Kenny Rowe of RChain and MakerDAO, Part 2

Euvie: Hi crypto world, I’m Euvie Ivanova. Welcome back to part two of our interview with Kenny Rowe on the thought leader series. Kenny is the COO of RChain, an early team member of MakerDAO, and an advisor to CoinFund. In this episode, we talk about if crypto is a bubble, knowing when to exit crypto into physical assets, and where the industry is going in the future. We also get into some interesting futuristic ideas of how distributed technologies can play into [00:00:30] the idea of mind uploading, and the emergence of collective intelligence. For all the links and show notes, go to cryptoradio.io/kenny2.

This episode is brought to you by MakerDAO, a decentralized autonomous organization that creates and backs the Dai stable coin on the Ethereum blockchain. Dai is available for purchase on several decentralized exchanges, such as OasisDEX and Paradex. For more information about how Dai works, go to cryptoradio.io/maker.

Mike: [00:01:00] Welcome to Crypto Radio. We interview the top thinkers and entrepreneurs in the blockchain and cryptocurrency industry. We also cover topics like trading, investing, and ICOs. We’re your hosts Mike Gilliland, Michael Paul, Chris Sparks, and Euvie Ivanova. We’re entrepreneurs, crypto investors, and co-founders of a new blockchain investment platform called cosyndicate.io. We create Cosyndicate and Crypto Radio to make crypto investing a better experience for you.

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Kenny: When people talk about a bubble or things of this nature, it seems rather silly to me to talk about crypto being in a bubble. Any time an asset class of any kind can drop [00:02:00] 50, 60, 70 percent and then rebound, that seems like what a bubble should be. Crypto has done this 8, 10 times. In fact, it does it every three months or so. That is not our bubble. I don’t think crypto is going to deflate or crash or fail in the sense of a price. In fact, I think the exact opposite. Here’s why I think that. In 2008, we had a bit of a crisis, I’m sure you remember. All of that debt and all of those bad, toxic assets, the problem really didn’t [00:02:30] go away so much – the governments all said, “Hey, you know what we’re going to do? We’re going to print a ton of money and we’re going to give it all to the banks, because that’s our traditional way of distributing money. We put it into the banks and then it trickles down.”

That’s, for the last 100 years, how money has been distributed. The banks didn’t do that, they didn’t lend. They kept getting these larger and larger balance sheets. Where’s all that going to go? They’re not making any returns on stocks and bonds or, at least, not the same [00:03:00] that crypto is. If you look at other ‘luxury’ goods – boats and paintings, like high value works of art, all that other kind of stuff – they’re doing the same thing. Not quite to the extent crypto is, but they’re all really inflating very quickly. My hypothesis is that as soon as the Wall Streets of the world figure out really big pipes into crypto, it’s going to keep growing. That’s going to have, at some point, the tipping point is when everybody’s a Bitcoin millionaire, what’s the point?

[00:03:30] When enough people is… I don’t think the inflation is going to hit – hyperinflation – is going to hit the world economy through Fiat currency. I think it’s going to hit through cryptocurrency. That means the strategic bet here long-term is to know when to get out into hard assets. That doesn’t mean crypto won’t survive, in fact, it probably will do very, very well, but some of them are going to just get completely abandoned and some of them won’t, just like normal [00:04:00] revolution. Netscape is no longer around but Chrome and Firefox and all of those other browsers, doing just fine. I don’t know where it’s going to look but, at least, financially speaking, I think that’s kind of where we’re headed, maybe.

More from the other side of the perspective, the technology, I think that’s still I wide open question, whether we can use this technology to coordinate our species better. I kind of hope so, that’s where I’m focusing a lot of my time now. After I came from this corner of stable coin world which, by the way, Maker could be one of those things [00:04:30] that sticks around because all of those asset classes could be still mixed and put together so that you have a currency that’s still relatively useful as opposed to just being inflated away by massive inflows of capital. We’re not quite there yet, because they haven’t figured out how to do it. They are sneaking the money in – everybody wants to ‘get rich soon’. Anyway, that’s my hypothesis.

