Episode 322

Edgeware – Coordinating Distributed Communities With On-Chain Governance

Governance within any community has been a work in progress for humanity’s history. The blockchain ecosystem continues to develop and offer an alternative to today’s centralized powers. With this, distributed projects and technologies will need to enact clear governance to ensure viable competition with the streamlined decision-making processes present in today’s institutions.

The absence of codified governance in Bitcoin may be one of its most significant traits, signaling to the world its predictability due to its inability to change drastically. New projects like Edgeware, however, hope to encode the rules of governance on-chain and ensure a transparent process for stakeholders wishing to participate.

Edgeware is a smart contract platform built on Polkadot’s Substrate. Focused on developing community-owned governance tools, Edgeware is a distributed project where participants use the tools themselves to vote, delegate, and fund each other to upgrade the network. While initially developed by Commonwealth Labs, Edgeware at launch will be entirely managed by the community, which holds 90% of the tokens and resulting influence.

Topics discussed in the episode

  • What attracted Dillon to crypto and why he co-founded Commonwealth Labs
  • Multi-chain governance
  • How Edgeware is unique
  • Building Edgeware on Polkadot’s Substrate
  • Retrospection from the soft-launch of Edgeware
  • What a “lockdrop” is, and why Edgeware had one
  • The issues and controversy around the Edgeware launch and lockdrop
  • The zero-day fork of Edgeware, Straightedge
  • The future of Edgeware

(6:44) How Dillon found crypto

(8:58) Vision of Commonwealth

(9:44) The team and their projects

(11:11) Multi-chain governance interface

(13:04) How commonwealth is different from community forums already in use

(14:52) Edgeware as a test-net for active governance

(16:53) How edgeware governance compares

(18:55) How Edgeware stands apart

(20:15) Identity linking

(24:25) Connecting with Polkadot and choosing to build on Substrate.

(25:51) How Edgeware utilizes Substrate

(27:20) Smart contracts on Edgeware

(29:54) Difficulties with the launch

(35:05) Difference in allocation running the lockdrop scripts, vs what the website said

(37:15) How to ensure concerns communicated are acted upon

(39:54) Making the newly launched network a test-net

(42:09) What is a lockdrop?

(45:01) Difficulties with the initial lockdrop and Straightedge

(51:11) On Parity’s influence in the network

(52:37) The future of lockdrops

(55:01) The future of Edgeware



Sebastien: We’re here with Dillon Chen, who’s the co-founder of Commonwealth Labs. Dillon, thanks for joining us today.

Dillon: Thanks for having me on. It’s been a long time coming.

Sebastien: Yeah, it certainly has. I think we started this conversation, six months ago or something like that?

Dillon: I think so. right around when the lockdrop first started to actually kick off. It’s been a wild ride, since.

Sebastien: Yeah, and a lot has happened since then. It has been a wild ride indeed. Before we get into the heart of the matter, which is Edgeware and everything related to it, let’s get a bit of background. How did you first get involved in crypto

Dillon: I was born and raised in Cincinnati, Ohio. and so didn’t have too much exposure to tech stuff. I wasn’t born in Silicon Valley, or anything. I read the wired article on Silk Road, and was just really interested in how Bitcoin, or this type of technology, was something that anyone could tap into, for different use cases. Then I got an internship in the valley, ended up getting paid in Bitcoin, or requested to be paid in Bitcoin. I wasn’t a big gamer, in high school, and so really couldn’t mine. That was the rabbit hole moment for me. Through college, I did some network research, looking at different addresses and things like that through a lab at Penn. I started a company with my co-founder, Drew. We built a company called Source that was Airbnb for WiFi, for sharing bandwidth, wanting to use an erc20 token. Then, also helped invest at Rough Draft, into crypto companies, during 2017. I’ve been all around, that’s the story for me.

Sebastien: And what is it about crypto that you found attractive and what made you want to dedicate more time and build a company and a product.

Dillon: I was attracted basically to the coordination and allowing different actors who might not know each other, to act in trust minimized settings. And so I think the use cases that were really interesting to me were less on the financial side, but like creating some type of research coin to help, basically produce more public goods. That angle, for me, and I think that naturally led into the work we do at Commonwealth. creating a new system, like Edgeware, or creating an interface or tools that help other people coordinate around things.

Sunny: Yeah, cool. Then you, with Drew, you guys co founded the Commonwealth company together. What is the vision of Commonwealth company?

