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Meltem Demirors on the Importance of Staking & Governance
May 14th, 2019
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About this Episode
Today's episode features an interview between Meltem Demirors - cryptocurrency investor, advisor, advocate, and Chief Strategy Officer of the digital asset management firm, CoinShares - and Patrick Stanley, Head of Growth at Blockstack PBC.

The two discuss all things staking and governance. They talk about various protocols implementing staking, relate contemporary crypto networks back to classical Greek philosophy, explore the future (or lack of one) of VC in light of recent crypto developments, and more.
    Show Notes
    • 1:01 An overview of staking.
    • 2:18 Ethereum's launch introduced hypothetical thing called proof of stake.
    • 4:04 What are the benefits for stakers?
    • 4:25 Staking does not earn a yield, but rather inflation.
    • 5:32 Some networks are introducing negative rewards to incentivize participation.
    • 8:38 Ancient Greek philosopher, Polybius, wrote a book called The Social Political Cycle on governance 3,000 years ago.
    • 10:13 Are stakers making governance decisions in Tezos?
    • 10:29 Tezos' governance system is the same as the function that secures the network.
    • 10:49 Decred is structuring itself difference, separating those two functions into separate entities.
    • 11:34 "History doesn't repeat, but it certainly rhymes."
    • 11:54 Third point on Polybius.
    • 13:48 Thoughts on UX and some of the pitfalls when custody is required to do staking.
    • 16:19 How proxy voting can lead to voting cartels, as has emerged on EOS.
    • 17:30 Meltem unpacks her quote about how 'protocols don't exist in a vacuum when it comes to collusion, bribery, alliances, etc.'.
    • 19:15 "Economically speaking, a cartel is not necessarily negative."
    • 21:15 "In the EOS network, BlockOne owns 10% of the tokens and actively participate in voting for block producers."
    • 22:01 How staking can be used in support of applications.
    • 23:09 A challenge with applications right now is there's a competition among protocols for use cases.
    • 24:56 Meltem's view on how VC gets involved in staking and what the evolution of that might look like.
    • 26:37 "Financial engineering has created all of the wealth we see in America... and crypto networks are rife for financial engineering."
    • 29:13 "One of the things we don't think about enough are incentives."
    • 30:30 Are there any projects showing early signs of avoiding 'tragedy of the commons'?
    • 32:00 "I do have a concern about a lot of projects."
    • 33:34 Who outside crypto land might help accelerate the experimentation with staking and governance?
    • 34:50 Where should people go to learn more about staking and governance?
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