IGF 2018 - Day 3 - Salle IV - DC on Blockchain Technologies

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>> CARLA L REYES: Okay, welcome to the session of the dynamic coalition on blockchain technologies where we will explore the status of blockchain governance and its implications for the use of the technology good bad or otherwise for purposes of social good. I have with me a panel of five esteemed speakers and the first to my left is Pindar Wong. Pindar wrong is the chairman of VeriFi Ltd, a discreet internet financial infrastructure consultancy, he's an internet pioneer who co-founded the first licensed Internet service provider in Hong Kong in 1993 and leads the belts and road blockchain consortium. In 2015, he helped organize Asia's first blockchain workshops scaling Bitcoin.org and sponsored the Hong Kong Bitcoin Roundtable. He also serves on the Hong Kong government's Committee on Innovation Technology and Reindustrialization and as a director of the Hong Kong Applied Science and Technology Research Institute. To his left is Maria Gomez who is currently the head of Ego System development at Aragon1 and also a Colombian trained lawyer. To her left is Primavera de Filippi who is a permanent researcher at the National Centre of Scientific Research (CNRS) at the University of Paris II, a faculty associate at the Berkman Klein Center for Internet and Society at Harvard University and co-founder and co-director of the Coalition for Automated Legal Applications also known as COALA. To her left is Rick Dudley who is a blockchain architect and is one of the folks behind many of the most important or biggest Dao projects and to his left is Constance Troy who is also the the other co-founder and co-director of Coalition for Automated Legal Applications and leads seven advisories. We will begin with comments from Pindar Wong.

>> PINDAR WONG: Thank you very much and good afternoon to everyone. I was asked to provide a sort of very high-level view of the the rainforest to help prepare and provide some context today and so what I'd like to do that is really talk about the sort of the Bitcoin or blockchain hype in general the hope and then some sense the reality and to try and give some language and thoughts around which to reason. 

So first of all, you probably all heard about you know Bitcoin exists as the very one is almost ten years now there are other terms that are being used like blockchain technology or distributed ledger technology whatever is politically correct but you're probably hearing it everywhere, in a sense that, you know, blockchain can do lots of things even though we may not be very accurate in terms of what we actually define as a blockchain of what is actually the innovation itself. If you look at the genesis behind this the language of money is really very powerful but we can express with that so if we go back to ten years ago with the invention of Bitcoin during, or just after, well during the great financial crisis it's been ten years and that has evolved to many other two thousand different cryptocurrencies and now other kinds of blockchains which are involving smart contracts like Aetherium and basically the idea thatnot only it can be financially fly, we've invented that sort of Wright brothers moment. But also that it can be used for many other things. 

So the hype is certainly there I'm personally a little bit confused, I think the hype is overdone and this is again just my opinion. I look forward to what I call the blockchain winter very much like the dot-com boom it's kind of very frothy but thereafter the sort of the froth gets taken away the real work continues all the tide goes out we see who's swimming naked so to speak and the real work gets done. So with respect tothe hype, I think the real thing to take away here is that we can now design incentives, obviously financial incentives, are the easiest one to understand in a very very granular way and so there are different fields now which we are the cool cryptoeconomics or token economic which means that making money now is literally a command line right we can “make money” enter. So the language will, the monopoly on the creation of money as a very very powerful tool has now, it's now all software and it's out there. And so now what's very great about it is a Cambrian explosion in thinking about not only incentive structures and all the ways that we can design and build community networks for example but also different ways of restructuring society as we continue to digitize everything, not just financial access. 

So moving on to the hope here is, I like to say that no one is above the law and no nation below mathematics and it's kind of ironic that we say that in this context because you know the United Nations and they're sort of the world of law and borders is sort of the the Westphalian view from 1648 right whereas on the internet we are now post Internet we're on the post Bitcoin world but we don't really care about law and borders we are everything's about topology not geography. And it's important to understand that the underpinning and legitimacy of the technologies in which we will organize society are not necessarily legally based right it doesn't rely on legal certainty which has a law and border but rather, and I try to use this as example, it's based on this stuff, right? This is this is a physical log, right, and so, it's a different kind of log because you know assuming no one has lock cutters in the room it doesn't matter what you think if you know the combination you can control the asset and so this is a sort of replacing or complementing legal certainty with a notion of cryptographic, certainty or minimally cryptographic consistency as a new way of of solving the problems which are washing up on our shores which require us to cooperate at global scale at a scale we've never seen before. 