Dillon: Commonwealth, the tagline we’re using now is, “use Commonwealth to organize your community” and that encompasses governance. What is community organizing? It’s distributing a token, or just aligning all your stakeholders, actually getting people to discuss issues or topics and then funding different things. Covering that whole gamut and building out a product and protocol suite that actually helps with any protocol to help them make their community work better. Hopefully, we can extend outside of crypto, or as crypto eats the world, everything will be organized through Commonwealth.

Sunny: What does the team look like today? I know you and Drew are still working together, but since then, the team has expanded. How many people are there working on these projects, and what are the different projects that are being built right now?

Dillon: The two questions. What’s the team look like now? then I can get to the second part of what projects that we’re working on. For the first answer. We have another co-founder Raymond Zhong, he was formerly at Princeton, also at AngelList and a few other places, and got his crypto exposure through those venues. We’ve been longtime friends, and came together with multiple perspectives. Drew’s had an academic research background, he recently left his PhD at HebrewU to be at Commonwealth full-time. That’s the founding team. We’re a team of eight now. Mostly engineering heavy with a bit of product sprinkled in. based here in New York to a certain extent, but we’re also distributed and hiring. If you are an engineer and listening to this, please reach out to me. I don’t know if that’s a shameless plug.

In terms of the projects we’re working on, I think the bulk of our work now is still focused on Edgeware. I know we’ll talk about what that is, but the one sentence for Edgeware it’s a Polkadot smart contract platform. We think the first use cases basically will be spinning up different DAOs and funding those DAOs with the Edgeware treasury.

Dillon: Beyond that, we have a multi-chain governance interface, Commonwealth. We basically hooked into NEAR protocol, Cosmos, Polkadot, Kusama, Edgeware, Straightedge, soon to be. We’ll continue to expand outwards from there. Those are the two main initiatives right now. It’s been an interesting, wild ride. As for Commonwealth, we’ll work with any protocol out there that has governance needs, and work with them through that.

Sebastien: What exactly is a multi chain governance interface and what work do you do specifically with chains to help them on governance?

Dillon: Great question. Governance is a really large topic. There’s the gamut, from just talking about what the governance structure should be. I know Sunny, you were talking about who the token holders should be for a collateralized stable coin. That would be one thing that we might talk with protocols on.

In terms of products and the things that we actually build on the day to day basis, it’s basically a discourse like forum where you can talk with threaded conversation. We call it governance covered. Any on-chain governance action that they might have. Whether it’s signaling polls, treasury and fund distribution, allocating certain permissions to council members or things like that. We’ll help build an interface that covers that whole thing, and then also allow you to talk about the specific issues, and then put that all into the Commonwealth.

What Commonwealth looks like, it looks there’s a bunch of subreddits and they all have different activities that you can do. You can talk about things you can discuss your issues, and you can fund different projects.

Sebastien: So for instance, the Cosmos community has a bunch of different forums that they leverage to talk about governance proposals and things that will eventually make it into governance. How does that differ from what the individual projects and communities are already maintaining?

Dillon: Yeah, there’s a lot of projects out there that still don’t have a forum. We’ve seen a lot of projects use telegram, discord, and haven’t really spun up a place where real work, or proposals can get done. The other thing I would say is we basically want to make sure that everything is decentralized.

The future for us is making sure that we’re still an interface and we can run a centralized appending service, but the conversation should still be viewable in any type of interface. For example, for if we’re talking about the cosmos forum. Ideally, it’s not run on discourse, it’s run on this decentralized back-end, and Commonwealth is one place where you can come and see it, you can still see the same stuff in the existing forum. And that’s the future we’re building towards, I think we’re still a few months away from productizing. the full decentralization front, we’re still working on a lot of things that are directly related to the user experience.

On user experience, another thing we found. it’s still tough, I guess, within a community to know what everyone is thinking, especially as these communities get larger. And so having the ability to run signaling polls on a token holder basis is something that we’ve heard time and time again. And so that stuff is built right into the forum itself. Yeah. continuing to make sure that in addition to any forum that’s out there, we can continue to build on top of that.

Sebastien: You announced Edgeware the web three summit in 2018. I remember seeing that talk, it was right before lunch, it was this short little talk before everyone went out. I had a few takeaways from that talk… One, you said that Edgeware was a test net for active governance? Can you describe what you meant by that?

Dillon: I think we’ve maintained that vision throughout 2018-2019. And hopefully, for the whole lifetime of Edgeware. I think, in the space, it still feels we haven’t found the exact right governance mechanism for creating a protocol and making sure that it runs well. It’s a few nested governance experiments that we’re running. Edgeware itself has a pretty robust governance mechanism. I’m sure Sunny will have things to say about that. We have a council there’s a treasury, and you can disperse funds from that Treasury, through on-chain votes, same in the same manner as Cosmos.

