Original author: Vitalik Buterin
Original compilation: TechFlow TechFlow
On the 29th, Ethereum founder Vitalik Buterin published a new article titled "Make Ethereum Cypherpunk Again", discussing how the Ethereum community can return to the concept of Ethereum Cypherpunk. The author reviews the development of the Ethereum ecosystem over the past decade and notes that the vision of consumer crypto payments is gradually disappearing due to rising transaction fees.
TechFlow TechFlow compiled the full text.
Ten years ago, one of my favorite memories was a pilgrimage to an area of Berlin known as the Bitcoin District: it was an area in Kreuzberg with about a dozen shops, all accepting Bitcoin. Coin payment. The centerpiece of the community is Room 77, a restaurant and bar run by Joerg Platzer. In addition to accepting Bitcoin payments, it also serves as a community center frequented by various open source developers, political activists, and other characters.
A similar memory from two months ago was PorcFest ("Don't Tread on Me"), a liberal gathering in the woods of northern New Hampshire, where meals were mainly served at restaurants such as "Revolutionary Coffee" and "Demagoguery." Soups, Salads and Smoothies” small restaurants, of course, also accept Bitcoin payments. Here, discussing the deeper political implications of Bitcoin and using it in everyday life go hand in hand.
I bring up these memories because they remind me of the deeper vision behind cryptocurrencies: Our goal is not just to create isolated tools and games, but to comprehensively build a freer and more open society and economy , in which different parts such as technology, society and economy are integrated with each other.
The early vision of "web3" was also this type of vision, with a similar but slightly different direction. Ethereum co-founder Gavin Wood originally coined the term "web3" to refer to a different way of thinking about Ethereum: rather than thinking of it as "Bitcoin plus smart contracts," as I initially did, Gavin viewed it more broadly. It is viewed as part of a set of technologies that together form the base layer of a more open internet stack.
When the free and open source software movement began in the 1980s and 1990s, the software was simple: it ran on your computer and read and wrote files on your computer. But today, most of our important work is collaborative, often on a massive scale. So even though the underlying code of the application is open and free, your data is routed through a centralized server operated by a company that can read your data at will, change the rules, or strip you off at any time. platform. So if we want to extend the spirit of open source software into today's world, we need programs to be able to access shared hard drives to store content that multiple people need to modify and access. What is Ethereum, and its sister technologies like peer-to-peer messaging (then Whisper, now Waku) and decentralized file storage (then Swarm, now IPFS)? This was the original vision from which the now ubiquitous term "web3" was born.
Unfortunately, since around 2017, these visions have somewhat receded into the background. There’s very little talk about consumer crypto payments, the only non-financial application being used on-chain at scale is ENS, and there’s a huge ideological gap between the non-blockchain decentralized community and the crypto world, non-blockchain Much of the decentralized community views the crypto world as a distraction rather than a like-minded spirit and powerful ally. In many countries, people do use cryptocurrencies to send and save funds, but they usually do so through centralized means: either through internal transfers from centralized exchange accounts, or by trading USDT on Tron.
Having lived through that era, I believe the fundamental reason for this shift is rising transaction fees. When the cost of writing to the chain is $0.001, or even $0.1, people are willing to develop all kinds of applications and use the blockchain in various ways, including non-financial ways. But when transaction fees rise above $100, as they did at the peak of the bull market, there is only one audience willing to play: Degen, who in fact become richer and even more willing to speculate as the price of the coin rises. A moderate amount of speculation is acceptable, and I spoke to many people at events who joined crypto because of financial motivations, but stayed because of ideals. But when they become the largest group using blockchain at scale, it changes public perception and the internal culture of the crypto space, and leads to many of the other negative impacts we’ve seen over the past few years.