The SDGs in terms of are there the 17 climate change is quite clear that we have a technology which is different, it doesn't respect borders because I said Bitcoin exists but the internet of trust which is the theme of today is really not something that jives would be entirely. I talked about since 2015 and the Asia-Pacific regional Internet Governance Forum, the notion is actually an internet for trust on a trustless internet, you know we have to now assume the Internet is trustless but connecting the Internet now there is a calculus before it would be very clearly good to connect the Internet but now if you connect to the internet you know geographies forever on the Internet, everyone's your neighbor and everyone potentially can be a bad neighbor or bad neighborhood, alright? Cybercrime, cyberspace, etc. So there new tools and our policy toolbox, which we need to have. And I ultimately think that whilst there's a lot of hope and whilst I say there's a new Westphalia which relies on the provenance and transparency this technology provides, that there is something which can be grounded and that is, that there is potentially a new social construct which we can't create using this technology. 

And that is why I think it's very important to recognize that currency is a starting point, we have these dowels we have smart contracts and maybe sort of a new smart social contract but what this technology can actually do is provide a new governance technology. A governess technology for nation-states where the border does stop and for all the global problems now that require coordination cooperation at scale, my, I think the optic I would like to leave you today is that this is ultimately a governance technology and how the governance of the blockchain technologies, to have that discussion is very important and I think that starting today and my other panelists will contribute, thank you.

>> CARLA L REYES: Thank you for starting us off, I`ll turn now to Primavera to pick up the thread.

>> PRIMAVERA DE FILIPPI: Thank you, just to perfectly continue on one thing I'll say, I think one thing that is really important to understand is that nowadays we have technology which is actually outpacing the capacity for governments to actually regulate those new Internet infrastructure. Whether it is because we are talking about those multinational corporation that are actually too big to be regulated by one single national state, or because we are talking about those decentralized networks that are actually transnational by their nature and therefore cannot be regulated with a jurisdictional framework. And then the other thing to understand is that, at the same time technology is actually an important proxy for change. 

The question then is how do we actually these technologies and how to do actually if they cannot be regulated in the traditional sense, like intervention then how do we actually manage, administer ourselves, govern those technologies in order to ensure that they are actually promoting the social good? And then, if we look at the way in which power and governments as actually evolved over the last twenty eleven ten years, then we can see that power is actually changing hands constantly and so the question now is whether blockchain technology is actually providing those new avenues for new organizations of power and new government structures or whether it is actually simply taking power away from existing structures but then it's actually reconstructing the exact same framework perhaps (inaudible word) like creating or enforcing existing power structures that it's a new type topology of actors that are taking this power. 

So, then if we look at the the potential of blockchain technology, then we can see that there is indeed an important potential for emancipations, for freedom and so forth but at the same time because this technology are escaping from the traditional rule of law, then you cannot enforce, you cannot ensure that those technologies are being used for a particular purpose. 

So because of this capacity that blockchain technology has to reformulate power then it becomes extremely important to actually look at the question of the governments of those technology in order to ensure that power is actually being properly distributed. Because if the underlying premises of blockchain technologies that we are providing these decentralize infrastructure for decentralized government and this decentralized power, then we need to make sure that there is no possibility of like reconcentration, because the actual decentralization of the infrastructuredoes not necessarily lead to a decentralization of power over this infrastructure and so we have those common problems known as the tyranny of structurelessness. In which when you have like a decentralized organization that doesn't have a formal structure then often you can see those new elites, and those new like invisible powers which emerge, which actually much less accountable because no one can actually see who is really making decision, who is actually having the power, and therefore people cannot keep them accountable, and there is therefore no transparency on the actual decision-making process.  

Then the second thing is that, in the end, the devil is always in the details. So, it's very easy when we have a new technology to actually see all the amazing potential and the new opportunities that the technology provides in theory. But the problem is that as we start implementing this technology then we actually starts seeing the details, and the details is where the actual problem emerge and that's the only way we can identify them and so most of the hype to the blockchain technology is because we are thinking about this technology in theory and obviously internally it has enormous opportunities and potentials but in the way it has been implemented so far then this is only under that we actually see the flaws, not because of the technology as such but because of the way in which it has been designed and the way in which the government's operates within those networks. We have seen interesting examples specifically when something is being is being created and then there is a technological design of how a particular system should work and then at some point we might realize that it doesn't work as intended that there is a dog, that is like a flaw in the actual design and then the question becomes if it has been codified into the technology then how can we operate in order to modify it. If the technological governments fails, then what kind of non technological offchain governments can actually jump in in order to modify the protocol, in order to change the code that is actually operating this network. 

