Reigniting the Magic – Yves la Rose – EOS Community Conference 2019


hello hello hello everybody reigniting the magic so that’s the
that’s the talk today for EOS Nation we got a call months ago from the guys at
Rio and they started talking about “hey we’re gonna have this ECC number two, we
know you were involved with with the first ECC, is that something that would
interest you?” and I think it took about two seconds and and we said “definitely.”
this is the kind of thing that we believe is so important, this is the kind
of event that we think brings people together and there was something magical
about these events as wel.l I mean, we talk in telegram, we talked on on Zoom,
we’re together but we’re also so distant and coming together in events like this,
which we’ve had throughout the year it brings us somewhat of a shared
purpose, a common goal and so we wanted to recreate that, so we’re very thankful
for for first of all for Rio and Argentina for hosting us. Thank you very
much, because none of this would be possible without you. I mean, we send
money and we help with some logistics with the agenda but really the work is
on the ground. I’m fairly certain that the Rio team has not slept in a long
time and they’ll be looking forward to right? but for us, it’s more than just the
sponsorship, donating funds, it’s also making sure that everybody here is able
to come, because even if we have a conference but nobody shows up, it’s not
worth really much and ensuring that people are able to come and be together
and and discuss ideas where the challenges are, that’s that’s what it’s
all about. So, thank you to everybody who who’s here today. You should give
yourselves a warm round of applause do you have a clicker? all right thank
you, make sure this works. By the way I’m not really good at these people think
that I’m actually really good at speaking, I’m super shy. Yes I heard
somebody say pfft I’m actually an introvert and after this I need to go isolate
myself, because it’s like, I’m not joking and I read the welcome and thanks
because if not I always forget so, Seoul, South Korea last year, there was
something very magical about it. The timing of it, it was the first time that
most of us were meeting in person after the main net launch. There was somewhat
of a sense of shared purpose and a common goal that we were all that we
just all came off of. We had just launched the main net together, most of
us, we had build these relationships over several months, and for the first time we
were able to come together and there was it was a honeymoon period, everybody was
high, and the idea was that we were all in competition with one another, but
we’re all working towards the same goal and there was something very magical
about that and over the year that spirit of coopetition started
somewhat fading away, for various reasons I mean, we’re working on different things,
we’re trying to as a block producer trying to showcase what we are doing in
order to attract votes because that’s how we have a job and that spirit of
coopetition, after a while you could start seeing that it was breaking off,
and then certain things started occurring in the ecosystem and we were
working on large projects together and we did so much, we accomplished so much
in a short period of time and I think a big part of that was because of that
spirit of coopetition and that’s what the main net needed, in my opinion, at
that time. It needed a bunch of different teams that were all working in their own
respective decentralized ways to try and build something that they thought would
be more than the sum of its parts. And so many teams worked together on projects
many teams worked on projects alone and we had this
amazing amount of a value that was created, in my opinion, we created a lot
of the foundational tools that enable us to be where we are today. The main net has
seen so much progress in the last year certain things that we built did not
necessarily go as planned and there were unforeseen circumstances that we either
did not think of or we just could not predict, because there’s only so much
that you can predict and model and when it gets released in the wild and this is
part of the idea of the blockchain, you can’t really take it back. And so we had the
referendum that we built together and many teams participated on this and the
whole idea was to be able to give a voice to the token holders and so that
was created and we thought that well that brought challenges, because the
participation rate wasn’t necessarily as high as we thought, and the way was being
used wasn’t necessarily as, you know, the same way that we thought. We had the EUA,
which after eight, nine months of debating back and forth finally was put
into place, it was accepted, it was voted in and it replaced the interim
Constitution, the idea of the interim the interim Constitution was
always that it was going to be temporary and it took roughly eight months, nine
months, in order to settle on something that the community agreed on, or the
token holders anyways, now obviously some people did not like it, but at the end of
the day, the amount of voice that you have on chain is represented through the
amount of tokens you have and token holders spoke. And then we implemented
REX and the concept of REX was really great.
