Listen to Infinite Loops: https://www.infiniteloopspodcast.com/alex-danco-what-is-web-30-all-about-ep95/ (37mins in)
Transcript
Alex Danco:
Yeah. So one of the cool things is that, I can say this from a vantage point at Shopify, is that all of this is
fairly obvious to us and it's not because we're smart people, it's because when your whole life is working
with merchants, it's like, these are merchants whose job is not terribly dissimilar from musicians. It's
create meaning, create community, create a reason to come back and talk to each other, and therefore
products get sold because of that underlying meeting. It's like, no, shit, that's what this is for. This is
what we already were doing, this isn't new, this is kind of like it just makes a lot of sense.
Jim O'Shaughnessy:
Right. And it's repackaged and it gives the tool to greater extend the reach. But yes, I agree with you.
Alex Danco:
So, hey, we should NFT this conversation and sell it, and then if you buy this NFT, you'll become the only
person who gets to understand what NFTs are for. You have the exclusive rights to it, everybody else
gets to be wrong.
Jim O'Shaughnessy:
Everyone else is wrong.
Alex Danco:
Unless somebody right clicks and saves the audio file of our podcast, in which case they have stolen it
from you.
Jim O'Shaughnessy:
Yes. And you're fucked.
Alex Danco:
Good luck to you. Sorry for your loss. Sorry, you got hacked.
Jim O'Shaughnessy:
Well, this leads into Web3, because I was very eager to hear you do a bit on Web3, it's like so much stuff
is being written, talked about, blah, blah, blah, blah, blah. What are your thoughts?
Alex Danco:
I mean, to some degree, I think it's like being able to draw a precise box around Web3 is a little silly
because it's like there's just the web and it's all these cool tools. And certainly at Shopify, our job, I mean
on the blockchain team and also generally is not to give merchants the best of Web3, as opposed to
Web2, our job is to give them good things that help them.
Jim O'Shaughnessy:
Exactly.
Alex Danco:
And it's like if you want to draw a box around this bunch of stuff that's Web3, fine. However, in an
attempt to not be sarcastic and actually answer your question correctly, here is I think a good way to
think about what Web3 is. So if you go back to this whole idea of, okay, there are these things called
blockchains, what is the point to them? What do they do? Why do we care about them? It's like, okay,
what is the blockchain? A blockchain is a new kind of network computer that is designed around a really
interesting set of constraints.
And the constraints are very expensive and but they do something really interesting, which is
they allow for a bunch of people to create this shared state that everybody can agree on the inputs and
everybody could agree on the rules. And it's very, very constrained in how you're able to modify this
state, but everybody can agree on what has been done. And different blockchains have different rules,
the rules of Bitcoin are different from the rules of Ethereum or different from the rules of flow
blockchain or polygon, any of those things. But ultimately you create this shared bit of state that can
grow in ways that are very, very constrained, but are highly observable and agreed upon.
So what is the point of that? Who the fuck cares, what is this for? Well, what's interesting about
this is that this creates this new format for something that you can call code that can make
commitments. What does that mean? Well, it means that you can submit some code to this that will
run, and once it's running, you can actually trust that it will run in a fairly deterministic way,
independent of any of the actors involved. So long as you trust that Ethereum will exist, then you can
expect that this smart contract will behave in a certain way. It's code that can make commitments, that's
neat. Well, what's the point of that?
Well, what's really interesting about code that can make commitments is that it makes possible
a new setting for running certain kinds of applications. Well, what are those certain kinds of
applications? It's like, well, it's a new setting for whether, it's like developers to go create little instances
of rules that will follow those codes that can make commitments. And that might have some value to
people, both because of the inherent work that they do, but also because of the shared state that they
do it in. Again, going back to this, well, there's a shared meaning and that has some interesting value,
and if you're also participating in this, then that's really cool.
And I'm sort of building and building there, but what ultimately that makes possible, and really
it's like it took us the better part of a decade to actually really settle on this as the atomic unit of what's
the point of this is wallets. We had all these false starts with crypto about how regular people could
think about what the atomic unit of it was. Like, is the atomic unit the coins? It's like, well, yes, but then
largely what you think of what you're doing is speculating. Is the atomic unit like network and ICOs as a
way of bootstrapping a certain thing? It's like, oh, maybe, if what you think of what you're trying to do is
various kinds of incentive design and whatever.
But ultimately now I think we're sort of at this point that largely actually mimics the beginning of
the internet and the web where it's like there was 10 years of web before the web browser where it was
very hard to actually do anything with it. And then the browser came along, it was like, ah, okay, now I
can actually do stuff. Same thing with wallets, I mean, wallets have existed since the beginning of
blockchain. It's literally just like an address and then a key that you sign with to show you're you, but it's
like it wasn't until I want to say Metamask is the first sort of modern wallet that let you actually do
things.
And now these modern wallets, like Rainbow that are amazing where you're like, "Oh my God, I
get it." The point of this is for me to be able to say, "Hey, this is a way for me to do informed consent for
things where you know it's me consenting because of the blockchain in the back being you know it's me,
and you know it's informed because of what is basically called, if you ever interacted with this, it's like,
sign this message. Sign this message to inform consent to X. And it can only be you because it gets all go
back to, so the point of the blockchain is so that why wallets can do informed consenting to things and
the wallets can do informed consent that has meaning because of the shared state that's in the
blockchain back.
So pause for a second. Now what on earth is that good for, if again, this is only useful in this
super slow, clunky Web3 environment that doesn't actually have any real work it's doing yet? It's like,
well, now you can go back and you can say, "Okay, well now we can think about this web space full of
web apps and full of databases and applications and abstractions about what's in those databases and
APIs through which you can access them and then applications that build on top of them and then users
who use this applications. And it's like, all of that web stuff can still exist, just now bookended with these
two very strong concepts of the wallet and informed consent and removable informed consent.
I can take it with me, I can remove my consent from somewhere and add it to somewhere else.
This is all the idea of how Unfollow is the most important button on Twitter? Remove Wallet is the most
important button in Web3, it's like you can just leave and go somewhere else. But again, it's like you
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