There’s democracy so anyone can submit a proposal and have it be voted on. On top of that, it’s, again, a smart contract platform and the thing that we hope as the guiding light for projects to help build on Edgeware would be that, a DAO should be able to experiment, or use some of the features, that we’ve already built for the chain, to run their own type of governance experiments. Beyond the core governance experiments, we’d like to see DAOs that run with quadratic voting implementation or do things on a one person, one vote type of basis using the Edgeware identity module that we’ve built, where people can link a twitter address, a GitHub handle, and then use that as the basis for running these DAOs. That’s what we mean by running these active governance experiments in a decentralized manner.

Sunny: Could you talk a bit about some details of what’s special in the Edgeware governance process How does it compare to the one in Tezos, for example, or in Polkadot, or in Cosmos?

Dillon: We inherit a lot from building on Substrate. we’re built on Substrate, the Parity \ Polkadot ecosystem standard for building blockchains. There’s a bunch of modules. For any listeners that do blockchain development, you can basically swap in and out these different modules. The modules we’ve chosen are, are closely related to Polkadot governance, and that is continuously being iterated on. And there’s a wealth of information out there that I can also point listeners to afterwards. For Edgeware, specifically, we have a treasury and so those are token weighted votes that allocate funds from that there’s a council with elected council members, each council member is elected on a rolling basis. Right now the parameter that is set in the Genesis spec is 13 councilmembers, with seven in waiting. Those are voted in on a token holder basis. One token one vote. But other things that are hidden in there are the notion of time lock \ stakeholder voting, so the longer you lock for, even if you’re a smaller token holder, you can amplify your voice. it’s not just on a stake basis.

Another feature, again, inherited by using polka dot governance, is the ability to have a cool-off period. In the same way that someone can rage quit Moloch DAO, there’s a waiting period for a proposal to actually having binding change through on-chain governance. And so people can think through, we voted this in, does this really make sense? I could go on and on. There are other experiments we’d like to continue running, but that’s the base layer of what the network is launching with.

Sunny: And so what functionality does Edgeware provide that make It more enticing as a place to do governance experimentation. let’s say I wanted to build a new DAO, what features are on Edgeware that I couldn’t find on Ethereum, for example.

Dillon: I’m personally most interested in and the thing that we’ve heard a lot of great feedback on is the treasury itself and to the identity module, so just directly linking twitter address or XYZ, Web 2 identity, to address allows you to experiment, hopefully easily with different identity standards and voting schemes. But for the first part, we’ve heard, a lot of teams basically want to run. Here’s an example. A team out west right now wants to build Donor Advised funds. those are legally linked, or a donor advised fund is I donate to this fund itself, I get the tax write off, but I can still advise where I want those funds to be allocated, that they have to be allocated to a 501c3. one thing That we’ve talked about is basically having them pull from the Edgeware Treasury. The Edgeware Treasury I think, is probably the key feature here allowing different people to have their DAO seeded pretty easily. And we’ve seen a lot of traction related to that.

Sunny: Can you talk about how the identity linking works?

Dillon: I haven’t thought about these things, we’ve been so geared up for launch recently. Specifically with respect to identity, you can have just an arbitrary string that gets stored as an attestation. Then, it’s a few step process. I can submit, this is a Twitter type of adaptation, and then this is my handle, and then I have to post a proof. On the analog, I have to sign a message and then I post the hash of that message, and then a verifier. Right now, a single address looks at both those things and checks if it actually is valid. Hopefully the role of verifier should be decentralized, as time goes on. It could go to an m out of n type of voting scheme, or it could have some token holder cases for creating, or verifying, some of these claims. Hopefully it’s pretty modular and any type of claim can fit in this scheme.

Sebastien: Is this something that’s built into substrate? Or is this something you guys built?

Dillon: This is something that we’ve built, but I definitely should highlight that there’s really interesting work going on in the substrate repo, specifically. The team at Parity is also working on similar identity stuff. I mean, in general, the ecosystem, I think, has done a really great job and has spent a lot of time focusing on identity.

Kilt is another great team that’s also working on things. There’s a whole active bunch of developer teams focusing on identity and you know, we are one of them.

Sebastien: That’s a really cool idea. I never thought that about this particular way of doing identity verification for a blockchain. Is there any work being done on maybe automating that? I feel you could maybe use something maybe I’m wrong here. But something TLS notary to verify, let’s say, a Twitter page, which would have a side message. And so nodes could just verify a URL, crawl it, look for a sign message, know that it’s coming from Twitter, and then use that information. Is that kind of, maybe thinking further ahead, things that you think would be possible.

