3d dimenstional shapes in space

ETC Cooperative – Interview with Bob Summerwill

Posted October 25, 2019

Interview with Bob Summerwill, Executive Director, ETC Cooperative

Colin Platt, here, and I managed to line-up an amazing conversation with an amazing individual, Bob Summerwill, the Executive Director of the ETC Cooperative. The ETC Cooperative is a non-profit dedicated to supporting the Ethereum Classic (ETC) protocol. Bob also serves as the CTO of Varro Technologies, and as Community Ambassador for CryptoChicks. Bob has a history of being at the centre of things in this space, at the right time, having been involved in the Ethereum Foundation in 2016, moving over to ConsenSys to launch the Ethereum Enterprise Alliance in 2016. He’s also held technical and developer roles at EA, Sony and Sweetbridge. In short, Bob is a great person to speak to if you want to know where we’re going.

CP: Hi Bob, great to catch up again, it’s been a busy year for you. Thanks for taking the time to speak with me, and for sharing your insight. Could you share a bit about who you are and what you do?

BS: For sure! So the majority of my career was as a software engineer in the videogames industry, with over 15 years at Electronic Arts, mainly working on EA Sports titles, with roles on game teams, in central technology and on collaboration projects across the company, “peaking” when I was appointed the first Architect for EA Sports as a whole.

I went down the blockchain rabbit hole in 2014, including meeting Vitalik for the first time, and from 2015 onwards I plunged full-time into the Ethereum ecosystem and have never come up for air since!

CP: Let’s start with a big topic that you and I have discussed. Communities and cooperation across projects in this space. Why is this important?

BS: When the Ethereum Foundation was being rebooted, following the departure of the previous Executive Director, I contacted Vitalik and offered to help with the transition. I had been a part of the Foundation before my time at ConsenSys and worked with the C++ team. Vitalik suggested to me that I try to identify what “good would look like” for the Foundation. As I dug into the possibilities of what the Foundation could do, I also started to stumble across some of what led to the previous bumps in the Foundation. At the outset, before the Foundation launched, there were two camps, one seeing a path for what would become the non-profit Ethereum Foundation, and another that saw a for-profit company sitting in the middle of Ethereum as the best approach. Unfortunately, these two ideals led to a significant level of distrust amongst the two camps, with those championing the idea of a for-profit being demonised by those who supported the non-profit approach. This led to the former seeing the latter somewhat as an “attack on Ethereum”. As sometimes happens, this led to something akin to people supporting a sports team, where logic became less important than backing your side.

CP: The relationship between the Ethereum (ETH) and the Ethereum Classic (ETC) communities have been tense historically. Why do you think that these relations were complicated?

BS: My view has always been that Ethereum is a technology stack, and that’s what originally attracted me. Currently we use the Ethereum technology in the mainnet (ETH) as well as several testnets. There are also people working on Enterprise Ethereum projects. Do people necessarily see those as an attack on Ethereum? Most would say “no”. Coming back to our history, in 2016 when the DAO hard fork occurred, some members of the community decided to keep the original, non-forked, chain alive and it became known as Ethereum Classic, or ETC. Unfortunately, as some of the supporters of ETC had already been blacklisted by the community that followed the hard-fork [ETH], it was seen by some as an “attack” on the fundamentals of the [ETH] project.

CP: You talk a lot about the importance of the human ingredients to the Ethereum story. What do you think that this can explain as to how it has developed?

BS: I think to get started, it’s worth noting that while we have some differences of opinions, crypto is still an extremely small niche, and isn’t load bearing for society, if crypto got wiped off the face of the earth tomorrow it’s not like the world would even notice. My second point is that most people in crypto objectively probably all agree on most things, even if we have differing opinions on some topics, and very importantly there aren’t bad people in crypto, just a bunch of flawed human beings trying to build a dream. We’re all altruists, dreamers and technologists.

Let’s put some colour to this, at the end of the day, cryptocurrency is an incentive mechanism for a world without trust. It naturally follows that the people originally attracted to this, and actively building this, are people with trust issues themselves. Many of them fear control by the elites, and experiment with the tools that they have to attempt to break from this relationship. Sometimes this also led to “cargo-culting”. Coming back to my earlier note, this also has the side effect that “non-believers” in this vision can be seen as an attack on the early adopters.

Amongst those experimenting with this, many ended up with the “decentralisation disease” trying to remove all semblances of hierarchy and control. We had lots of people making mistakes on basic things, because they had a “phobia of professionalism”, and those coming in with basic tools for things like project management and product delivery were seen as trying to take over. Unfortunately, we’ve also seen a lot of “cultural tourism” with people who aren’t really interested in the underlying technology showing up with an opinion.

CP: Aside from the obvious catalyst of the hard fork, what are your senses of what’s similar and what’s different between these communities and the aims of the ETH and ETC projects?

BS: One of the things that is important to me is learning from the lessons of what works generically and not trying to always rebuild from scratch. Certainly, there are new things that we don’t have a tried-and-true path for, but many things already have the tools and we shouldn’t reject them out-of-hand.

With ETC our approach ultimately started from a philosophical issue with the DAO hard fork, but the underlying message is deeper and more important. If you have a technocracy, that may be worse than the current system because those in control were never elected and have no accountability. ETH currently views that the DAO hard fork was ok, and there is a social consensus around future hard forks, but you also have a mob democracy, without a voting system, and no constitution. While I wouldn’t say that outside of the powerful early adopters the rest are serfs, but it still isn’t great.

There have also been those reciting an anti-ETC “purity pledge”, reading Vitalik’s comment following the hard fork, that –even if ETC outpaced ETH– he would concentrate 100% of his effort on ETH. I don’t think that was a negative comment on ETC per se, but a reflection of where he spent his time. It’s a nuance, but it’s important nonetheless.