This is how all the discussions around the need of actually reflection around the governments of blockchain technology has emerged, and this distinction between untrained governments which is government's by the infrastructure, and afterchain governments which is governments after the infrastructure. So, basically, to conclude like the ultimate idea is that governments biding infrastructure is really just an enforcement tool, so it's about baking into the fabric of the technology a particular set of rules, but then the question is always who defines the rules that will be baked into the technology and this is a process, this is not something that can be automated by technology this is something that requires human organization, and human consultation, and deliberation in order to then enforce those rules to a technological tool. So to reiterate what Pindar Wong said, we do need to create this kind of a new layer of trust on top of these trustless technologies and this is obviously a social construct that require very in-depth thinking about in terms of governance.

>> CARLA L REYES: Thank you. Rick? Would like to comment?

>> RICK DUDLEY: Yes, sure. So I have some notes on things that I think sort of ideals that are held in the blockchain community that are aligned with the development goals so I think that just a little preamble. A lot of people in the blockchain space are very anti-government or very libertarian but ultimately, I mean obviously I'm just speaking my opinion, but but ultimately you know libertarianism sort of lacks robustness right as a model. I mean it's it's not a full model for governance in many regards and so you have to in practice, you end up with de-facto governance, you end up with de-facto rules, to make up for the parts of the philosophy that didn't actually map to reality. 

So  these notes are more about sort of how do you sort of bridge that difference, there's there's you know this is sort of the blockchain view on one side which is in some regards a very much optimistic some sort of fantasy, and then there's actually building things that actually solve people's problems or are actually useful. So for me the one of the main major value propositions of blockchain technology, and in particular I mean obviously exemplified with Bitcoin, is the right to exit. The ability for you as an individual to not have your work be bound to some large arbitrary institution that you effectively have no say in. So this is an ideal that I think many people outside of the block trade space can appreciate and I think that you need this right to have people leave and enter social groups in order to solve complicated problems. You can't just be burdened or stuck with with people who don't want to be there or don't want to participate, sort of mucking up the system. In a similar vein, you know sort of the contract that we also need a meaningful concept of privacy in the contemporary telecommunication environment that we're in. 

So, you know, the ability for a dictator, or some other sort of person to exert an unfair hegemonic influence on a small group of people is enormous given how you know contemporary internet technology works. I can monitor all of your communications, I can intercept messages, etc, etc. A big part of the blockchain community's goals are to create privacy in particular around economic transactions but again becauseof the libertarian slant, which i think is a little narrow, there's an emphasis on economic privacy but blockchain technology more broadly can provide that same type of privacy to any other type of interpersonal transaction. 

I also think that one of the problems, again very much a personal problem, but I think does reflect the broader community. We have organisations of hundreds of millions of people and then we sort of pretend that we're all aligned. I mean, I'm here in Paris and you know I'm an American I didn't vote for Trump, right, I you know, I don't think he represents in many regards a mandate of the 300 plus million people in America. So, at some point, I think you know if we and also celebrating the end of World War I, you can have these these countries of 40 million people or ten million people, but that is categorically different from a systems perspective than a hundred million people and I think that really 10 million people is probably too many. 

So I think what a lot of the the value of blockchain technology, and in applying cryptography in particular signing messages, applying the technology to these sort of contemporary social problems. What it allows us to do is it allows us to self-select groups for us to create groups that are not geographically bound, groups of people that are based on interest and shared goals, and then coordinate those groups in a secure way, for the for the betterment or achievement of these goals that were discussed. 

I think that, ultimately, there's a fear. I think, well, I mean there's there's a large marketing influence in how block chains are discussed people are marketing, they're selling something and I think in selling something you know in this particular context, you know, a lot of people were selling freedom, you know, the freedom to commit crime maybe, as opposed to the freedom to escape persecution, right? Which I think is an equal, or frankly, more important  freedom to preserve. So, wraps up my comments.

>> CARLA L REYES: I think you're gonna pick up there?

>> COSTANCE TROY: What I have to say speaks to, you know, what would all of the people up here have been talking about. I wanted to just kind of reframe this and in terms of what we see as the promise of blockchain, which is this global infrastructure, that is to allow us to have a common, shared, state of things, in which we could coordinate and organize and count different things. Then we have, on the other hand, the sustainable development goals, which really speak to a shared space. This idea of a shared planet, resources, floor beneath which we won't fall, so that we can all rise as one humanity. It seems on its face that these things converge. 