Now, fast forward to 2023. Whether it's the expansion's core challenges or the various "side missions" that are crucial to building a viable cypherpunk future, we actually have a lot of positive news to show for it:
·Rollup begins to really exist
After a temporary lull following the regulatory crackdown on Tornado Cash, second-generation privacy solutions like Railway and Nocturne are seeing the light of day
·Account abstraction begins to rise
·The long-forgotten light client begins to really exist
Zero-knowledge proofs, a technology we thought were still decades away, are here, becoming increasingly developer-friendly, and will soon be available for consumer applications
These two things: the growing recognition that uncontrolled centralization and over-financialization are not the nature of cryptocurrencies, and the key technologies mentioned above that are finally maturing, together provide us with an opportunity to move things in the direction of develop in different directions. That is, making at least part of the Ethereum ecosystem truly the permissionless, decentralized, censorship-resistant, open source ecosystem we originally built it to be.
What are these values?
Many of these values are shared not only by many in the Ethereum community, but also by other blockchain communities and even non-blockchain decentralized communities, although each community places a different combination and emphasis on these values. different.
·Open global participation: Anyone in the world should be able to participate as a user, observer, or developer with the greatest degree of equality. Participation should be permissionless.
· Decentralization: Minimize the dependence of applications on any single actor. In particular, the application should continue to run even if the core developer is permanently missing.
Censorship resistance: Centralized actors should not have the power to interfere with the operation of any specific user or application. Concerns about malicious actors should be addressed at higher levels of the technology stack.
Auditability: Anyone should be able to verify the application’s logic and its ongoing operations (e.g., by running a full node) to ensure that it operates according to the rules claimed by the developers.
·Trusted neutrality: The base layer infrastructure should remain neutral in a way that anyone can see its neutrality even if they do not trust the developers.
·Build tools, not empires. Feudal empires seek to capture and trap users within walled gardens; tools accomplish their tasks but otherwise interoperate with the wider open ecosystem.
·Collaborative mentality: Even when competing, projects within the ecosystem collaborate in shared software libraries, research, security, community building, and other areas that are generally valuable to them. Projects seek to achieve win-win cooperation with each other and with the wider world.
Within the crypto ecosystem, it is entirely possible to build something that does not adhere to these values. For example, a system could be built that is called L2, but is actually a highly centralized system secured by multi-signatures, with no intention of ever moving to something more secure. One could build an account abstraction system that attempts to be "simpler" than ERC-4337, but at the cost of introducing trust assumptions that ultimately eliminate the possibility of a public memory pool and make it harder for new builders to join. It is possible to build an NFT ecosystem in which the contents of the NFT are needlessly stored on a centralized website, making it more fragile than if these components were stored on IPFS. One could also build a staking interface that unnecessarily directs users to the already largest staking pool.
Resisting these pressures is difficult, but if we don't we risk losing the unique value of the crypto ecosystem and reproducing a less efficient, step-by-step clone of the existing web2 ecosystem.
"Where there are sewers, there are Ninja Turtles"
The crypto space is an unforgiving environment in many ways. Dan Robinson and Georgios Konstantiopoulos made this point vividly in a 2021 article where they discussed in the context of MEV that Ethereum is a dark forest where on-chain traders are constantly faced with being front-loaded by trading bots The risk of exploitation is that these robots themselves are also easily counter-exploited by other robots. This is true in other ways as well: smart contracts are hacked frequently, user wallets are hacked frequently, centralized exchanges fail miserably, etc.
This is a huge challenge for users of the space, but it also presents an opportunity: it means we have a space to really experiment, incubate and quickly receive live feedback on various security technologies to address these challenges . We have seen successful responses to the challenge in different contexts:
Problems and Solutions:
·Centralized exchanges were hacked: Use decentralized exchanges to add stablecoins, so you only need to trust the centralized entity to handle fiat currencies
·Personal private keys are not secure: smart contract wallets: multi-signature, social recovery, etc.
·Users are tricked into signing transactions and running out of funds: Wallets such as Rabby show users the results of transaction simulations
·Users were sandwiched by MEV players: Cowswap, Flashbots Protect, MEV Interceptor..