Euvie: Who do you think are the safe assets to get out into when that happens?

Kenny: Well, everybody needs a place to live.

Euvie: [00:05:00] Real estate? Gold?

Kenny: Yeah, you could do that. Gold has been traditionally an asset that’s weathered over thousands of years. It’s not super easy to move around. Sure, you could. It’s not easy to convert either. My guess would be, yeah, absolutely, real estate. Then, oddly enough, Fiat currencies will be… If everything movies into crypto, Fiat currencies will have a different flavour, especially the ones that are either limited in supply or actually have good governance. Maybe not [00:05:30] the Euros or the US dollars of the world, but I could see other smaller nation states. Singapore, for example, that could be an interesting currency to hold. There’s potential for X things you could do.

Other assets… I’ve been thinking about that, as well. What other assets could one purchase that aren’t stocks and bonds? I don’t like them too much but the other thing that should be part of a portfolio could be jewellery, those other hard assets, as well. The one I like the most is just real estate.

Euvie: It’s interesting [00:06:00] you say jewellery, because we have a friend who lives in Bangkok, he’s an Australian guy, and he is in the gemstone and jewellery business. He is a bit of an anarchist and he’s hoarding a lot of gemstones, a lot, a lot, a lot of gemstones. He thinks that when the world crashes, people will still want gemstones. I don’t know, that might may well be true. Sapphires and not diamonds, because they’re very controlled and artificially priced, but things [00:06:30] that are less controlled like sapphires and there are some other more rare ones.

Kenny: Actually, I’ll take that statement back. I think metals, potentially gemstone but especially metals, might not be a good long-term bet. What I mean by long-term, I mean 10, 20, 15 years. I think some of the stuff we’re talking about is really on that time horizon. I don’t expect hyperinflation to happen anytime soon. It might happen quickly or it might happen gradually, I really have no idea. It might not happen at all. When it comes to metals [00:07:00] and some other natural resources, I actually think asteroid mining is something that is not that far off.  If, let’s say, Planetary Resources, which is, I think it’s based here in Seattle. If they actually successfully grab an asteroid that is whatever, like 10 percent gold and 5 percent [inaudible [0:07:16], or it’s probably mostly water.

If you have those levels of additional metals and resources coming into the economy literally from space, that’s going to change and how they’re used, [00:07:30] as well. That’s probably a bit longer term but you could also think about other types of land not just here on earth. Martian land or titles to Martian land or infrastructure. That entire thing I think is fairly likely to happen. Space X and Blue Origin are making a lot of progress in that field and it seems almost like a manifest destiny at this point, that we’re going to go to the moon and put some habitation there, probably Mars. Further out in the solar system, [00:08:00] either one of the ice moons or something like that could also be an interesting place to colonize, as well. That’s far out, that’s really crazy. What are the later projections, like mid-2020s, that’s when the first flights to Mars are going to start happening, something like that.

Euvie: That’s crazy.

Kenny: That’s not that far away.

Euvie: Yeah. Suddenly, a lot of things that we think of as rare resources are going to be completely flipped upside down because there’s just, pretty much as far as we can go with our space ships [00:08:30] at this point.

Kenny: Yeah, of course I always think it’s a good idea to bet on technology. I don’t know where tech is going to be in 10 years but I have a feeling it’s probably going to be just as weird as it is today. There are probably going to be just as many opportunities and just as much risk. Having well diversified base is always good, then there’s other really easy things you can do, too, which is, “Pay down your debt, don’t carry debt, don’t be obligated to other institutions,” as much as you can anyway. Live within your means. Yes, even if you do [00:09:00] have a lot of resources, buying three Teslas might not be a great idea just because you don’t know what’s going to happen tomorrow.