Finally we’d be able to have an area where if you wanted to have resources,
you could put in a little bit of Eos and in exchange, get access to a lot of
resources. But with that, and if you adopt an application obviously that would
significantly reduce your costs and in exchange, the token holders that weren’t
using those resources could put the tokens in there and basically make a
little bit of returns on their on the EOS that they have. That
also came with unforeseen circumstances that big change, a big significant change
was that it really effectively removed the 72 hours staking period and we’re
still living with the consequences of that today, and over that period of
the last 18 months or so, we went through a lot of growing pains and that spirit
of coopetition that I was talking about earlier, started fading away a little bit
that magic, that honeymoon period kind of slowed down. We realized that the token
distribution which many thought was really great and it was very very well
distributed maybe wasn’t that well distributed. There was a concentration of
wealth, we’re seeing the effects up to this day I think. In order to be in the
top 21 right now as a BP I think the threshold is 290 million EOS. We saw as
well that inflation redistribution became a thing. We effectively turned POS
or DPOS into somewhat POW. Your hash rate in EOS is the amount of EOS that
you have into your votes and you’re able to control your votes somewhat as
hash rate, and if you’re able to get a certain amount of free votes, that’s like
the own hash rate that you bring to the table and we saw that some players
started working together to coordinate their hash rate in order to take
positions of power. We saw that we put a big importance on decentralization, but that decentralization is a spectrum and it’s
not an offer on or off thing we battled with that, especially in the beginning,
when the chain launched, because we we were being attacked by blockchain
media left and right that EOS was too centralized. But they had a point,
it is centralized to a certain degree but it’s also very much decentralized. If
it wasn’t decentralized it wouldn’t be as chaotic as it is and if
you’re intimate with EOS you know it’s quite chaotic. If you’re into it, every
day, all the time 24/7, you know that it’s not centralized. There are parts of it
that are centralized but it’s quite decentralized, but we
struggled with that for a while and we put a lot of imports on that. And we
somewhat find ourselves in the last couple of months in somewhat of an
existential crisis. Where do we fit in the picture? What happens next? Where do
we go from here? especially block producers, and I can
speak as a block producer that because that’s what I bring to the table, but I’m
sure the applications are also having the same internal discussion, the token
holders are having the same discussion I’m sure the developers are having this
same discussion. What next? What can we do? Where do we find ourselves in this now
new place that that we’re in, in EOS? and there’s a lot of things that happen over
the last year and for me as a BP I started reaching out a lot, especially to
the the token holders that I knew, that were quite large and I wanted
to hear really from them what their criticism was. Because as much as I’m
sure I was doing good, I was pretty sure that I was doing bad things as well or
things that weren’t necessarily perceived as being value-add. And one of
the things that I that I heard very very quickly and often was that the role of a
block producer to certain token holders in part was to bring in new investments
and that that people were saying that we were failing. In the year and a
half or so that we were there, we did not bring in that much investment but that’s
a role that they thought that we should be playing. There was no large killer
that that came, there was many dapps, and many wonderful dapps, but we
don’t really have that one thing that people call the killer dapp yet. So
where was it? block one, what’s their role? questionable, I think everybody is not
even sure to this day, but we started seeing that their role is way more the
core code and perhaps way less that VC portion that we thought and that even
EOS VC doesn’t necessarily invest in EOSIO projects. We started seeing that a lot of teams also had questionable business models and albeit they might be really
nice people and really good at what they do
maybe not meant to survive. There was also a sense of entitlement. If I
launched the chain, should I be assured a spot? Shouldn’t I always be there? that
was an issue for some people decentralization, I touched upon it
earlier and we also started seeing the effects of globalization that aren’t
necessarily just found in EOS. So we see that I can’t compete with somebody in a
place where, for the same amount of price or the same amount of resources I can
hire one person they can hire twelve people. It’s not only in EOS, but we
started seeing the effects in EOS firsthand. But with this also came a lot
of opportunities. Opportunities to start discussing new incentivization models,
taking the incentivization model that we have now
and trying to adapt it so that we still recreate those incentives going forward.
we also started to look at how can we adapt to that evolving landscape? What
can we do? How can we fit in this picture? where’s my sphere of control? and where
can I have expectations that are met with reality? because I think for a lot
of people the expectations are far greater what then the reality is, that
causes depression. We also started looking at centralization. Is that
necessarily a bad thing for network security? am I really needed? and we also
started looking at: if our role is to bring something and we’re really good at
creating something from scratch might that be our role? for those of you who
are familiar with Peter Thiel he wrote a book “Zero to One” great book. I encourage
you to read it. Is that perhaps my role? can I perhaps take something from
nothing, create it to one, and somebody else will
scale it? because maybe I’m not that great at scaling. and so it brings us up
to the ECC today in Rio for the next couple of days, and the idea behind what
I’m trying to bring through this conference and why I decided to
participate and have a large role in this conference. Are we able to come
together in a place like this like we did in Korea and recreate that shared
sense of purpose? Create a common goal again, something that we can all work
towards. And we might not know how we’re gonna get there, but we somewhat agree
that that’s where we should be going. Can we reignite the magic? Is that possible?