But what we've been seeing in the development of the blockchain space, and and it speaks to how our understanding of what blockchains can do as infrastructure is changing from, you know, these isolated monetary systems to more global systems of coordination and governance. What we're seeing is actually, unfortunately, some playing the same the same game with with these new very powerful tools. So I can give you a few examples of that, you know, early on in the space you saw a lot of you know entrepreneurs and early pioneers that really talked about the potential blockchain, the narrative of you know lowering remittances, increasing capacity to participate in global financial networks, being put forth, but what these guys were actually building were new systems, new financial systems with even more intermediaries than before. 

So instead of having just the bank in the middle, you have a bank, the blockchain exchange, your wallet company, you know, the network fees, and so on, and so forth, which is quite ironic. Then, you know, a lot of the stuff that we've seen in the blockchain space is the promise of the failure of our government institutions, or, you know, as a response to our understanding now that that democratic processes have been hacked has been actually solutions that are reactions but still are operating on the same logic. So, you can see this in various examples, you know, the rise of nationalism, for example, is you know really the other side of, you know, a culture of fear, and exclusion, and other ring, which is a very old game. You can also see, you know, as a response to kind of the hacking of our democratic processes, in increased shift into a faith in algorithmic governance, data-driven policies, that actually take away the agency of people. 

Then, you can see solutions that are put forth, so things like radical markets. So this idea that you know we will do away with property, that everyone on a free-market basis will be able to bid for services, that ignores the structural power issues. People don't have the same access to resources or capacity for decision-making, which means that these systems will inherently fail on the same basis. And then, you know you have other promising solutions so you have the Estonian  residency program which reformulates on one hand this idea of governments competing to be service providers. So, on one hand that's really promising because for the first time you have government institutions whose confidence has been eroded by the people trying to serve their constituencies better. But you see a kind of a subtle sleight of hand which is instead of almost a philosophical reforming of the relationship between the state and the people, instead of you know governments owing duties and rights to its citizens, what you're seeing is the reformulation of governments or these virtual nations providing services to consumers, which is inherently an exploitative frame. 

So, what we're seeing actually are these technological tools that hold great promise and great power being used to recreate some of the same systems and accelerating the inequalities of that systems. So, you know, I think that all of us here have been working really deeply in the space see how this can be a fundamentally powerful tool for a fundamentally different game but in order to do so we actually need to come from a different kind of consciousness. So, you know, we need to use these tools this infrastructure to build more complex systems, that do things like provide greater agency to people that increase our capacity to not only make decisions but develop sense making tools that allow us to make informed decisions. To build, you know, even closed-loop supply chains, for example, that take into account externalities, that then give heft and weight to this idea of a common shared space. 

Things like coming from a more compassionate point of view, understanding that but for, you know, an accident of birth you could have been born in one country or another and that that we really need to have systems that enable people from all walks of life to be able to participate. So, you know, the one phrase that I heard recently, just really struck at me which is that, you know, the idea of the people is an idea, it's a concept, the individual though is a person. So, as we are building this infrastructure, as we are using these tools to create new new kind of communities using these this blockchain to be able to increase our capacity, to organize, to coordinate, to literally count different things, things that we value, that we need to constantly ask ourselves is this increasing our ability to inform and increase our capacity for agency on an individual level, and is the narrative that's driving this idea of the community or the people inherently one that is based on a consciousness that isn't exploitative, that's actually communal that actually can speak to the promise of this technology as a borderless and nonrival risk means of being able to coordinate as as a whole. And there's a lot of projects that are experimenting with these new ways. 

>> CARLA L REYES: Thank you, so first Primavera and then Constance both spoke of the way this technology could be used to recreate the same system. But Maria you're working on building a entirely different system.

>> MARIA GOMEZ: Yes. So, my idea is to present the project I work for as an example of how we're using this sort of new tools. Aragon is a project that has two parts. One part is, well, building an application and it's more like a platform where you will go, you download, and you will see different applications and different templates, and you can use those templates to create your organization on the blockchain. So, anyone can download that application and use those set of applications for free, doesn't matter where they are in the world. 

Those applications are for example the finance application for projects to communities to manage their projects in a transparent way. The survey application for these open projects to give a voice to their communities, and regarding certain decisions or all decisions. The voting application as well, and in the future we will have different governance applications like, liquid democracy, future key, and any project, any community, can use those different applications according to their needs. 

The other part of the project is what we call the Aragon Network, and that network is going to provide services to the organizations that opt to join that network, is totally voluntary, so people that want to join can join that network to find services like the decentralized core. So, the idea of the network is to provide a framework for the different decentralized organizations to interact among each other, to commercially transact in a in a trust minimized way. 

So, another service is the decentralized core, so if something happened there will be a core that will be studying whatever the problem that happened and we'll be solving that issue, according to the rules of the network. In the network we do have a manifesto, and that manifesto has the principles of the of the community, of the Aragon community, and such principles are like, for example, the descentralization of power. 