Sunny: similar to what chain link does, right?

Dillon: So something similar to that. Yeah. If we want to call identity schemes a subset of Oracle’s, it can be similar to that. There’s two things that I think are really interesting. We’re actually working on a zero knowledge variant of this. You can have a zero knowledge attestation, I’m included in this group, and I have more than X number of followers, and then using that to potentially create voting teams. So, only allow individuals who have larger than 10 k followers to participate in this DAO or some governance scheme.

The second thing is a super recent development, I don’t know if you all saw today on Twitter, Jack Dorsey talked about how they want to decentralize Twitter. That was really interesting, so having some type of notary service, or directly pulling from the API, or whatever type of decentralized back end, so to speak, that they build would be future things we want to continue exploring and working on.

Dillon: Even within the Eth-sphere, there’s Humanity DAO, all these experiments are closely related, so I’m still attesting to a Twitter handle or something like that. And then some set of verifiers making sure that it’s valid. I don’t think we’re the only ones doing it. But I think it’s interesting. We feel the porting of a Web 2 identity to the web 3 sphere is probably the easiest way to onboard people, instead of going to the KYC route of onboarding driver’s licenses or social security numbers and things like that. That would be my overall thoughts on identity in general.

Sebastien: So how did you get introduced to the Polkadot team? And why did you just decide to build Edgeware on substrate?

Dillon: Yeah, so I think it comes down to the right place, right time. We were lucky enough to… we incorporated the company in mid to late 2018, and were thinking through different governance experiments that we wanted to run. We always knew we wanted to build the governance interface, but felt we needed a community that we could directly help. Through talking with folks at Web3 and Parity we came up with an idea that has been floating around the ecosystem. And that was the idea of Edgeware.

There were few pieces that came together in this series of conversations. We talked about how we should, okay, if we have a blank slate to start with, for some type of smart contract platform, how should we distribute tokens? How should votes be allocated, and are there any other things that we will want to do with it? Through 2018, and then up until through summit, there were these water cooler jam sessions, that we talked about these things. And so that was how the lockdrop came to be, which I know we’ll talk about. That’s how we decided on this Treasury framework and talked about linking identities to that. I hope I gave a quick TLDR, on the history of how he came to be.

Sunny: Yeah, and so a lot of the tech in Edgeware is based off a lot important lot of the tooling from Substrate, can you give us an idea of which pieces of the edgeware stack are from substrate, and which are the novel pieces of software stack?

Dillon: We’ve done most of the experimentation around the edges. To think through substrate so there’s the networking layer, we don’t touch that. It uses libp2p and stuff like that. There’s the consensus layer, different implementations for weighting stake. We don’t touch that either. We use modules for the Treasury, slashing, all this stuff is included in substrate.

The things we’ve built are basically four modules. Its identity, there’s signaling, running a vote scheme, weighted by a token balance, with different types of polls. Binary, yes\no, and rank choice as well. One module we’ve built is allocating tokens directly to the Treasury. The biggest experiment that we ran was basically building lockdrop itself. That was like sets of ethereum contracts, and then the associated UI to help make this process run pretty smoothly. Still more around the coordination and UI stuff.

Sunny: Sure. And so with the webassembly smart contract, from my understanding, you mostly import those from substrate? What’s the current status or usability of this? It’s been a while since I’ve tried playing around with it. When I tried playing around with it about four or five months ago, it still seemed heavily a work in progress where you couldn’t really do sort of cross contract calls and such. Could you tell us the status of what the developer UX would be if I wanted to start writing smart contracts on Edgeware?

Dillon: I would say you can definitely still experiment around with these things. I don’t think it’s been a focus either at Parity or Commonwealth. The stack right now is, just the TLDR. You can write, as Sunny mentioned, WASM smart contracts. There’s one specific module for that, on top of that there’s the ability to write in a language of your choosing, anything that compiles down to WASM. Parity built a library, called Ink. You can write rust smart contracts, everything without the standard lib.

Work still needs to be done on the first layer, the smart contract module, so as Sunny mentioned, create cross-contract calls, create calls from other modules into the contract module and having them work across one specific chain. There are tutorials out there that do exist and people have been experimenting. I would definitely point folks to the riot chats that are specifically related to WASM smart contract development in the polka dot ecosystem.

Sunny: what are some of the interesting contracts or projects that have been built so far, or in process of being built?

