🌴⛓ Chainletter - Issue #3

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🌴⛓ Chainletter

Our new weekly newsletter covers Chainforest - a recap of our latest happenings, our members’ accomplishments, and our projects to come. You’ll even find featured pieces written by the community and conversations with our members!

This Week! - Chainforest and the Runners, a PhD in DeFi, and the Sofia Cossar Interview on Blockchain's (potential) Application to Government and Law.

Chain(forest)runners 🏃‍♀️

Thanks to alpha in the NFT channel, multiple Chainforest members have invested in what some are considering the next Blue Chip level NFT project - chainrunners.xyz. What started with Amit stumbling upon tweets from the likes of Dylan Feld, Gaby Goldberg and Sarah Guo endorsing the project, has now turned into a community journey following a promising NFT project since launch. Despite a rather bearish NFT market as of late, Chainrunners has a very bullish future ahead! 

So what makes Chainrunners stand out amongst the rest? 

1. ART ON-CHAIN!!! Why is this important? This could be an entire article on it’s own, but to summarize…because most Web3 creators are stuck using Web2 (centralized) services for NFT filing and storage. Woof. Also, security, valuation, and liquidity are improved “on-chain” vs “off-chain”. 

2. Additionally, known NFT tastemakers like the art, creators, and community. These are strong signals that you’re investing in a solid project with real staying power versus an over-hyped pump and dump. 

Launch/mint community: 

• How to track specific wallets (known whales) and overall minting actions of projects to assess the success of an NFT launch plus potential market opportunity 

• Determining rarity of your mints 

• Tips and tricks for managing high gas prices 

• Tracking price action after launch (ETH - mint was 0.05, current floor 2.428 at time of writing - OpenSea)

Post-launch/mint perspective

• Per Amit: “It’s a different experience being involved with an NFT project from launch - seeing the community form, seeing the FUD come and go, watching the price fluctuations, watching runs on different attributes, etc. every NFT collection is its own market within a market.” 

Community Perspectives 🎙

PhD in DeFi

What curriculum warrants earning a PhD in DeFi? This week in #defi, members dove into the question initially posed by Amit. A (very) loose final iteration of topics included: 

• AMMs (Uniswap, Curve, Sushi)

• Compound

• MakerDAO

• AAVE

• dYdX

• Stablecoins (USDC, USDT, UST, LUNA)

• Ribbon, Yearn, Mirror

• IndexCoop

• Synthetix

• Olympus

• Abracadabra ecosystem

As DeFi protocols continue to study, innovate, and gain inspiration from… you guessed it, other DeFi protocols, it may make sense for you to do a deep DeFi dive (if you haven’t already) to gain a baseline understanding of how the “classic” DeFi protocols work, different tokenomics models, and be able to understand new emerging protocols. Stay tuned in #defi for a roundup of reading/viewing material and prepare to earn that PhD!

Terra Learning Session

Friday marked the start of the first Terra learning group. Led by Ed (@wengzilla), the group focused on providing attendees with the opportunity to dive deep into the Mirror and Anchor protocols, in essence Terra’s stock market and banking applications. For those unable to attend, there will be another session hosted on Saturday, December 4th, from 2 - 3 PM. If you’re like me and simply can’t wait, the best course of action in the meantime would be to play around with the protocols, though if you don’t want to go through the process of getting UST, LUNAtics recommend checking out Coinbureau’s video on the protocol.

The DAO Dashboard 📜

The Sofia Cossar Interview

• Ph.D. candidate in Legal Theory and Legal Tech at the University of Paris II, researching the effects of blockchain technology on the rule of law, governance, legitimacy, and trust. 

• Member of the feminist international development firm Catalystas Consulting, based in Amsterdam.  

• Her education is rooted in law, politics, international relations, and international security from a critical theory perspective because of her Latin American imprints.

• Worked initially in the world of public international law, starting out her career at the Nuremberg Human Rights Center and Parliamentarians for Global Action (PGA) in The Hague.

• In 2016, she discovered the Social Smart Contract by Democracy Earth Foundation (DEF) and was exhilarated by the potential for blockchain to improve governance. Since then, she has been a researcher and public speaker on blockchain applications to liquid democracy, self-sovereign identities, and UBI in partnership with organizations such as DEF, Proof of Humanity, and the Internet of Humans Workshop (currently Humanetics Workshop).

D- Apart from starting small with local government, Where do you think blockchain can be most easily implemented into current operational structures?

S - So, before giving a specific answer or clear examples, we need to ask ourselves where blockchain can and should be implemented. This question is complex and context-specific, and I always like to address it in three parts: Firstly, what do we mean when we talk about blockchain technology? Secondly, in which sector, at which level, for which purpose and use will it be implemented? Thirdly, in what context will it be implemented? 