This is something that we are in the process of doing. So we raised a set of funds for the building of this project, and we want to give the power of those funds to the community. We have something that is the Aragon governance proposal and right now we are going to enter into the voting process as of tomorrow. 

So talking holders, people from the community that have Aragon tokens, they can vote on whether we should adopt that proposa ,the governor's proposal. And that proposal said the framework for the decision-making of the decisions regarding the use of the funds, for example, and also the governance of the Association. So the legal part of the of the project is a legal association, it's a legal entity that is in Switzerland. 

What else... Another principle is non-violence. So, like I said, whoever wants to join the network can join, and whoever wants to to opt out of that Network, can do it as well. Self sovereignity. So, that means that the user everything the data and and all the power is going to be in the hands of the user and we respect – we are going to respect privacy a lot. We we would love to have anonymous organizations and anonymous people participated in participating in the internet work. You can go to Aragon.org and and and see this project in real life, all the different things that we are trying to do with different set of tools.

>> CARLA L. REYES: Maria, who do you see using it?

>> MARIA GOMEZ: So, it's a good question. Right now, the first users of Aregon are technical projects. Projects like us that are building Network decentralized networks and that are building on open blockchains. But our end user, we have a persona and we call it Maria. And this Maria she lives in Colombia or in Venezuela in this countries that are very corrupted and where people don't have a lot of opportunities like people that are born here in Europe and so we will love that Maria to use the network search if for example can work for one of these organizations and earn in crypto, or she can set up an organization with different people in the world to do certain things, to build a network,to build an application, to build a website and get paid for that work.

>> CARLA L. REYES:  So before opening up for questions and comments in the audience, I wanted to give the panelists a chance to respond to each other, if you have comments for each other. Yes, Pindar?

>> PINDAR WONG: I`ve just been struck by the language we`ve all been using. Both the philosophicalideas, etc. It just shows you again the whole thoughtfulness of the people who are currently involved with the space and for some of the very complex, not only ethical issues, but political issues that everyone are wrestling with in terms of the design of this effectively software. So the thought  sort of I have, or one of my questions is you know are we replacing institutions with software? Right? Because again, we're losing the geographic view, right? Now you can choose which economy you can have economy without borders, right, you've got crypto token, you can join any community you have, you have the language of money within that community that is recognized, your political systems in terms of agency and how representation is. 

We – I've heard the word court, right? We have open law at i/o, we've got simulation of court law and contract and smart contracts. So, it's just kind of it struck me that you know this is a very pivotal time to have thoughtful people, again, everyone in this room to participate in these discussions. I don't – none of us are particularly qualified to deal with this morass but we can all contribute. But the freedom of thinking, in terms of these 2000 different career cryptocurrencies, all these different blockchains really strike to me is a Cambrian explosion of the potential that people will see. But without your participation in these discussions it's not clear how it's going to land, and if we don't land it, you know, decentralized doesn't mean disorganized right? We can contribute and we can shape things so I`m looking for the comments.

>> RICK DUDLEY: That all sounded good to me. That's most of my my comment. I don't think that we're ultimately replacing institutions with software. I think what is happening is people are in the process of trying that and it will fail and then they will realize like: “Oh institutions are made out of people, and now I have to deal with people unfortunately” and I think that that's sort of the the lesson. I mean there's a Bitcoin cash fork I mean I don't want to get all inside baseball here but I mean a group of people who were like we're gonna split off because of governance issues, we're gonna eliminate governance issues, and like three months later had a governance crisis. I mean it's like you can't avoid these problems in spite of really really wanting to. 

>> CONSTANCE TROY: I totally agree with you and that's – there's a key thing that we always have in mind when I was talking about the network, for example, that network is going to have a set of rules on this smart contracts but also we want you – like when organizations are transacting and entering into an agreement we want the rules said in a smart contracts but also we want to have like an agreement it doesn't mean a legal agreement but an agreement, a human-readable agreement. Because these organizations, even though if they are going to be running on on software, they are made of humans as well. So we cannot put all these different issues that can come up on code in code, we cannot codified everything. So we want to set up this agreement, human readable agreement, to talk about the intentions at this.

>> PRIMAVERA DE FILIPPI: And I think, to add to this, there is an interesting distinction that can be made between tools technologies and processes, institutions. I think that there is this kind of initial attempt, at least within the blockchain community, of taking the technology and providing tools that have the ultimate goal of actually replacing a process. I think this is inherently doomed to failure. And of course the technology and the tools can affect the government structure and can affect the government process but in the end, you still have a process and the process is a process between different actors and people and this cannot be replaced by technology. 