Everyone wants the Internet to be safe. Some seek to achieve this by pushing for methods that force reliance on a single actor, whether a company or government, that can serve as a centralized anchor of security and truth. But these approaches sacrifice openness and freedom and contribute to the tragedy of a growing “fragmented web.” People in the crypto space place a high value on openness and freedom. The high stakes and huge financial stakes mean that security cannot be ignored in the crypto space, but a centralized approach to security cannot be adopted for various ideological and structural reasons. At the same time, the cryptocurrency space is at the forefront of very powerful technologies such as zero-knowledge proofs, formal verification, hardware-based key security, and on-chain social graphs. Together, these facts mean that, for cryptocurrencies, an open approach to improving security is the only way to go.
All of this means that the crypto world is a perfect test bed environment to take its open and decentralized approach to security and actually apply it to real-world high-stakes environments and mature it to the point where it can be applied part of the content. This is one of my visions of how the idealistic parts of the crypto world and the chaotic parts of the crypto world, as well as the crypto world as a whole and the mainstream more broadly, can turn their differences into symbiosis rather than exacerbating tensions between the two degree.
Ethereum as part of a broader technology vision
In 2014, Gavin Wood launched Ethereum as one of a set of tools to build upon, along with Whisper (decentralized messaging) and Swarm (decentralized storage). The former has received great attention, but unfortunately, with the shift towards financialization around 2017, the latter has received much less attention. Despite this, Whisper continues to exist in the form of Waku and is actively used by projects such as decentralized communications Status. Swarm continues to grow and now we also have IPFS for hosting and serving this blog.
Over the past few years, with the rise of decentralized social media (Lens, Farcaster, etc.), we’ve had the opportunity to revisit some of these tools. Additionally, we have another very powerful new tool to add to the triad: zero-knowledge proofs. These technologies are most widely used as a way to improve Ethereum’s scalability, like ZK rollups, but they are also very useful for privacy. In particular, the programmability of zero-knowledge proofs means we can move beyond the false binary of “anonymous but risky” versus “KYC therefore secure” and gain privacy and multiple authentications at the same time.
The 2023 Zupass is one example. Zupass is a zero-knowledge proof-based system incubated at Zuzalu that is used both for on-site authentication for events and online for voting systems like Zupoll, Twitter-like Zucast, and more. The key feature of Zupass is that you can prove that you are a resident of Zuzalu without revealing which member of Zuzalu you are. Each Zuzalu resident can only have one randomly generated cryptographic identity for each application instance they log into (such as voting). Zupass has been so successful that it will launch Devconnect's ticketing service later this year.
Perhaps the most useful application of Zupass so far is voting. Various polls were conducted, some involving politically controversial or highly personal topics, and there was a strong need to protect privacy using Zupass as an anonymous voting platform.
Here we can begin to see the outlines of the cypherpunk world of Ethereum, at least on a purely technical level. We can hold assets in ETH and ERC20 tokens, as well as various NFTs, and use a privacy system based on stealth addresses and Privacy Pools technology to protect our privacy while preventing known bad actors from profiting from the same anonymous pool. Whether in our DAO, to help decide changes to the Ethereum protocol, or for any other goal, we can use zero-knowledge voting systems that can use a variety of credentials to help identify who is eligible to vote and who No. In addition to voting with tokens like we did in 2017, we can also vote anonymously for people who contribute enough to the ecosystem, who attend enough events, or one vote per person.
Online and offline payments can be enabled through ultra-low-cost transactions on L2, which leverage data availability space (or off-chain data through Plasma protection) and data compression to provide users with ultra-high scalability. Payment from one rollup to another can be achieved through a decentralized protocol such as UniswapX. Decentralized social media projects can use various storage layers to store activities such as posts, retweets, and likes, and use ENS (cheap with CCIP on L2) as usernames. We can have seamless integration between on-chain tokens and off-chain proofs held by individuals and ZK proofed through systems like Zupass.