The view in ETC is that there are some basic hardlines that we don’t cross, and that the base layer should be fixed with minimal changes. While it could be debated whether to allow the DAO HF or not because many viewed it as theft of funds that would have gone to developing the ecosystem, interventionism was a dangerous and slippery slope. In ETC this type of thing was strongly rejected. This also extended to issuance, ETC opted for a fixed upper limit of tokens to be created over time, like Bitcoin, because people were upset with the continuous changes they saw in ETH. The hope is that this will give people looking to build on ETC the certainty that things will remain stable for decades.

Some people have called this sociopathic, I don’t think that is fair, there is a strong social layer, and people respect the adherence to principles.

CP: You took the ED role at ETC Cooperative earlier this year, can you tell me about a few things that you are most proud of so far?

BS: There have been some big technology priorities that ETC has been taking on, and we’ve done a lot as a community to catch-up with the technology in the ETH stack. At the same time these changes are done in a way that minimises the impact on the protocol and reduces backward compatibility issues. Some examples of this have been rejecting gas price changes that were accepted by ETH, rejecting ProgPOW –which I believe has corporate profit motives and lacks strong technical justifications. We hope to catch up with the latest EIP (Ethereum Improvement Protocols) by mid-2020, and even implement some features, like EVM versioning before Ethereum, which we believe will prove extremely important.

After that we expect ETC to be objectively better as a technology stack than ETH, and with that show the Ethereum Foundation what good looks like. Unfortunately, due to the Ethereum Foundation shifting their focus to ETH 2.0, they haven’t properly focused on, or funded ETH 1.0 development, which gives us an opportunity to show people that a lot of the promises are still possible. Of course, this will also force projects to move up to layer-2 solutions, which we believe is positive. In addition, ETC benefits from not having the ICO bloat that beset ETH, which even if things pick up on layer-1 won’t necessarily suffer with a greater number of transactions.

In addition, as a community, I am proud that we have teams that are properly funding ideas and projects. It really feels like 2015 in Ethereum, but with better technology.

CP: Looking forward, we’re having a conversation this time next year. What are the milestones that you look at to say that we’ve have a good last 12 months?

BS: As our technology matures at a faster rate than ETH 1.x, and we properly fund development and projects and learn from the lessons of Ethereum and from other parts of industry, I look forward to new projects deciding that ETC is the right place to build.

CP: Bob, thank you very much for coming to speak with me and sharing your wealth of knowledge, I feel like there is a lot more that we need to talk about and hope that you’ll come back again soon.

BS: Thank you, this has been great, and I’d be happy to come back anytime.

As always, worth mentioning that nothing in this should be construed as an endorsement, or enticement to invest in any of the instruments or projects mentioned. We are big fans of crypto but cannot be relied on for financial advice. Please make sure to do your own research and consult a professional before making any investment decisions.

3d dimenstional shapes in space

Crypto Ratings Council

Prepared by Nick Stackhouse
Posted October 10, 2019

Colin Platt here again, time for another blog, exploring some of the topics that Zeth, Shaun and I found interesting.

On the 30 September, several of the largest and most prominent US-based companies in the cryptocurrency space, including Coinbase, Kraken, Circle and Genesis, came together to announce the launch of their latest initiative, the Crypto Ratings Council.

The members of the Crypto Ratings Council believe that they found an opportunity to offer further clarity to companies working with digital assets, with regard to their treatment under US laws. To this end they developed the Asset Rating Framework (the “Framework”) which specifically focused on the likelihood that a US Federal court may find specific digital assets to be classed as securities under the benchmark “Howey Test”.

This test comes from a landmark 1946 court case, whereby it was decided that an instrument could fall under rules that would require that they, amongst other things, need to register as a security. This test is comprised of four factors: “(i) whether crypto purchasers invested money, (ii) in a “common enterprise”, (iii) with a reasonable expectation of profit, (iv) based on the efforts of others.”

Looking at the four components of the Howey Test, the Framework is used to assign a ranking of 1 (least likely to be a security) to 5 (most likely to be a security). The Crypto Ratings Council does not rate all tokens and does not release the names of tokens which it determined to have a 5 ranking.

The Block investigated the initially released ratings, which showed that Maker, Polymath and XRP were all rated as more likely to be considered securities:

Bitcoin, stablecoin DAI, Litecoin and Monero, however were seen as the least likely to satisfy the Howey Test.

It is worth noting that on the day that the ratings were released, the US Securities and Exchange Commission (which governs securities registration in the US) announced a settlement with EOS issuer Block.one, which alleged that the EOS ICO had been an unregistered securities sale. The Crypto Ratings Council had rated EOS a 3.75, on par with Augur, Decentraland, FOAM, Hedera Hashgraph, Loom Network, Stellar and Tezos, and less than Maker, Polymath and XRP.

Ether, the native token of Ethereum, was rated a 2, suggesting that it was more likely to be considered a security than Bitcoin, but still relatively low. Details for this were not made public, but some have speculated that ETH 2.0 and a move to PoS may have prompted an increased score.

Legal experts have commented that the release of these ratings, while a positive sign that such companies are conducting due diligence, could have negative repercussions, including attracting unwanted attention. It’s hard to say if, or how a court might use the Crypto Ratings Council Framework if one of the rated projects was challenged.

Given the SEC action it is unclear whether the Crypto Ratings Council will amend their Framework.

What we can draw from this, is an appetite from many involved in the cryptocurrency space to have clear cut guidance on challenges facing them, including regulatory treatment. This is perhaps not a surprise, given their desires to build new things which may not always neatly fall into an existing bucket. However, for that same reason, it may also be difficult to offer such guidance in a useful manner.

As always, nothing here should be construed as financial advice, recommendation or endorsement of any project or cryptocurrency.