I think it's it's actually very – it's a useful distinction  because it enables us to see here is the process that we are unhappy with or that we want to change and then here are the technological tool that we can use not in order to get rid of this process and just replace it with that technological thing because then it's static and then it doesn't evolve anymore, but rather – what are the different mechanisms and tools and devices that we can create in order to transition and in order to improve the transparency, or whatever, the  outcome of this process while always focusing on the process and not on the actual technologies itself.

>> CONSTANCE TROY: And I think we have the the great benefit of the lessons of the internet. You know, Pindar was there from the very beginning and you can see how a system that was supposed to be global and democratic quickly became very very centralized. And so, how do we build into these kinds of technologies and avoid the same perils and avoid this entropy towards centralization? How do we create these feedback loops that make these systems constantly resilient to this this kind of entropy?

>> MARIA GOMEZ: To go with with Primavera as well, the tools are like – the way we see it, you know, the tools are the means and so for example we also think that these tools that we're building can be used by the institution's. Imagine a budget running on finance application on an open blockchain like like a budget from a state or from a government, so we can see what what is the decisions that are being made around those funds and how these persons are – the persons that are in power are using those phones or yeah. I think the tools that we are now creating are going to be very important to you know to use them as a way of check and balance of the centralization of powers that we have today.

>> CARLA L. REYES: Okay, so now are there questions from the audience?

>> AUDIENCE: Hello my name is Ian (inaudible word). I'm researching at the University of Geneva and thank you very much for your statements. I agree that replacing current governance by blockchain doesn't work because blockchain has not resolved its own governance problems yet and resolving the governance problems of blockchain is not easy as we see with our democratic society we are researching for centuries to find the best way to govern a democratic society and we're still not there yet. 

We have models that work, but they are not perfect. So it's no wonder that blockchain governancestill has to evolve. But I see a big potential that if we achieve good blockchain governance we can offer something to society to be an enabler for decentralized governance. But in order to be able to do that, we need some kind of legal frame. Because we – blockchain is not operating the – blockchain is not unregulated, blockchain is heavily regulated by a lots of Laws that maybe  heavily regulated by a lots of laws that are not applied yet but they are there. And we need some kind of protected space for decentralized governance and we need to define the rules, legal rules, the legal frame, of this protected space, like we have it in the New York convention of arbitration. So, meaning that if decentralized governance will stay within this frame, it should be protected against legal intervention. Thank you.

>> CONSTANCE TROY: We highly invite encourage you invite you to join one of the initiatives that we've we've started which is called A-Legality. It's all about exploring the space between these two code based systems and physical systems governed by laws. 

So what we are trying to do is build a translator, a gateway, wether figuring out what forms those may take in order for the systems to operate within each other – to interoperate. Because people are deploying these systems and these systems as you say have a have effect on the real world. They may control real property in the world, they may enter into contracts with human beings that are governed by lawsof the real world, they are subject to jurisdiction, they are they are a non-jurisdictional, they operate in this global digital space. But as soon as they touch the physical world they operate in this kind of bordered, Westphalian borders. 

So, what we are trying to do is actually build that bridge so these systems can communicate to each other and I think also to your point you know people often – the governance within blockchains is – we are discovering very rapidly in the last few years, is not about on chain governance. These rules self executing rules they're really about all of the social processes around those rules. So you know people often conflate for example decision making as governance but actually a large part of governance is sense making, so the things that happen before decisions are made, the things that decide who has skin in the game to be able to participate and make decisions. 

So, well we are where we're constantly trying to interrogate this and we would really – we'd love to you know invite you and others who want to participate and help inform this discussion because there's certainly been a lot of scholarship that we can learn from.

>> AUDIENCE: Thank you, my name is (inaudible) and I am a researcher from the University of Barcelona. Some of the point has already been made by the previous person who asked the question. So, for now maybe just very basic. When, from the technical perspective, when something goes wrong yeah when we were playing the blockchain who will take the blame? Who will take the blame and then just the prison. 

So, from the case now, wherever it is, maybe in Europe, in whatever is, how usually this – of the problem. So this is kind of the thing that maybe from the law and then from the regulation, we we will come with the solution. Because, like, there is a different mindset between when you learn social science and then the natural science. And then, I am also interested with how the regime of intellectual property works for blockchain so far? Do you have maybe, like as you are like, the people who involve there, are there many critical or maybe, I don't know, feedback that may be towards WIPO on how they should react in regards with is blockchain technology? 