There’s some really basic financial wisdom to all of this and to never really put all of your eggs in one basket. I won’t say that I have any insider information – well, nobody has any insider information about what’s likely or not likely to happen. There’s a few things that have happened in the past that I think most people would tend to feel are true; in 2008, during that financial crisis when there was a massive credit crunch [00:09:30] and loans and the economy was almost grinding to a halt, at least here in the United States and a lot of other places, too, just because that has a massive ripple effect. The money that was created subsequently – and a lot over time, not just in 2008 but in 2010, 2011, 2013 – continually over years and years, massive, massive amounts of capital inflows into the banks.

The core interest rates, the core consumer price index, not moving really at all and, a lot of times, [00:10:00] actually floating down. I remember talking about this six or eight months after the financial crisis in 2009 with a friend of mine, being, “When are we going to see this massive inflation? Where is it going to come from?” We all thought it was going to happen in the stock market. If you have looked at the stock market, it definitely has continued to ramp up quite a lot, at least for its own compared to itself, over the last five to six years. I’d say, yeah, there definitely has been a lot of [00:10:30] money pushed to equities and to some other things. Not nearly the amount that we should be seeing someplace, because there’s a great economic book called This Time is Different, I think it’s 1,000 years of monetary…

I can’t remember what the subheading is. It’s basically the hypothesis of the book is actually, “No, this time is not different. As soon as monarchs and as soon as central powers decided to debase their currency, it’s only a matter of time before the currency collapses and fails and something new has to take its place.” I think that’s true, I don’t [00:11:00] think this time is different. It’ll be very clear in hindsight once it happens, how about that. I’m almost positive. My hypothesis that I’m working with now is, “Perhaps US dollar debasement is not going to be that it cost $10,000 to buy a bag of groceries,” thought it could. I actually think what’s happening with cryptocurrencies is that also ties into that time period. I think what we’re seeing here is massive capital flows coming into a new asset class.

[00:11:30] This new asset class has returns that are unheard of in living memory. That also doesn’t mean that these kinds of assets classes have never appreciated at this level before, it’s just nobody alive remembers anything different. All of the bankers, all of the hedge funds, all of the traders, all of Wall Street, all of Main Street, is looking on what’s going on and happening crypto, I’m going like, “Okay, if I buy $100 worth of Bitcoin and I sit on it for a year, then I have [00:12:00] $10,000 or maybe $100,000 then. Okay, I think I can afford that. And that’s kind of what we’re seeing in the last three to five years but you always get these shocks where everybody’s like, “Whoa, it went down,” and they try to either panic sell or something like this.

You have this huge amount of volatility but then you also have this pervasive [inaudible [0:12:20], where people just buy it and just sell it. Where this is all ending up is I don’t think the massive amounts of capital [00:12:30] that exists in the [inaudible [0:12:31] of the banks has found an efficient of getting into crypto just yet. I think most of the increases we’ve seen have been fairly organic, some institutional, some other sell off of other asset classes, then transferring into these, some value creation, and just a ton of speculation. Where does that all leave us in the end? The thing that I can’t get my head around is, “Well, if everybody or the vast [00:13:00] majority of people in 10 years are Bitcoin millionaires, what’s the point?”

Inflation might happen in that way; everybody becomes crypto wealthy. The issue is when everybody becomes crypto wealthy, we’re just at a new plateau, we just reset to where we were before. Some people are better off, some people are worse off. Now, it takes five Bitcoin to buy some eggs or whatever. I think that’s where inflation is going. I think it’s fast moving into crypto [00:13:30] at a pretty significant clip. If you look at the log charts, which are much more informative than the linear charts on Coin Market Cap. You extrapolate that out we are looking to hit a trillion dollars in market cap probably by the end of the year, maybe within the next few months.

Then that log is 10 X at each step. This is like the Richter Scale we’re talking about here. Just do the math, if it’s 500 trillion in 5 years and we only have 6 billion people and it’s a [inaudible [0:13:59] [00:14:00] distribution where 20 percent of the people hold 8 percent of the wealth, yeah, that’s just where all the inflation is going to happen. I think a skilled or investor if that’s the right word, someone paying attention to this, should see that trend line and diversify into things that are physically important, like housing. It’s probably a good idea to own the place you live if you can.