Dillon: Post launch, we would like to build something like Moloch DAO, within this framework, pulling from the Treasury to allocate funds to this place. Again, I think the projects that are still in flight, talking to Garrett at East Node, based out in Japan, he’s also thinking about things like this. Then what I alluded to before, running these different DAFs (Donor Advised Funds) through on Edgeware would be another example of a project within I guess, the atmosphere. It’s really tough to keep track of other interesting projects that are happening in the wider polka dot sphere. I know there’s always experimentation going on. There’s too much going on for me to keep track.

Sebastien: So the Edgeware launch was an interesting one. Let’s talk a bit about what happened. For context, I think that a lot of people were excited about seeing Edgeware launch. I was certainly following it, to see what would happen, post launch. But I think it’s safe to say that things did not go as expected. Can you walk us through the time leading up to the launch? What was going on within the team and in the ecosystem?

Dillon: We’d always kept this September 15 date, and we wanted to always do something around that date, whether it was the mainnet launch or some other type of road to mainnet launch. We wanted to make sure something came out at that time. We ran several test nets throughout this spring, and summer, with specific known issues. The thought process for us, and the community, was to be able to iterate fast from that. Launch something and then change things on the fly using the built in Polkadot governance framework, and\or the pseudo key.

One issue that Sunny even brought up was the fact that there were slashing events going on. People have to submit an online heartbeat during a specific session, and if a new validator joined, they might be slash incorrectly, essentially.

We continued to work with different folks, Parity, Web 3 Foundation, all these other teams to pinpoint that. The fixed we had decided to go with, was turning off slashing and then turning it on. Once those had been fixed, and we could run a governance upgrade to make sure that those things were turned off. We released a blog post detailing these expectations. Maybe we over promised a bit on what it was. We called it a soft launch. I think, since folks within the community thought that we were doing a main net type of launch, that there was a lot of confusion and miscommunication happened there. That’s the experience from the Commonwealth side. But I’d be very curious to hear from Sunny, specifically, as running a validator, the view from outside.

Sunny: One of the solutions that was brought up was to turn off slashing. From my experience, what ended up actually happening was, one of the parameters was set to zero percent, but it actually wasn’t the slashing parameter. It was a parameter that has to do with, if I report a fault that someone else has done, let’s say someone double spend and I’m the one that reports it, that was traditionally set to 5%. I would get 5% of their slashing amount, as a reward for reporting. But that got set to zero percent.

That seems like something where it was just in the fly of the moment where there was such a mad rush towards launch. If things were taken a bit more slowly, it could have maybe worked out we could have caught these tiny things.

In retrospect, do you think that was the right approach to take of getting it out the door and having to stick to that September 15 date, especially when there were so many voices in the community who are trying to bring up a lot of these problems?

Dillon: Yeah, hindsight is always 20/20. Making sure that everyone’s bought in, is something that the community will definitely take into account going forward. Hopefully we can use the signaling tools, the informal informal channels that we have to discuss these things going forward.

I would definitely agree keeping to a deadline or making sure that things are working. It’s always really tough, especially in this distributed setting, where changes and hotfixes are pretty tough to apply, or at least take maybe a week or two to plan. I would basically definitely agree with you there. It’s interesting, because there’s multiple parameters on the node level, and then on the substrate side, and the code base is continuously evolving on the substrate side. Within the modules, there are calls or extrinsics that have to be turned on and off, physically, there. I think we didn’t change those there.

Hopefully going forward, the new testnet is up and it is running pretty smoothly, so spin up your validators, and nodes, and jump in to conversation to talk about launching the network. It’s very much ready from a technical standpoint. Now. whether it’s December or June I think what hopefully the community can come to consensus on when is an appropriate time.

Sunny: One of the other issues that I also brought up a few weeks prior to the launch was that the allocation that was the result of running the lockdrop scripts was different than the one that was shown on the Commonwealth webpage. And it turns out that that had to do something with how the multipliers are being calculated. Can you tell us a bit about that?

Dillon: Yeah, definitely. What Sunny is alluding to, when the lockdrop was run… well TLDR lockdrop, you can lock tokens for three, six or 12 months. We had this process going on for three months. If you locked for a short amount of time, three months or a longer amount of time, you got a corresponding bonus. In addition to that, there’s this notion of an early participation bonus. the earlier you participated during this open enrollment period, a person would get more tokens. The schedule we put out was basically 50% and then falling pretty smoothly down to zero percent, essentially at the final date of the open lockdrop period. When the calculation on applying the early participation bonus to the whole lock-schedule, I think we basically under specified what was actually happening there. In different community channels, people talked about, was it multiplicative, or was it additive? I think we made a few comments on those and then had the script in a separate repository for open inspection.