In terms of blockchain, one thing we need to consider is that technology in itself is deeply political. Not only does it operate in a political context, it also creates new power relations and it can reproduce pre-existing ones that may not be desirable. 

On top of that, “blockchain” can be used to refer to different layers in the tech stack. We can see blockchain protocols as the foundational layer of the technology, operating with peer to peer networks, using public private key cryptography with different consensus algorithms such as proof of work, proof of stake, proof of authority because a person has different hashing functions. Not all blockchain protocols are designed in a way that will ultimately propagate more decentralization. I always like to refer to Andreas Antonopoulos here and how he describes “true blockchains” as open neutral, borderless, and public censorship-resistant. That is not always the case. 

We also have blockchain applications that can use one or several blockchain protocols. These dApps enforce their own governance rules, have different levels of accessibility and different approaches to data privacy. The net result of these applications is not necessarily the promotion of decentralization and inclusion. So, before advising how blockchain should or can be implemented, we need to start by asking ourselves what the rules are operating in the blockchain protocol or application in each case.  

Regarding the sector of implementation, I believe that the most challenging one is the public sector. It usually lacks the financial, technical, and human resources to do this. Further, the social and political cost of implementing blockchain technology is higher because you are basically proposing ways to remove the middleman. So, you would need to convince the middleman to release power. The local level is usually an excellent place to start since the scale is smaller, and you have more room for trial and error. 

Also, we can implement blockchain technology for three different purposes: to make governance more efficient and secure, more transparent, collaborative, and participatory, or more decentralized and inclusive. Within each of them, there are specific use-cases. 

So, if you want to make governance more efficient, a good place to start is digitizing reports of governmental agencies to facilitate their immutability and exchange. A lot of them, like details of public works or public salaries, are not digitized yet, let alone in an immutable manner. So if you would implement blockchain technology to save this information and exchange it among government agencies, that will already be a huge improvement. 

Now, if you want to promote open government/open state principles like transparency, participation, and collaboration, blockchain can be used for civil registration, and real estate or land registration. In the Global South we have a lot of issues with indigenous rights and access to lands. So, making sure that we render these property rights immutable and more transparent. We can also use blockchain to automate the publication of public data in an open and reusable format. Another interesting example is to automate the execution of procurement processes or public budget allocation. Blockchain-based elections continue to be polemical, but you could use the technology in non-binding instances like referendums or inter-party elections. 

If what you are after is promoting decentralization of power and inclusion, that’s where you find the most hyped use-cases. You can use blockchain for decision-making through quadratic voting. Quadratic voting is an alternative to the one person-one vote principle. It’s a mathematical solution for people to express the intensity of their preference. Another case is decentralized dispute resolution, under the paradigm of like peer to peer justice. Many people are discussing using blockchain to distribute universal basic income benefits or foreign aid in a more transparent way. We can also use blockchain technology to challenge the way we adopt laws and policies through liquid democracy schemes. Liquid democracy is kind of this hybrid between representative democracy and direct democracy, meaning like, the people, the members, the user/citizen can vote on issues instead of on candidates, In that specific instance, you can vote directly or you can delegate your vote to someone else. And you can also take the vote back from that person if they didn’t vote in the way they said they would do. 

But then what people usually forget us is in which context you want to implement blockchain, and this is an important question. When I say context, at a bare minimum, you need to consider the level of internet penetration and digital literacy. You also need to account for the power structures in place. You have heard a lot about, you know, the principle of “do no harm” in international humanitarian law. The same applies to tech implementation and governance. So when you’re going to intervene in a specific situation, at a bare minimum, you need to try not to make the situation worse. 

Say your purpose is to promote governance that is decentralized and inclusive. Well, you need to understand the context. So depending on how the society is, the cultural norms, and the political groups in place, perhaps pushing to implement self-sovereign identities will isolate even more already vulnerable groups because of the lack of internet penetration in certain parts of society. You never know.

D - Where do you feel we are not looking to implement blockchain but should be?

S - I guess that is what I am trying to understand in my doctoral program, which is part of the Blockchain Gov. The project aims to produce, at the end of three or four years, clear recommendations for better distributed governance systems for blockchain communities and recommendations on how we can use or should use blockchain technology, if at all, to draft and implement into the law. 

To determine if it is desirable to draft the law with Blockchain technology, you need to analyze if it can be functionally equivalent to the way the law is drafted, as it is now. That will be my part. We’re not activists of blockchain technology; there is a scientific approach to it. So you go about with certain skepticism, which I think is good and necessary. We’re missing that sort of skepticism in this space.

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