I’ve actually spoken to a real estate friend of mine, she’s like, “You know what, [00:14:30] interesting thing. This Bitcoin thing, I’ve had a couple clients come to me this year and say, yeah, they did really well and now they want to buy a house,” or something like that, or have enough for a down payment now or whatever it is. When I started hearing my real estate friends saying things like that, I’m not the only one thinking this way. That’s my hypothesis on where things might go. I could completely wrong, I have no idea really. This seems to be intuitively correct to me.

Euvie: Yeah, I remember Vitalik saying the exact same thing when people asked him, “If you weren’t just holding crypto, where would you put it?” [00:15:00] He said, “Real estate.”

Kenny: Yeah, you need a place to live, period, everybody does. That being said, I think we could do a much, much better job of housing as opposed to land. I’ve heard the example made – the way we build houses now, it’s like if you wanted to buy a Tesla and then the 16 engineers came to your garage with a truckload of parts, then literally assembled it in your garage and hooked it all up, that’s the way we build houses right now, which is stupid.  It doesn’t make any sense. [00:15:30] I really do hope that we can get to a place where housing and some of these other types of things that are vitally important for society and human living are much, much more efficient and affordable.

That being said, the only thing I’ve seen so far is basically the [inaudible [0:15:42], that’s the only thing that’s industrially scalable that’s semi-permanent that can actually work for low-income families or low-income individuals. Right now, it seems to be the only people using it are the people at Burning Man. Typically, what happens at Burning Man tends to find its way out into the rest of the culture fairly quickly. [00:16:00] I have hopes that we’ll have the [inaudible [0:16:02] in the not too distance future.

Euvie: Yeah. On your chart that you were looking at, the log chart, at what point does cryptocurrency become hyperinflated enough where you should get out? Have you actually looked at it? Can you make a prediction?

Kenny: No, because predicting things is very difficult, especially about the future. Intuitively, I think the adoption cycle for crypto in general are still [00:16:30] at the innovator phase. We’re getting closer to the early adopter phase, which is about, I think the early adopter is 13 percent of a market or something like that. Sounds right. Maybe the first seven percent is the innovators. 13, then you’ve got the early majority. My guess would be on that adoption cycle is really more of a metric than what the price is at any given time. Diversification is always a good idea, it doesn’t matter what the price is. I would never tell anybody to [00:17:00] sit and wait and try to time a market.

Timing a market is just a recipe for disaster. The way I typically allocate my own money – this is not advice, obviously I’m not a financially adviser, I’m just describing the technique that I use. For the income that I receive, whatever that happens to be, 90 percent of that goes into what I might call operating expenses: paying my obligations, saving for the future (this is just literal savings, right), housing, food, [00:17:30] entertainment, all of that stuff. That’s 90 percent of my income. Then I take 10 percent of my income for investments. Now, you have this 10 percent. That 10 percent, I use 90 percent for generally safe or well-known investments, things like stocks, things like bonds, other traditional assets.

Then 10 percent for highly speculative investments like crypto currency. You do that over time. You never spend more – you try not to – spend [00:18:00] more than you earn at any given time in your life. Don’t take out debt that you can’t manage, reasonably manage. Always have at least six months of cash on hand. Be careful about what line of work you’re in. There was a lot of conversations with my family about, “Is this really a good idea or not?” We really spent a lot of time thinking about it. Once you have that plan in place and going over time, likely your speculative investments most of them will [00:18:30] fail but occasionally a few of them will work out really well, then you’ll have a giant spike in income, hopefully.

Then what you can do after that, is then redistribute. I won’t tell anybody to try to time a market. What you should be looking at is your own portfolio. If you’re investing and your managing your funds correctly and it’s becoming out of balance, like where you want it to be, then rebalance it. That’s when you start doing it. You should do that even with a 401K. When you’re younger, [00:19:00] it should be more risky and when you’re older it should be reallocated to things that are more stable, like cash. This is fairly vanilla advice. I’ll just say that for the first part.