There’s that miscommunication from that perspective as well. So that was something that we’ve fixed now, but more community eyes on these types of open source projects is always helpful. To make sure that we do get everything right that all the parameters are checked. I would say, again, everything’s up there now. And so hopefully people can do another once over or twice over to make sure that everything is actually sound from that perspective.

Sunny: One of the things was that I did bring up this problem before the launch, but it wasn’t really addressed. What do you think is the best way for… This actually happened in Cosmos as well. In the cosmos hub 2 launch. The prior upgrade, from Cosmos hub 2, to Cosmos hub three, back about a month ago, that also got messed up. It turns out there were people who were bringing up concerns, “wait, we haven’t tested this piece yet.” And then when we actually get to the upgrade, it turns out, it didn’t work out. We actually did the upgrade successfully just this morning. But how do you think is the best way for community members to communicate with development teams when they see problems and make sure that these concerns are taken properly.

Dillon: I think it comes down to tooling. And so you know, on this call, it’s tough for me to remember specifically. I definitely remember, concerns around slashing being brought up. We have several channels that we use, discord specifically, we have a validator channel. A lot of discussion was going on specifically related to that issue. But as we all know, there’s so many messages being passed around in different channels that a lot of things just get lost in the fray. And so I think flagging a message, whether it’s a community admin or things that to actually surface those concerns and having a better process to run that is sorely needed so from the tooling side from a process side. Those are two ways to potentially address this.

On the tooling side, we’d hope that Commonwealth is a place for surfacing these concerns and making sure that they get addressed or talked about in a community call.

Sebastien: Yeah, I was gonna say, that is a bit peculiar that Commonwealth…

Dillon: Then and then it’s the process thing as well, so if a community member sees something, they should be able to, boost it and link to it on the store of record, on Commonwealth. It’s really tough. I think for us the things that we wanted to also do, and our plans, and the product suite is building bots to allow people to flag these things and then actually have them be talked about in the community call. If Sunny had mentioned that he should @ a bot in discord, and then we would be able to, automatically add that to some community call, or have it be shown on Commonwealth and have that be a proposal where we should talk about that thing. It’s always tough doing a bunch of things at once, and it’s certainly a humbling experience.

Sebastien: So early on after the launch in September, a decision was made through blog posts to essentially take this network that you just launched and make it into a test net. Talk about the decision process that went into making that decision. What was the reaction from the community?

Dillon: There’s a period of time, post network launch, where in the telegram channels, and discord specifically, where people were talking about different solutions for this. Applying direct hot fixes to the network through a pseudo key or basically rolling the network back to a certain extent. And we should actually talk about Straightedge with respect to this, in two seconds. Informally, everyone, it seems, came to consensus that we should, take a step back and just try to downgrade this network. We released a blog post, and the reaction to that was pretty positive.

It wasn’t an easy decision for anyone to make. I’m really grateful for the community that’s come together through the lockdrop process through the open validating on these test networks. It seems everyone’s in it and wants to see it succeed, with the right foundation set. I don’t know if there was too much backlash. I think people are still hopeful. The things we’ve heard from the community are okay, let’s take things slow, and make sure we get everything right. It hasn’t been too bad.

Straightedge was a network that was launched, I’ll let Sunny talk about that, but it’s interesting to see a side by side purchase taken essentially. When Straightedge launched, we launched with the same balance concerns, slashing as well. A decision was made to launch a new network pretty soon after that, and so it’s just interesting to see how different communities, even with the same set of token holders can change an outcome. But yeah, maybe somebody Sunny wants to comment a bit on that.

Sunny: On the Straightedge network, which we’ll get into it a bit. We essentially noticed the balances issue, and did a hard fork within about two or three hours to fix that. We still ended up having the slashing issue. We also downgraded Straightedge to a test-net.

Let’s get into the lockdrop. Personally, that was the piece of Edgeware that, when I learned about it, I was “Oh, this is super interesting. This is something new.” Could you describe to us what is a lockdrop?

Dillon: A lockdrop basically locking your token, in this specific case, and creating or minting a new token, essentially. You can lock your ethereum for three, six or 12 months, and we allowed individuals to lock during a three months period of time. If they heard about it early on, they wouldn’t be penalised for participating early or locking earlier on, they could get a bonus. And for locking for a longer amount of time, they could also get a bonus as well. And in addition to that, we added a feature called signaling. And so all you had to do was sign a message or and then an event gets pushed out. And so any address could participate in this process.

