Jesse Walden of Variant Fund, and Robert Leshner of Compound explain all of the problems associated with the decentralizing process in terms of governance and compliance, pulling from their own lessons and their commentary on other projects. We cover:

• Why projects must start with some level centralization
• How projects can both monetize and not put their code at risk of being forked
• How they can decentralize while also maintaining security, especially for composable DeFi projects that may become vulnerable as new technology and new protocols are introduced
• How and when to distribute the token so as not to attract only speculators and also not trip regulatory wires 
• How Compound’s current governance works, how it is decentralizing, why they decided to use a governance token, and what Compound (the company) will do after full decentralization 
• Why open-sourced projects are still able to extract profits, even after a fork
• Whether or not teams should have admin keys, such as what was used in response to the bZx attacks
• Whether or not projects should be upgrade-able
• What Block.One, which raised $4 billion in an ICO, did right to only pay a $24 million fine to the SEC 

Thank you to our sponsors! 

Crypto.com: https://crypto.com

Kelman Law: https://crypto.law  

Stellar: https://www.stellar.org

Episode links: 

Jesse Walden: https://twitter.com/jessewldn

Robert Leshner: https://www.linkedin.com/in/rleshner/

A16z Crypto startup school: https://a16z.com/crypto-startup-school/

Compound: https://compound.finance

Progressive Decentralization playbook: https://jessewalden.com/progressive-decentralization-a-playbook-for-building-crypto-applications/

What recent moves by the SEC say about mutability when it comes to crypto networks: https://a16z.com/2019/10/22/mutability-sec-recent-cases/

Compound’s $COMP token: https://medium.com/compound-finance/compound-governance-5531f524cf68

More on Compound’s governance token: https://www.coindesk.com/compound-extends-defi-ethos-to-itself-launches-governance-token

Unchained discussion about bZx attacks: https://unchainedpodcast.com/the-bzx-attacks-unethical-or-illegal-2-experts-weigh-in/

Eric Wall tweet storm on admin keys: https://twitter.com/ercwl/status/1229198599264907264?s=20

tBTC shutting down: https://twitter.com/keep_project/status/1262483526437556228

More on tBTC: https://www.coindesk.com/bug-forces-shutdown-of-bitcoin-backed-ethereum-token-tbtc

Unchained interview about tBTC in which Matt Luongo explains the admin key: https://unchainedpodcast.com/tbtc-what-happens-when-the-most-liquid-crypto-asset-hits-defi/

Is the SEC trying to kill the SAFT? https://www.coindesk.com/with-kik-and-telegram-cases-the-sec-tries-to-kill-the-saft 

Block.One settlement with SEC: https://www.coindesk.com/eos-maker-block-one-settles-with-sec-over-unregistered-securities-sale

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