Then something a bit more interesting, yeah, I’ve looked at this trend line, right. I’ll say two things about the trend line. One, rarely is the case where if you put your finger on some point in time and say, “Yeah, that’s going to be ridiculous,” it’s rarely ridiculous when you actually get there. I also find that that same thing [00:19:30] is true about technology in the future. We love to speculate and think about what the future will be like but we’re never that impressed with it when we’re actually living in it. Look what we’re doing right now. I’m sitting on my couch talking to you guys thousands of miles away on a video call that’s going to be then put out to many more thousands of people.

This just wouldn’t have been possible 10 years ago, at all. But we do this every day and you guys are fully aware of that. Yeah, you could do something where you can stick your finger on a chart and say, “Yup, that’s gonna be crazy town, [00:20:00] I’m gonna get out then.” But crazy is a state of mine; if everybody’s like you, then it’s not so crazy.

Mike: Yeah.

Euvie: Yeah. What are some of the most interesting things happening in the crypto space for you right now? What are you super excited about?

Kenny: Okay, this is great. Been talking a lot about finance, right. I actually don’t care. I mean, it’s interesting, I do like to watch the price. When things go up, I feel great. Finance is a good thing to have additional options. [00:20:30] The things that I’m really excited about and really looking forward to really seeing what’s possible are things like group intelligence or something like a hive mind, something like that. I think we might have the technology to produce something very interesting as a group. Let me preface this a little bit. I view the world as in orders of magnitude. Yeah, orders of magnitude and they’re sort of reflective in each order.

Euvie: Like fractal.

Kenny: Yeah, yeah. [00:21:00] Fractal is another great way of saying it. In the human body, it’s trillions of single celled organisms cooperating together to build a larger system. That’s what the animal and plant kingdom is. We originally started out with just single celled things but they figured out a way to do something in higher complexity. Any individual cell has no idea about the larger self that it’s a part of. The understanding it has is not the same understanding that we have of it. [00:21:30] We also don’t worry about losing some of our cells. We literally shave them off, cut them off all the time. We’re not that worried about it. If you think about it in that sense, that’s a little weird.

But there is communication. A lot of this is biologically inspired but I’ll go into that. There is communication between the individual cells in your body and you as an organism, that is mitigated through chemicals. If you take a pill that’s going to have some physiological affect because that pill has chemicals in it that change the biochemistry [00:22:00] of the entire system. That either changes the higher-level organism or the fundamental interactions or both. That’s the way that works. The same is true the other way around. If there’s dysfunction in the system, it will produce chemicals which make you have a headache or become depressed or whatever else.

There is interconnection and interplay between orders, between magnitudes. I think what really interests me [00:22:30] is not that if it’s possibly, it’s obviously possible because it’s everywhere around us, even to the point where if you think about molecules creating objects, it’s the same basic idea – strong and nuclear, strong and weak forces connect, used together to follow simple physical rules in order to create things. We have larger structures, as humans we call the societies or cultures, these other higher-level organisms. What I don’t know is how conscious are these organisms, how developed are they?

[00:23:00] Just like single celled organisms evolved eventually into multicellular organisms, there was a time when there weren’t any multicellular organisms. I think humans could be building blocks for something greater, higher-order, and very likely to be actually. I think that thing exists at least in some way now, I don’t know how conscious or how developed it is. My guess is that it were somewhere around the protozoa to maybe fish stage.

Mike: Early nervous system.

Kenny:  Yeah, early nervous systems. [00:23:30] We’re actually connecting all of the pieces in certain ways. That’s probably very true. It’s early nervous systems. I think potentially we’re getting to the point now where we might have tools that can create consciousness. If that is the case, that is very interesting and I think there’s also a likelihood that we could create communication between individual humans and the higher cell. Just like there is communication between your cells and you, [00:24:00] there needs to be some level of translation, right, so the narrative that we will understand will literally be a narrative, a story.