Mechanisms such as quadratic voting, cross-tribe consensus, and prediction markets can be used to help organizations and communities govern themselves and stay informed, while blockchain and ZK-proof-based identities can make these systems immune to centralized scrutiny from within and coordinated manipulation from outside . Sophisticated wallets can keep people safe while participating in dapps, user interfaces can be published to IPFS and accessed as .eth domain names, and hashes of HTML, javascript, and all software dependencies are updated directly on-chain via the DAO. Smart contract wallets were born to help people not lose tens of millions of dollars in cryptocurrency, and they will expand to protect people's "identity roots" and create a more secure system than centralized identity providers such as "Log in with Google."
In our understanding of the Ethereum ecosystem (or "web3"), we can think of it as an independent technology protocol stack that competes with traditional centralized protocol stacks at all levels. Many people use both, and there are often clever ways to combine the two: with ZKEmail you can even make your email address one of the keepers of your social recovery wallet! But at the same time, there are many synergies in using different parts of the decentralized stack, especially when those parts are designed to better integrate with each other.
One of the benefits of thinking of it as a stack is that this fits well with Ethereum’s diverse ethos. Bitcoin aims to solve one or at most two or three problems. Ethereum, on the other hand, has many sub-communities with different focuses. There is no one dominant narrative. The goal of the stack is to facilitate this plurality while working towards increasing interoperability between these pluralities.
social level
It is easy for people to say, "The people doing X are harmful and corrupt forces, but the people doing Y are the real mainstream." But this is a lazy response. To truly succeed, we not only need a vision for the technology stack, but also the social part of the stack that enables the technology stack to be built in the first place.
The advantage of the Ethereum community is that, in principle, we take incentives seriously. PGP wanted to put encryption keys into everyone's hands so we could actually sign and encrypt emails for a few decades, but it basically failed, and then we got cryptocurrencies and suddenly millions of people had them With the keys publicly associated with them, we can start using those keys for other purposes—including going back to encrypting email and messaging. Non-blockchain decentralized projects are often severely underfunded, while blockchain-based projects can receive $50 million in Series B funding. We got people to stake their ETH to secure the Ethereum network, not out of stakeholder benevolence, but out of their own self-interest - and we gained $20 billion in economic security as a result.
At the same time, incentives alone are not enough. Defi projects often start out modestly, collaboratively, and open source to the fullest extent, but sometimes start to abandon these philosophies as they grow in size. We can incentivize shareholders to join and maintain very high uptime, but it is much harder to incentivize shareholders to decentralize. It may simply not be possible to achieve this through internal means of the protocol alone. Many key parts of the “decentralized stack” described above do not have viable business models. The governance of the Ethereum protocol itself is decidedly non-financial – making it more robust than other ecosystems whose governance is more financial. This is why it’s valuable for Ethereum to have a strong social layer that strongly enforces its values where pure incentives cannot — but without creating the concept of an “Ethereum Alliance” that becomes a a new form of political correctness.
There needs to be a balance between these two aspects, not so much balance but integration. Many people first get into crypto out of a desire to get rich, but they later become familiar with the ecosystem and become enthusiastic followers of building a more open and decentralized world.
How do we actually achieve this integration? This is a key question, and I suspect the answer lies not in one, but in a combination of a range of techniques acquired through iteration. The Ethereum ecosystem has been more successful than most in encouraging a collaborative mentality among L2 projects purely through social means. The large-scale public goods funding from Gitcoin Grants and Optimism’s RetroPGF round, in particular, has also been extremely helpful, as it creates another revenue channel for developers who don’t see any traditional business model, without sacrificing their values. . But even though these tools are still in their infancy, there is still a long way to go to improve these specific tools and identify and develop others that may be better suited to specific problems.
This is where I see the unique value of Ethereum’s social layer. There is a unique middle ground of valuing incentives without being consumed by them. There’s a unique mix here of valuing a warm and close community, but also remembering that what seems “warm and close” from the inside can easily turn out to be “oppressive and exclusive” from the outside, and valuing neutrality, open source and hard norms that resist censorship as a safeguard against the risk of becoming too community-driven. If this combination works well, it will in turn be in a position to realize its vision on both an economic and technological level.
