Token engineering
Shruti Appiah Ethereum Waterloo ConsenSys
hey it’s Shruti
Education
Systems Design Engineering, UW 2018
Research
Complex systems <> Token mechanisms
Computational social science
Work
ConsenSys Labs etc.
Founded Ethereum Waterloo
Founded Prava
A crypto-economy is a complex system.
(-5,-5)
(-1,1)
(1,-1)
f(0,0)
Past does not predict the future
Dynamic, strategic behaviour
Connections matter more than the components
A crypto-economy is a complex system.
Non-linear & chaotic
Bottom up
Scale-free network
Why?
Analysis only gives 1 Nash equilibrium per month
Iterative crypto-economic design
Focus on building your system.
01
02
03
Can we anticipate all failures?
Collapse of Tacoma Narrows Bridge
How do I design a coordination system without enforcement?
The GOOD
:) Mechanism design!
:) Given: All my players/agents are rational and self-interested.
:) Objective: What’s the desired outcome?
:) Problem: How do I design a game that achieves said goal?
The BAD
:( Slow & hard
:( Fraught with assumptions
:( Life doesn’t have all the answers!
It’s an optimization problem.
Formulate your problem
? Domain
? Objective function
? Constraints
What algorithms suit?
Many metaheuristics exist...
Evolutionary algorithms
Genetic algorithm
Optimization
Good for pathfinding on graphs
Simulates social behavior - swarm intelligence also studied for AI
Be mindful of . . .
Overfitting
Solution: add more constraints
NP hard problems
Solution: Reformulate problem
If nothing works,
make your own token optimization algorithm.
Design Patterns
Curation
TCRs for list of good actors
Curation markets for determining popularity of an asset
Identity
Low level public keys
Personal identity & device identity
Governance
Aragon, EIPs, Colony
Proof of <???>
Data (human work) or computation (machine work)
.
Verification
General verification
Does your system work?
Blockchain-specific verification
Does your system work with Ethereum’s current state?
Scalability solutions are here to help!
.
Validation
Does your system achieve what it’s supposed to?
Model your crypto-economy!
.
Agent-based models
Graph Theory
Systems modelling
Good luck.
Stay responsible.
Appendix
Blockcanvas
Identify the applicability of Blockchain technologies for your use cases.
Input the data from your own case and see how it fits.