Sunny: Can you tell us a bit about why you wanted to do a lockdrop instead of a traditional token sale, or even an airdrop which is also a commonly used technique? What was the benefit of a lockdrop?

Dillon: Yeah, so it’s I think it’s basically incentivizing a certain segment of the community. TLDR, 2017, ICO craze, token sale craze, potentially attracts those individuals who are looking for more financial return or potentially attracts professional investors, and there’s also concerns around regulation, around that. Air drops seem like they can attract a certainly a wider distribution of folks who are interested in the network, but probably don’t incentivize the right crowd. Anyone might participate just because they get a chance to grab some free tokens. And so adding a bit of skin in the game in terms of locking, and giving up your opportunity cost, felt the right middle ground between a token sale and just an airdrop.

I guess the meta point, for our network going forward, there’s been proposals for Edgeware on Commonwealth to do multi-chain lockdrops and allocating tokens to different communities. I know Sunny’s talked about doing a gas drop, and going forward to incentivize or bring on different parts of community participants. Networks will use not just one, but many of these things, through the lifecycle of the network, to bring on different people.

Sebastien: Let’s talk about why this lockdrop was particularly contentious in the community. I don’t know if backlash is the right word, but it did, I think, caused some people to be concerned what came out of that. Specifically, I think we need to explain what Straightedge is, in this context.

Dillon: Yeah. the signaling feature that I alluded to, we allowed individuals, developers to signal on behalf of contracts. That was the specific point of contention, and certainly Sunny can bring his perspective there. I thought it was a very interesting discussion generated from it. We obviously had a lot of individuals participate in lockdrop and we felt it went great.

If we’re not pushing experimentation forward, crypto is so early, if we’re not having some features that people actually disagree with, then we’re doing a disservice because we certainly don’t know what the best practices are. I think it comes down to that specific thing, then a sister network Straightedge was birthed, where contracts signalers would not be able to participate. Is that correct? Sunny? I actually can’t remember at this point.

Sunny: Yeah. I could go a bit and explain a bit of what the specific concern that I had was. It just didn’t seem right, the premise of smart contracts is that the original deployer of a smart contract doesn’t have any particular ownership over that contract. Let’s say, the deployer of the wrapped Ether contract, it’s like someone in the maker foundation team, they can suddenly signal on behalf of all of the wrapped ether in the contract. This seemed wrong to me. There’s two big contracts that got signaled from, one was the DAO contract actually by Nick Johnson, and then the other is the web three foundation stuck funds, in the Parity multi-sig wallet. And that seemed odd to me.

Then there’s in the design of the lockdrop there’s a feature called the generalized lock policy, which basically said a contract that signaled from acts a lock, as an it can’t send money out, it gets counted as a full lock rather than just a signal. To me at that point, it was very clear that this functionality was added maybe not only, but in heavy part to allow the web three foundation to be able to signal on behalf of their stuck funds. To me this just seemed like some level of favoritism. I just didn’t appreciate it being snuck in. If it was decided hey, on the edge we’re initial distribution will give 10% of the tokens to the web three foundation for all their work in supporting Parity substrate and Edgeware and whatnot. I think I would have been completely fine but it just the way that it was sneakily hidden in there disturbed me.

Dillon: I don’t know if I can do any type of official response. But I totally agree in terms of, we could always do a better job of communicating and handling these things. I guess that’s a whole lesson for coordinating any type of new launch, expectations around that, over communicate is always the name of the game. I think we’ve definitely through 2019 especially with respect to the Edgeware Project, learning the lesson there.

Sunny, you and some other people launched the sister network Straightedge. Can you explain, in this context, what was different about Straightedge, and how it responded to these concerns?

Sunny: Yeah, so primarily, the main difference was that we basically we took the lockdrop contracts and at the end, we modified the Edgeware script so that they had to pull the data and to create a Genesis file. We modified it so we don’t take into account people who signaled on behalf of the contract. Everyone else who properly locked or signaled from an actual user account, their share of the network got increased. I know of people who, for example, run professional custodian services, and they did signal on behalf of some of their clients, which was the exact concern that I had. And so we went ahead and zeroed out those balances and redistributed those tokens to the rest of the network, and we launched the Straightedge network with new balances essentially. And the future of the Straightedge network is also you know, still in progress because similar to Edgeware, our September launch is also a bit botched, because of issues with the software.

Dillon: To point on custodians signaling on behalf of clients. I mean, in general, any token distribution process is, you can say there’s winners and losers. It still comes down to the specific spirit of the community, so when Nick Johnson signaled on behalf of the withdraw DAO funds, decided to give up ownership of that. It always comes down to who’s participating. Certainly there’s a few whales out there that could have participated in this whole process and just dramatically skewed the distribution of things. It always comes down to who’s actually involved with these things versus any overall process.