And last but not least do you think that, given how the – because I hear that some of our panelists – I feel like you don't want that the blockchain to be treated the same like how the cyberspace where in the in the past. They have the cyberlibertarian and the cyberpaternalism but in the physical area it's always like, people are more likely, because the way we Humanity works for so long is by applying law and law usually is always important institution in responsibility with that. 

So yeah, I mean it's this will be complex but do you think it may be standard ethic or do you think that there will be like a certain type of institution, like maybe, I don't know international organization which conduct the blockchain and so on, because maybe it's a, I don't know, I think if you just randomly put it in maybe in WIPO, in ITU and and so on maybe it will be like misleading somehow in the future, thank you. 

>> RICK DUDLEY: I am happy to answer some of those questions. I'm not gonna necessarily answer them in order. I think generally sort of we call them crypto native people who have basically grown up in the blockchain. They're not going to agree with your last point, your your last idea of the creation of institutions. 

I mean I think that they would basically reject that concept out of hand. I know that I mean you know you end up with de-facto institutions you need to put the facto processes but to formalize that I think would sort of undermine... It's just it's not it's just not a model that that that is compatible with that type of formalism. You asked another question about who's to blame when when systems fail, and that one sort of perked my interest. 

So I for me, there's just in life, there's this important difference between blame and responsibility, right? You can point a finger and say you know this metal was faulty that's why this bridge fell but there was someone who's responsible for testing and built and producing that metal and there's someone responsible for installing it right and so there's a difference between like the blame and the responsibility. 

>> AUDIENCE: So maybe both.

>> RICK DUDLEY: Yeah, so I`ll address both. I think one of the benefits of the blockchain space and the sort of – and this will tie into, you had a question about IP law, right? Yeah, so the tie in to your question about IP because the technology is fundamentally open-source and we'll get back to that. 

Now it's very easy to blame people, you can say this person wrote this code I mean you can see there's there's a public log of everyone who committed the code now maybe those people are synonymous so maybe it's user 47 who made this error or maybe it was you know, Tom of you know, New York made this error but you can see you can see who made the errors. Oftentimes, the responsibility falls primarily on the individual to be aware, which is – obviously a bear an enormous barrier to adoption right I mean you need to be very technically sophisticated to be aware that these vulnerabilities that have been exposed and that there's an attack ongoing so on and so forth, etc, etc. 

Then I would think the next people who tend to take responsibility are the developers so the the core developers of a protocol are the providers of a tool that has a vulnerability in it, in the way the community exists today, oftentimes, even in a synonymous context for whatever reason, you know, maybe game theoretic economic reasons, it's just, you know, it supports their greed to take responsibility, you know, in the worst case. But oftentimes, people feel some sort of social obligation and core developers take responsibility, so I think looking at.. I mean the Dow is probably, for the people on this panel, the Dow hack is a very salient example, I think there's probably more recent examples that might be maybe  more relevant but in case the Dow, the actual people who deployed the code, frankly took a relatively limited amount of responsibility and the people actually operating the network, who really technically had no responsibility, took on that responsibility to provide a solution and there's questions about the governance, that went into that how you know that, the how did they decide, and how did that process go, and so I think that that sort of gives you some context about the contemporary environment. 

And I think that, for me, at least, as someone who was interested in these sort of philosophical questions, before the Bitcoin paper was published, I would like there to be some sort of, we were talking about this word the other day, some sort of technocratic process where everyone is educated. I mean you know this is a fantasy, right? I mean this is like a great Greek fantasy, right? Everyone is educated, everyone is participating in governance and because we all have that base of knowledge we can make intelligent decisions collectively. 

Now, of course that's not going to work, I mean they'll have to be delegation and there will be social games and social proof and people will be manipulated, and you know, as they are in the world today. But the goal is is to have a system where everyone can be... Everyone who participates in the system can be educated in what the system is doing, and the system is open, and transparent to facilitate that, and I think I'll cover three of your four questions. 

So I'll go back to the IP question, so in terms of IP again, for me, all the work that I do with my clients is all open source. So instead of having an NDA, I have sort of the opposite I say in a year from now if you haven't published the results of my work I will. And there's other people in the community I know who are consultants you have also fairly aggressive open source requirements for the work because the purpose is to again provide knowledge to a community of people who will use the knowledge not to enrich someone who has the capacity to file a patent. I filed a patent I have a patent it's expensive it's difficult the purpose isn't to continue that system.The purpose of developing blockchains is again to allow large groups of people to self organize I mean millions of people to form collective groups of tens of thousands of people, and I'm sorry there was a third question you had in there that I don't remember. 