Are we able to go back to where we were that feeling that we had last year, can
we go back to that? Is that possible? I think it is. How can we do that? perhaps
we have to look at our organizational structure, the way it exists right now,
with the block producers and the different stakeholders in the ecosystem
maybe we can reorganize that. The ideas that are going to be discussed
over the course of the day today there are presentations that are coming
afterwards. Some ideas of WPS, some ideas of perhaps a foundation and maybe what
the role of block.one is. Perhaps we have an insight in that, and how can we adapt
to that so I thank everybody for coming here
today I’m very pleased and very honored to be
able to launch this and to stand in front of you for the next couple of days
come together and try to create that sense of purpose. Let’s try to reignite
that magic. Thank you hey sorry does anybody have a question
any questions yes we’ll get you a microphone and I can’t
see by the way right now I’m being Hi, Hernan from EOS Israel. So, we saw
you guys, one of the first kind of let’s say Western BP’s that took um the
initiative of getting out of the kind of this “we are only a value-add in BP” and
start, starting to kind of open the open the spectrum and start to offer also
kind of a combination of value adding and rewards to the token holders right so how
how is this transition? How is that working out for you? and if also, do
you think that that’s like a productive model? something that most
bp’s should adopt? thank you that’s a really good question. Over the last year, I think when we started the main net, we had this idea that quid pro quo trading
votes, buying votes perhaps rewarding voters stakers, I prefer
the term stakers, rewarding stakers was bad it, was bad for the network
and we were gonna end up in a place or is gonna be a race to the bottom and
that was counterproductive to what we were trying to build and over the course
of the year a lot of discussions that took place and they started taking place
when people just started doing it and we were part of those discussions from the
very beginning and we, early in May this year, published a paper I wrote a paper
called staking as a service and I questioned whether or not we should even
engage in the discussion of what were to happen if the main net was continuing in
that direction and there was a lot of pushback with the article the idea of
just discussing the topic was taboo but while discussing the topic was taboo
let’s say in the West, definitely wasn’t taboo in the East and it was being done
so as much as we were not participating and it’s not even wanting to talk about
this, the main net was moving along without us. There was no stopping it.
because we can’t stop it and so we started having internal discussions. What
would it look like? and started having internal discussions on
what is value? and clearly token holders clearly on chain, are indicating that
rewards through inflationary distribution is valuable to them.
nobody can debate that, it’s on chain. So we started looking at how could we.. First
of all, where are the issues in those models? What didn’t we like about that
system? because if it’s just a question of moral dislike, that really doesn’t
have any ground, there’s not much you can do about that, that’s cultural, that’s
just the feeling, the chain doesn’t care but which parts of that didn’t people
like? and one of the parts of that people didn’t like that was clear was that it
could potentially affect Byzantine fault tolerance. It could
potentially create Sybil attacks, It wasn’t good for that chain from the
security point of view. but why? what happens for that to potentially become
an issue? and what we saw was that the people that were offering these rewards,
the amount of rewards that they were offering just wasn’t sustainable. You
could not do that at that level, if you did not, at a certain point, start either
trading votes, buying votes or perhaps creating a second block producer and
that was the issue. That was a big issue for a lot of people. Because if we start
creating a second block producer, not only are we taking away from legitimate
block producers, but we’re also potentially creating issues from the
network security point of view. And we started thinking how could we perhaps
tackle this system? Because I’m not a fan of just sitting on the sidelines and
just wishing it away, because that’s pretty much what we did for six months
and so we decided to create a hybrid model where we would offer.. and the
premise of that was: if I offer a lower APR, maybe there are people out there
that want to get those rewards, but they also want to feel good about themselves,
because they want to vote for block producers that they believe bring value
in the way that perhaps you think value should be brought. And that’s what we did.
So we installed a system, everything on chain, smart contracts and we have a much
lower APR than what these large mining pools are doing
but I don’t care, I’m not trying to compete against them. I was able to
successfully take roughly 6.5 million EOS away from them currently
right now, today, there’s seven bps most of them in this room. If I remove my
votes, they’re outside of standby BP position. I would think that that creates
value. Any other questions? and I can’t see. okay we’ll have coffee
breaks thank you that’s right Yves will be around
thank you




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