What the larger organism understands is likely not a story, it’s something else. To that same point but also scary, the larger self is probably not going to be that concerned with individuals, right?

Mike: Yeah.

Kenny: Then other metaphors come to mind like cancer. There’s a lot of movement in the techno religion space of living forever. [00:24:30] If you ask Ray [inaudible [0:24:30] or any of the people working on infinite life extension, they think it’s very possible. Yeah, that happens with cells too, it’s called cancer and it destroys the organism. We need to be careful of that. There might be a really good reason to die.

Mike: Yeah, I think so. There’s a lot of stupid people on this planet and, if those multiplied forever infinitely, not to say there’s such a difference because we’re all ignorant, but to say that we’re going to multiply and [00:25:00] also live forever, I think you’re exactly right. That is definitionally cancer.

Kenny: Yeah.

Euvie: Yeah, there’s a very good reason why people die. I was looking at some research actually, exactly the kind of anti-transhumanist research that shows why we die and why it’s useful for the genome, because the organism here is the genome. The genome absolutely does not care about the individuals. In fact, that senescence and death is very beneficial for it because it cuts out the bad genes, it cuts out the bad mutations, anything that threatens the [00:25:30] genome itself.

Mike: If you think about how bad we are at adapting generationally to culture and changes in culture, how bad our parents are at adapting to internet culture and that sort of thing, we might think naively that we are adapting fast because we were born around the time of the internet and things are changing super-fast in our lives. But we don’t know what the next Cambrian explosion event is going to look like for us, the internet generation, and that could be another order of magnitude of change that we’re not prepared for [00:26:00] that, if we were to figure out how to live forever, we would basically fuck it all up because we’re not allowing for that next generation to takeover.

Euvie: Yeah. Did you listen to our episode with Jordan Greenhall where he talked about collective intelligence and how his teenage daughter and her friends are having this insane level of collective intelligence that he has never seen in adults his age before? He thinks something like that is happening right now.

Kenny: Yeah and they take it for granted. They’re like, “Duh dad, come on.”

Mike: Exactly.

Kenny: Minecraft or something like [00:26:30] that, right?

Euvie: Yeah, yeah, yeah. They were spontaneously cooperating in Minecraft.

Kenny: I have this odd thing in my head. I remember where I was any time I hear something. When I listened to Jordan say that, I was literally a couple blocks down from house walking along the water and just being like, “This is amazing.” Let’s take this one weirder step further – where I think this might and how this might evolve. The tools and the setup for how this might happen. I think blockchain technology, [00:27:00] yes, will be a component to that. I don’t think it’s the end all, be all, mostly because the actual interesting bits are going to be the interactions or the, let’s call them, rules or the software, not the pervasive underlying infrastructure to persist that, though that is important, it is a requirement.

Another thing is our body is made up of literally trillions of individuals. We have billions now, that’s not enough I don’t think. Artificial intelligence is interesting [00:27:30] but I also don’t think it’s well-developed as people think. Here’s something that I think is fairly straightforward. Human emulation requires three basic things. The first thing you need some substrate in which to house the mind. This is a computer. We have plenty of computers now that are close to the level or getting fairly close to the level of what the brain can do.

They can’t do it nearly as efficiently. They can’t do it quite the same way. They’re still massive, they’re the size of [00:28:00] buildings. They take up huge resources but we’re fairly confident that, within several [inaudible [0:28:06] of Moore’s Law – I’m not meaning Moore’s Law in the sense of transistors stuffed on a piece of silicone – but the way computers are miniaturizing, becoming more efficient, something as powerful as a computational substrate as the human brain would be fairly achievable within the next lifetime. Let’s just say that – lifetime of a human. Somebody born today, [00:28:30] that should be almost without a doubt possible within their lifespan. That’s one thing.