I think any process is to a certain extent gamable, and we have to be aware of that, but custodian signaling on behalf of their clients. I think that’s an interesting case. Because if we want those end users to actually participate in the network, that was something I think is pretty okay because if we think they’re going to be good stakeholders within the network. Then again, that was one edge case of allowing contracts with signalers to participate. It’s in the gray area and it’s really up to anyone. They could create a new network from the network distribution. And I would totally welcome that. I’m all for more experimentation.

Sebastien: I think I remember around that time speaking to people and meeting people and talking about Edgeware. And, around the time of the web three conference, people’s impressions were that at least some people that I talked to, I think the concern that people had was that somehow Parity had influence on this. That this was in some form, a way for Parity to gain influence in this network, having all these locked funds in the Parity smart contract. Whether or not that’s true, I don’t think that’s necessarily true, but it added. If there was this communication issue, the connection to Parity also created some theories about why this was in there. I don’t know if you want to talk about that or you think that makes sense.

Dillon: Commonwealth labs is an independent entity. We definitely get technical support from Web3 Foundation, and Parity. I think it’s a great ecosystem, and i don’t know if we get any special treatment. Parity can certainly be a contentious issue, especially within the Ethereum community. Even when we announced it, already things were popping up, even even in 2018. It’s interesting to hear the conspiracy theories developed.

Sunny: You know, we could go on about this topic for ages. On my side podcast, called Conspiratus, you can actually listen to a debate between myself and Ryan, and Dillon shows up for a bit. If you want to learn more about that debate, you can go check that out.

Do you think that lockdrop is really a one time novelty thing, where it was just a cool quirky idea that’s all everyone got excited about? Or do you think this is a reasonable method of doing token distributions, going forward?

Dillon: Yes, I think it’s a viable thing moving forward, as a general concept. That exact distribution mechanism, three months, six months, 12 months, might not be an actual thing, but different permutations of it.

The general concept of allocating decision making rights or tokens to a certain person who holds some token, I think is very interesting. I actually saw on Hacker News Kong Bucks, I guess they’re doing a lock drop, which is really cool. I don’t know if that was inspired by us.

I like the general concept of allocating tokens to someone who has done good work or has pulled some token basically. The laptop could be generalized to an NFT. If I hold CryptoKitties, and I wanted to launch a new Gods Unchained, and I wanted to target the certain subset, they wouldn’t have to purchase a new token, or through a token sale, but I could lock my crypto kitty in this game based NFT, even using other sources of on-chain data. This is something that Sunny brought up, if I participated in a certain network, for example, if I’ve participated in compound and any of those markets, I can be minted a new token. That token could be for a new stable coin type of thing.

So this general notion giving tokens to other people I think is going to be powerful, moving forward. Whether it’s launching a new token or even enhancing the governance system of Edgeware, like allocating a certain extra voting rights to someone based on past participation, might be an experiment that I would be happy to run.

Sebastien: So what’s the future of Edgeware? How do you see Edgeware evolving in the Polkadot ecosystem? will it become a parachain? And how is it complementary to the polka dot network in general? And also what happens to edge tokens? Are they meant to be staking tokens or…

Dillon: We think it’ll be a parachain. That is, again, up to all the token holders to vote there. Commonwealth labs only holds 4.5% of the network. The vast majority has already been allocated. So we think it’ll be a parachain. The community would still have to acquire dots to stake as a parachain. Parachain still needs its own token for spam prevention, governance rights, things like that, but it’s not used so much as a staking token.

I think the most interesting thing is how these communities work together, in the future, or how any parachain comes together. It’s basically a crypto merger. Raj and I wrote a blog post back in 2017 on crypto mergers.

Edgeware becoming a parachain network, that potentially already has an engaged community, and has overlap with Polkadot. How will that work? Will the network fork if validators don’t like the economic scenario? Hopefully not. Hopefully everything can be resolved with on-chain governance. But again, that’s what forking is for. It’s the economic scenario playing out, that all has to be discussed.

And then the last question that you asked, what’s the hope for Edgeware? In 2020, we just want to get as many DAOs participating and building on Edgeware as possible. Whether or not it’s in the crypto ecosystem. We’ve talked to Web 2, or “real world” companies, so to speak, and co-ops to create a DAO to run a coffee shop. That’s something that we’re really excited to see. As these experiments start to leak out, not just within the industry itself but into the broader world, and hopefully into this whole decade we can continue to see the distribution and usage.

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