>> PINDAR WONG: Just a reminder that these are in some sense very cold technologies, which is the point right? If you have the key you know, if you had the combination of opening the lock, and if the locks faulty were having their problems but the blame game is in some sense right now I think where we are is it's actually you're responsible. Why? Because it's the the choice, is all there but the transparency might not help because it's in code, it's what have you, the learning bar is very high it's cold and sofisticated but that will hopefully come down in a time. 

Right, I think that`s where we are, it`s cold and in some sense it's the opposite of the law, you have the intent. So how these two will relate to each other is going to be very very curious in the weeks, months ahead. 

>> AUDIENCE: Has there been a case, a legal case on misuse of blockchain? By applying the traditional law I mean like maybe or something like that but I always only if there hasn't been case that people bring the blockchain to the court?

>> CARLA L. REYES: Actually, there has been a lawsuit represented by David Muller and Sylvia Muller and the United States, and that`s a class action lawsuit against the Nano core of developers, a case called “Rescue Fork” and it remains to be seen wether it goes forward or not, but the lawsuit has been filed so that`s one to watch. 

There`s also an argument emerging in the United States, at least and I'm not saying I'm a fan of the argument by any means. But there's an argument emerging around places to place fiduciary duties on participants in an ecosystem and again I'm not particulary a fan of the  argument but there is a discussion around that emerging. You saw the former commissioner of the CFTC make a comment in his speech in Dubai recently that you could be responsible for quote “illegal smart contracts” if you reasonably knew that they would be used. So there is some emerging discussion under existing laws around where you can place responsibilities, where all of that falls out, it`s not entirely clear.

>> PINDAR WONG: There is also a slightly different approach which is actually to use the existing system to protect what's evolved. So you have people like [inaudible] the defensive paetynn strategies or in the case of for example Bitcoin using IP, which is payments which have actually been expired. So, for example, the use of [inaudible] if I get it right, in the iteration of the technology ahead, so it's actually it could be using the existing system to sort of reverse hack but to provide a clear safe space within which to innovate.

>> CONSTANCE TROY: And you'll see actually in terms of who's responsible when things go wrong, you're seeing actually a lot of innovative approaches. So, one of the things that Aragon, for example, is working on is creating a Court that has jurisdiction within the code based rule of dowse. So, these dowels would submit to jurisdiction by this digital court and it would be kind of an alternative dispute resolution that exists only in the digital space. 

And then another form might be, and this is something that a lot of blockchain companies are exploring with, is what happens when a smart contract goes wrong does it automatically trigger alternative dispute resolution process in the real world or address redress to the courts in the real world. So one is just within the digital space the other is if something goes wrong in that digital space a remedy in the physical space. 

And then what we're also discussing we just had a really great discussion last week and also last night about this is, could we because these systems inherently in these in this infrastructure, has a different architecture than the one that the existing laws contemplated, could we somehow create a mapping of a one-to-one equivalence? So that we could have a functional equivalence of certain things that operate in the digital space that would be recognized in the law in the physical space? So this, you know, of course requires a lot of work and mapping and translation and education and buy-in. 

But that is also another third way that people are dealing with these things but in essence I think we need to really think about what are the public policy goals of laws and how can these be achieved in the technological context or if not what kinds of new legal structures do we need to be able to accommodate for these things and we've we've seen this before on the internet and you know there are there are precedents for how we approach these problems and we need to just keep inovating on that.

>> CARLA L. REYES: We have a question from Remote Participants, it`s for Maria. They want to know how decentralized is Aragon network and how many people decide on rules and can you move with the decision without the core contributors?

>> MARIA GOMEZ: So it depends on how many – the people that can contribute or can vote is the people that hold a Aragon network token so that depends on that and also yeah I mean the idea is that decisions are going to be taken by the community of token holders regardless of what the core developers think. 

However, because this is very difficult so we are starting step by step so for example I was talking the Aragon governance proposal which is which we are presenting like the decision-making process that we would like to have in Aragon and the community is going to decide if if they – we open   that proposal publicly, like more or less a month ago, for people to contribute as well and and now we are opening for vote for the token holders to vote on whether they accepted yes or not or they reject it and and that proposal it's you know if those decisions are going to be taken according to that proposal they have sometimes if the decision is like very key on whatever happens with the project the Association which is the legal entity that is the owner right now of of the project, it's going to have a better power. 

>> CARLA L. REYES: Thank you for the questions, actually it is the end of our time but we would like to continue the discussing. We invite you to join the Dynamic Coalition on Blockchain Technologies and engaging our work. And hope you`ll contribute on a ongoing basis, we do the work year-round so don't let the discussion stop here. Thanks

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