The second thing is you need, if you’re going to emulate humans, you need a high enough resolution scan of some kind about the structure of a brain and the state of that structure and system. This is also assuming that the brain is some sort of computational thing, which it obviously might not be because people thought the brain was clockwork when clocks were the most dominate [00:29:00] technology in the world. But let’s just assume, which could be a bad assumption, that it is computational of some kind. One, we think we probably could have, within several decades or less, hardware that’s adequate to the job. Scanning technology is rapidly improving on those same axes, so it’s fairly reasonably to think that we would have scanning technologies of some kind, not necessarily uninvasive meaning they could be very invasive, literally cutting the brain out of a person and slicing it up, that’s most likely [00:29:30] to be the most efficient and most high-resolution thing first.

That’s also going to be fairly straightforward or happen within the next few decades, those are the first two things. The last thing you need is a model of how the brain does what it does. This is like discovering the Bernoulli effect of flight. Everybody thought you needed to flap your wings, right, because that’s the way the birds do it but actually, it’s not, it’s just a surface where the air pressure is higher on one top or the other and the creates lift. Now, we have jet planes [00:30:00] and jet planes don’t flap wings, right. The model of human cognition and consciousness potentially is far less straightforward whether that’s one, even possible, or how close we are. We have some rudimentary models that do some interesting things – we have progress, at least. The hard thing about models is you tend not to know how close you are to the goal until you’ve actually achieved it.  That’s when it’s much harder to put a time on it. It also seems trackable.

All three of those things seem more [00:30:30] trackable to me than black box AI, or artificial general intelligence, or any of those things. I just think it’s going to be easier to emulate a human more economically efficient, because it’s got more benefit right away. Whereas an artificial intelligence, you have to train it to do something. If I can just either scan, or if a really great office worker donated their body to science and I can reconstitute them and then they can just do a counting for me. In fact, I can just make 50,000 of them and do [00:31:00] accounting as a service, something like this.

You can see a clear economic value for emulation of humans and there’s very, very little cost to running an emulation, in fact, your cost is pretty close to the economic value that can be created. Alright, where are these humans going to live? Well, virtual spaces seem adequate for them. They would be far richer than everything we have today. You add some interesting technologies like blockchain, [00:31:30] which can allow digital worlds to be decentralized, meaning, not centrally owned, and still consistent. Typically, in virtual spaces you couldn’t have both. You needed a centralized organization to provide consistency and, if you had completely decentralized virtual spaces they had no consistency because anybody can do anything they want and nothing makes sense.

Once you have both of those things now you have a place for people to live, you’re only limited to the number of humans by the amount of hardware. If you just look at how quickly Bitcoin mining increased in size, [00:32:00] the economic value of creating new humans or copying humans is likely to be orders of magnitude more than that. Everything that they’re doing is likely to be digital, so that’s also cryptocurrencies or software mediated interactions. You can quite easily see how something coordinating at the level of trillions could produce something like a complex organism like an animal. I don’t know whether that thing is going to be like a human, meaning something that’s conscious and aware of itself but [00:32:30] we’ll probably have organization structures right now that have early at least underpinnings of a nervous system, which was what our networks were starting in the 60s. With this next iteration, when there are literally trillions of intelligent organisms interacting, you’re going to get things like animals.

Euvie: There’s a super interesting theory of consciousness that two neuroscientists are working on and they’re Julio [inaudible [0:32:55] and [inaudible [0:32:57]. They’re working on a model, [00:33:00] I can’t remember what it’s called but the idea is that consciousness is basically a feedback loop within a system that has a certain number of nodes and has enough differentiation between the different kinds of nodes, so enough variety of types of nodes. What you’re saying is actually very, very interesting, because if we look at those types of factors, you addressed one of them, so we need enough nodes to begin with to create complex enough systems but we also need differentiation between the types of nodes, and having bio-humans and emulated [00:33:30] humans in the system would provide that differentiation.

Kenny: Yes, remember the emulated humans are going to run potentially millions of times faster than humans. There will literally be lifetimes and eons, rises and falls of civilizations occurring within, hours to days.

