and Congress of sorrows! Moloch whose buildings are judgment! Moloch the vast stone of war! Moloch the stunned governments!" - Allen Ginsberg

In fewer and less poetic words, Moloch is the god of coordination failures, where individual incentives lead to collectively disastrous outcomes.

Scott Alexander's famous essay, [Meditations on Moloch](https://slatestarcodex.com/2014/07/30/meditations-on-moloch/), has been the source of inspiration for many in the crypto industry. He describes, in several examples, situations in which an outcome that noone wants is the norm because of misaligned individual incentives. A careful reader will notice that he doesn't resort to culture or family relationships to hinder his scenarios less pessimistic - but the pure "rational" analysis is interesting nonetheless.

A possible description for blockchains and smart contracts, is a [pre commitment machine](https://www.aier.org/article/smart-contracts-as-pre-commitment-devices-on-a-blockchain/). Turns out that, alongside culture, relationships and [superrationality](https://en.wikipedia.org/wiki/Superrationality), pre-commitment machines can help us dearly with misaligned incentive problems.

Scott's first two examples are [dollar auctions](https://en.wikipedia.org/wiki/Dollar_auction) and [The Prisoner’s Dilemma](https://en.wikipedia.org/wiki/Prisoner%27s_dilemma). Both are examples in which rational decisions lead to a worse outcome for everyone involved. Both are also examples that we know how to solve with a pre-commitment machine.

In the same way that one can beat the [chicken game](https://en.wikipedia.org/wiki/Chicken_(game)) by publicly disabling their own ability to swerve, the dollar auction is beat by creating a kamikaze pre-commitment attesting that you're willing to spend your entire networth on it. In both cases, whoever publishes the commitment first wins the game.

The prisioner's dillema is solved with a more kumbaya commitment, where both players pre-commit to be slashed by a significant amount in case they do not cooperate - changing the rewards matrix in a way that their best strategy is to hold hands and try to befriend SBF or something.

Moloch is a common trope in the blockchain space, [Moloch DAO](https://molochdao.com/) has weaponized the concept to gather funds to support public goods and ethereum infrastructure:

"The future of humanity requires the sacrifice of your shallow desires, but its reward is the head of Moloch himself.

This demon god of coordination failure, who consumes our future potential for perverse immediate gain, will be slain. Pledge your oath to his demise, or go down with him." - Moloch DAO manifest

Blockchain acts as a commitment device, allowing parties to pre-commit to strategies in cooperative games that otherwise would end in mutual defection.

slaying moloch (tho ignores social structures like family, friends and superrationality)
The living Molochs of today are the dead Molochs of tomorrow’s History books.
Moloch, the god of coordination failures, where individual incentives lead to collectively disastrous outcomes.

This characteristic is particularly valuable in critical infrastructures like financial services, health care data management, and even national security applications.

---- Blockchain acts as a commitment device, allowing parties to pre-commit to strategies in cooperative games that otherwise would end in mutual defection.

## the nirvana fallacy
In a sense, at least so far, crypto is reinventing a lot of existing things but worse. Transferring money using the blockchain, at this very moment, is much more expensive, complicated and less convenient than [PIX](https://www.bcb.gov.br/en/financialstability/pix_en).

Here, I revert back to Scott Alexander again: "yes, but it's in space".
I quote:
"The lunar rover is just a car, only worse. That robocopter that flew around Mars is just a drone, only worse. We spent $100 billion building the International Space Station, which is basically just a big house in space. But we already have houses on Earth which are cheaper and more comfortable in every way!"

It's easy to disregard the entirety of crypto, comparing it to a perfect world where governments and banks are a source of pride. A reality either devoid of authoritarianism or surrounded by benevolent dictators. Well written and effective regulations. In that world, why would you go to the hassle of designing antifragile, censorship resistant protocols? Why would you want an open-source, decentralized twitter if you believe Elon Musk should have extreme power over our digital public squares? Or if you believe the [congress knows tech well enough](https://www.youtube.com/watch?v=ncbb5B85sd0) to draft a decent bill regulating it. Why would you reinvent the financial system if there are no reasons for banks to not transfer money instantly, for much cheaper? Why would you have a international currency if all countries had reasonable monetary policies and you're currency doesnt devalue insanely as soon as you cross a border.

In a perfect world, blockchains are not needed. Making decentralized, permissionless and censorship-resistant software makes applications slower, more complicated and harder to use - but they can be a good defence against an imperfect world.

## a little dose of skepticism
It's easy to talk about intuitions, possibilities, future dreams and utopias. The reality is, the tech has been around for a while now and if the optimism of the prophets is justified, we sure need to see something more substantial happening soon. Are we going to bank the unbanked without very cheap micro-trasanctions? Who'd use twitter if every tweet costed something? Should you really care about the company behind the game you like? Where are the real usecases?

I definitely agree that we're on a timer. We need to find substiantial usecase soon, to justify all the hype thats been poured in the space. Most funding, in the space, goes to infrastructure projects - which is great to expand the [cone of innovation](https://twitter.com/ERC_Brandon/status/1754500351376437661). But we need the usecases too.
However, there is a worst possibility that blockchains being useless: blockchains being harmful.

[Are we the baddies](https://www.youtube.com/watch?v=ToKcmnrE5oY)?
It's not a secret to most that I'm not fully convinced that blockhains will be net good in the world. There is a lot that can go wrong and the technology, as in any powerful and new idea, can get coopted by bad actors.
Hanna Arendt argues, in "Banality of Evil" that great wrongs can stem from the acts of individuals abdicating their ethical thinking to the authority of the collective or the **momentum of the technology itself**.

This understanding should not leas us to despair, but to proactivness. We have the responsibility to embed our moral convictions into the culture that surrounds this technology, to actively participate and shape its trajectory towards the greater good. Just as the internet has become a battleground for competing values, so too will blockchain.

We have the responsibility to be aware of the dangers of unthinking compliance. And the responsibility of steering it into a good direction.

# Conclusion and byproducts

"A product is a theory of how to solve a problem." - Naval Ravikant

AI, IoT, blockchain

open source code with memory

The hard thing about pinpointing Ethereum's value is that there are many different problems that people want to fix with it. In a sense, you can choose which

why I'm less than infinitely hostile
financial inclusion

public good funding

research funding

governance

sovereignty

## slaying the optimistics
Of course it's not all violets and roses.
It's not a secret to most that I'm not fully convinced that blockhains will be net good in the world. There is a lot that can go wrong and the technology, as in any powerful and new idea, can get coopted by bad actors.

There is also the possibility of all of this not being useful yet - some make the case that blockchains will be truly useful in a world dominated by AI and IoT, where the robots will need a sense of ownership and a market economy to modulate, align and respond to incentives.

Who knows?
lots of things you can believe in and still be a part of ethereum

I do know a few things, however. I know that this field is on the edge of innovation, this field attracts provably brilliant minds that are expanding fields and debates all around. Not only in governance, finance, but also in computer science and math.
Incentivized research has, undoubtly, been an amazing byproduct.

Take a look at ZK research. If you're not hyped about ZK as a tech, I suggest you read more about it.
Zero knowledge was a thing before the blockchain, a few math nerds were into it. But after the crazyness of blockchain and all the money poured into it, it advanced at lightning speed and is now a vibrant, promising and exciting area. Same with consensus algorithms, digital money and etc etc...

But let's talk about the practical use cases

political grifters, libertarians, far right
was hasnt the left caught wind of whats happening
at least its not AI hehe
are we the baddies?

# Usecases I care about

proof of personhood e AI
quadratic funding e governance

or each section mention what could be improved/done with Cartesi