A16Z's Ambition: The Future of Trust

Editor's Note: This article is from:DeBankView (ID: DeBankView)Editor's Note: This article is from:

DeBankView (ID: DeBankView)

, Author: Ali Yahya, reprinted with authorization by Odaily.

foreword

"A Brief History of Humanity" deeply analyzes the development process of human beings until today. The book believes that the reason why Homo sapiens can dominate the earth is because Homo sapiens has the ability to create and believe in certain fictional things. Based on this, Homo sapiens ushered in the The cognitive revolution has achieved large-scale collaboration and ultimately won race competition. It can be said that trust has played a very important role in human history. At the A16Z summit, their partner Ali Yahya gave a speech on how the encrypted network will open a new era of trust and human cooperation. The translator made some arrangements and corpus supplements here, and removed some redundant parts . Interested students can go directly to Youtube to watch the lecture video and PPT.

building blocks of trust

The rise of human civilization is a story of ever-expanding cooperation. Most of the problems encountered by human beings can be solved through cooperation. Some of humanity's greatest achievements, such as the Internet and space travel, have been accomplished through global cooperation. So how exactly does a collaboration of this magnitude come about? Ali believes it's all driven by trust. Trust is actually an elusive concept. To put it bluntly, it is a kind of confidence that doing something or cooperating with someone or an institution is good for you.

Throughout history, the way we build trust has changed dramatically. When we were still in the nomadic stage, we established trust with others through various communication methods including facial expressions, body language, and text. This trust is based on social behavior between people. But because this kind of trust needs to rely on time and contact with people to build, its cost is high and it is difficult to scale.

Over the next few millennia, churches, schools, and local governments emerged in that order. By injecting the social trust between people into an organization, they gradually formed a group of trusted institutions, which helped the society greatly reduce the cost of trust, and expanded the social trust that originally only existed between acquaintances to strangers . This kind of social trust formed by the injection of social trust between people was the most mainstream way of generating trust until the end of the 15th century.

And until the 16th century, no one was able to complete the feat of sailing around the earth, so this social trust generation mechanism still has its limitations. It was not until 1522 that Magellan's fleet returned to Spain after a 72,000-kilometer journey to complete the circumnavigation feat. The important basis for this feat to be achieved is that human cognition and understanding of science have been continuously improved in those years, and science has gradually become the most important source of trust for human beings in addition to social trust. Human beings began to admit their ignorance, centered on observation and mathematics, and continuously learned new technological capabilities. In the past 500 years, science has continuously improved human abilities in all aspects, and it has also continuously improved human belief in science.

So today, trust has two important components. One is the social trust that gradually evolved from the social behavior based on biological instinct mentioned above. Including our personal social status, the various brands we trust, etc. The second is based on our knowledge and understanding of science. For example, because we believe in science, we dare to try to travel around the world and even land on the moon. This is not something that can be achieved based on social credit alone.

And these two trust components can be combined to form a complete incentive structure. For example, for counterfeiting banknotes, 99.99% of people in the world may not try it because of the technical difficulty of counterfeiting banknotes, which is our sense of trust in banknotes based on science. But this is not enough, for the remaining 1 in 10,000 smart people this is not a problem, so national legislation is needed to ensure that people who counterfeit banknotes will be severely punished by society, which may stop these smart people again 99.99% of them, this part is our trust in the country and the trust in banknotes. The combination of the two trust elements of science and national law forms a complete incentive structure, which encourages most people not to counterfeit banknotes and ensures the credibility of banknotes. Therefore, the U.S. dollar issued by the United States, which has the strongest technical background and national strength, has become the world currency.

The History of the Internet

Let's look at the development of the Internet again. In the early days of the Internet, what we call the protocols of the Web 1.0 era, such as TCP, IP, and HTTP, were all designed in an open and inclusive spirit. These open protocols mean that anyone can build any application on the Internet without permission. At present, the most mainstream software systems Android, iOS, and almost all Internet applications are built based on these open source protocols.

It is hard to imagine that so many countries and companies in the world can miraculously build the entire Internet around a unified protocol. In fact, all this is the power of trust. Because the core protocols of the Internet are all open source technologies, no one can unilaterally control them. So such neutral technologies constitute an open environment, making entrepreneurs and investors believe that they can compete fairly in this network.

This brought about a golden age of Internet application innovation. But because open source is hard to make money, the business models of these startups depend on building closed applications on the open Internet. It also ushered in the explosion of applications in the Web 2.0 era, such as the familiar BAT in China and GAFA abroad. Of course, thanks to these companies, billions of people have access to great new technologies. But these tech giants have become our gatekeepers in the internet world.

And because of the huge advantages generated by network effects, users, content producers, and third-party developers are forced to trust these Internet giants. In the end, we went from a model of trust in Internet technology to a model of trust in these Internet giants. In other words, the trust in "Can't be evil" of Internet technology has changed to the trust in "Don't be evil" of companies such as Google. However, who would still believe that we can build a company that surpasses these giants under the siege of these giants? And the end of that trust is devastating to innovation across the industry.

How Encrypted Networks Build Trust

If the Internet is to continue to develop, it needs to solve the trust problem mentioned above. We rely on the current technology giants to guarantee the security of user data for us, but since the current trust mechanism cannot meet the future development of the Internet, it means that we need to construct a neutral database to store the data that currently belongs to users. The data is returned to them, and no institution has the ability to control and modify it. Then this means that it is necessary to ensure that the database is self-supervised as much as possible mathematically, and cannot rely on the trust endorsement of intermediaries.

In 2009, Satoshi Nakamoto published the Bitcoin white paper. The core idea behind Bitcoin is to use game principles such as digital signatures and proof-of-work to construct a complete incentive structure to establish a collectively owned and neutral Bitcoin transaction database. Its security is generated from the user, and its user can be anyone, from anywhere, and does not need anyone's permission. In other words, the database is actually decentralized.

Since anyone can participate without permission, it means that there may be some dishonest people involved, who may be against the entire system for personal gain. But the genius of Bitcoin is that its incentive structure has the ability to self-monitor, which can ensure that the losses of the participants in lying will exceed the gains he gains from lying. This incentive structure, known as proof-of-work, encourages participants in the network to constrain each other and ultimately keeps the database and network secure.

Then in 2014, Ethereum was born. Its database not only has transaction data of tokens, but also can run any computer program in the network. It means that Ethereum has become a decentralized, collectively owned, world computer. Programs running on this network, once deployed, become collectively owned by the network, and no one can modify its code. Also, these programs are open source, so anyone can see what they're doing. Therefore, these programs become a bridge to build trust between strangers, and this trust is completely based on science and does not rely on the credit endorsement of any individual or institution. Ultimately, we have a programmable trust that can be programmed by anyone to transmit trust through various gestures.