Euvie: If you look at the human body, it’s the same thing, some of the parts of our brain are very, very old and some are very knew. There are certain parts of our body like cells that [00:34:00] stay in the body for five years and some cells are replaced every few months. It’s kind of the same. Some cells are huge in size and some cells are tiny.

Kenny: I don’t know how these systems are going to interact, my guess would be the human race, the biological version somewhat retires.

Mike: Goes on permanent vacation.

Kenny: There’s levels within this emulation world, because it’s more expensive to run faster. Not all emulations can run at super speeds. We don’t have any problem [00:34:30] right now communicating over light speed between our two locations. We get just a little bit further out and we can’t communicate, right? You can’t have the same conversation with somebody on Mars, this doesn’t work. The same way in this emulated society. The ones that are physically located in the very heart of the computer will be running the fastest, will be the most expensive, will be the most highly productive, will be the highest class of society, and they won’t be able to communicate very well with lower levels.

Then when you step down the levels, [00:35:00] you step down in speed and the base level is human speed. I think probably this whole society will run its course within several years, like in human years. It won’t take long, especially since you can imagine if you have non-invasive scanning you can scan the best and the brightest, I don’t know what they’re going to come up with in 2,000 to 3,000 years. That’s how much time will have passed for them.

Euvie: Especially if they’re self-amendable somehow, if they could optimize themselves and exchange data with other entities and learn from each other, [00:35:30] that thing is unstoppable.

Kenny: The level of interactions is likely to be astounding.

Euvie: Another interesting thing is if we look at these technologies, they’re not quite there yet but you could create a very rudimentary version of this where you could have a primitive brain scan and the somewhat primitive model that maybe doesn’t fully mimic the complexity of a human brain. Then you could have some sort of learning algorithm where it could interact with a bio-human and try to amend itself to mimic maybe closer [00:36:00] to what a bio-human is like, then based on that new complexity it could self-amend further.

Kenny: Who knows, right? I would like to recommend a book for everybody because a lot of these ideas are very inspired by Robin Hanson.

Euvie: Yeah.

Kenny: Robbin wrote a book the Age of Em. His book is very dry and very profound. It’s not a story, it is a description of Future World which is just as boring but crazy as ours. He makes an [00:36:30] analogy…

Euvie: Just as ours.

Kenny: It is because it’s not a story, there’s no protagonist, there’s no arc of anything, it’s just like, “Yeah, here’s how much computation it’s likely to cost,” and it just runs through the equations. It’s like a manual for how the world would be if this was possible.

Euvie: Robbin Hanson has a very interesting brain.

Kenny: People really dislike his ideas. I would say normal people. I love his ideas, I watched him on Sea Span once and the questions he got were sort of like, “[00:37:00] Are you Dr Evil or something?” That’s what it felt like.

Euvie: I find it fascinating listening to the idea of neuro-atypical people, I think that’s a very good term that I learned recently. Basically, people whose way of thinking is completely not what we think of as normal but are still brilliant and sometimes might have significantly lower or higher functions that we consider vital, for example, empathy. Somebody who has low empathy but very high IQ could come up with really wild [00:37:30] and very probable scenarios that people think are completely unethical.

Kenny: Yeah, essentially. And the vice versa, right, somebody with immense amounts of empathy can inspire.

Euvie: Alright, I realize we’re running out of time here, we just have to wrap it up here. This has been really fun.

Mike: How can people get a hold of you? Where should check out your projects?

Kenny: Yeah, for RChain, it’s just rchain.coop. MakerDAO is makerdao.com. Both of those projects have got great websites and places you can learn more and [00:38:00] links to GetHub, social media accounts, everything’s there on the web so do check it out. Then if you want to talk with me or other people involved with the projects, there’s a link on the RChain website to our discord chat, where you can chat. There’s also a link on the Maker site for the chat, which is I think chat.makerdao.com.

Mike: Cool, thanks Kenny.

Kenny: Thank you very much.