Building Better Communities with DeFi, with Niran Babalola from Panvala

HOST:  Hey everybody.  Welcome back to the Unstoppable Podcast.  I'm your host, Diana Chen.  And I'm here today with our guest, Niran Babalola.  He's the founder at Panvala, a donation matching fund for communities that runs on its own cryptocurrency.  So I'm very excited to talk to you Niran more about that.  Welcome, Niran.  Thanks so much for being here.

NIRAN BABALOLA:  Thanks, Diana.

HOST:  All right.  So before we dive into Panvala, I want to know a little bit more about your background, and what got you into crypto.  So take me all the way back to when you first got exposed to crypto.  When was that?  And what was it that got you interested?

NIRAN BABALOLA:  So for crypto, in the beginning, I think I heard about Bitcoin on Hacker News or something and I was like, nerds think they can make money from nothing.  That doesn't sound like it makes any sense.  A couple months later, one friend of mine was like, hey, have you ever heard about this Bitcoin thing?  And I was like, guess I have to read more about this.  I read everything that I could read for like a week or two; went fully down the rabbit hole, and then I realized, nerds can make money from nothing; this is incredible.  And really just tried to wrap my head around everything.  A couple of years later, I heard about Ethereum.   At the time, I thought it was a scam coin.  Again, some nerd thought that could put a programming language in their money to make their money worth more than Bitcoin; sounds like a scam.  Turns out it's a really great idea, but I didn't realize what was going on until I started contributing as a volunteer to the Augur Project.  

So I was writing some code on the frontend and they were using Ethereum behind the scenes.  So it was actually using the technology, trying to figure out what was going on there that made it click for me what smart contracts were; what they could do.  You could write the rules for any interaction between individuals or groups of people, like it's the rules to a board game, and then, instead of needing a game master for your board game, you basically publish those rules to a network, and the network of thousands of computers will be your game master.  So if you can think of any design, of any sort of interaction that produces more value for its participants than they're putting into it, then that is now possible.  That's what that unlocks.  Any sort of system of cooperation you can think up in your head can now be deployed on chain for it to enforce for you.  So when that light bulb went off; when it finally clicked for me what was going on, I quit my job.  I found ConsenSys; this was actually before they had announced.  There was just a cryptic GitHub repository.  And I was like, oh, okay, there's somebody paying people to work on Ethereum; I need to work at that place.  I started e-mailing people, just whoever was on the GitHub account.  I'm like, hey, seems like there's a company here, I want to work on Ethereum stuff that's my background, let me in.  And they let me in.  And that started my story, working in crypto full time.

HOST:  Very cool.  So you sort of just dove right on in as soon as you could find a cool project that you could contribute to.  Before you did that, when you were first getting exposed to crypto, when you were still thinking about, you know, Ethereum was a scam coin.  How did you go about learning more about this space?  Were there any books or blogs or Twitter personalities that were really good resource for you in the early days?  And then now in 2021, obviously, we have way more resources today than you had when you first got into this space.  So talk about some of your favorite resources from back in the day.  And then today, what are some of your favorite resources for people listening who are just getting into the space and wanting to learn more?

NIRAN BABALOLA:  So early on, it was really just reading the docs.  Like, there were no books.  There weren't that many tutorials or classes or anything like that you could take.  So it's just diving in and reading the docs, and figuring out what can be done and how to do it.  So I read a lot of the like, a Ethereum, like RPC documentation, early on.  Figuring out what's going on there.  The solidity like, I feel like solidity as a language, we all learn solidity along with solidity language designers, because it was all happening at once.  But really just reading what they put out there to say, hey, this is this is how this thing works; good luck, is how it started in the early days.  

The most valuable stuff that I read early on, wasn't really about documentation or how to's or anything at all.  It was basically every single blog post that Vitalik Buterin put out from like till 2014 to 2017.  Like all of those blog posts, they're gold.  You should get back to them and read them, because really if you're like me, and at first, you don't see what smart contracts can do.  Then it's really that series of blog posts, it'll like take you through what's in his head, what he thinks is possible, and maybe you can find new things that even he didn't see and see what's possible from there.  It's like a mind opening set of blog posts.  

If you're looking for one article in particular to read.  There's a post that I think is called Libertarian Social Engineering, which if you don't like the term social engineering, I hope the libertarian part makes it a little bit easier for you.  But basically, it's just voluntary ways to shape people's social interactions with one another.  And that is behind so much of what I see in the space.  People coming together on a voluntary basis to do things they couldn't do before.  The more we can do that kind of thing, I think the happier people are going to be.  If you can come up with new ways for people to cooperate on a voluntary basis, I think there's a lot of opportunity there.  So that was the early days.  

These days, there's too much to keep up with.  I used to try to follow everything that was going on in Ethereum, and you could do that just by being on Twitter, subscribing to the Subreddit; like I knew everything that was happening in Ethereum.  That stopped to be impossible in probably 2017.  But now, it's very much impossible.  So I kind of stick to my corner of the ecosystem which is like everything involving dows or donations or like basically people coming together to do things socially rather than just financially.  That's the stuff that I pay attention to whenever there are products about that, that pop up on Twitter, I try to dive in and see what's going on there.  But yeah, I think it DeFinitely at this point—I used to have to like, try to warn people.  It's like, don't try to keep up with everything.  There's too much.  I don't think anybody even tries anymore.  But there was a while where people were still trying and you can't get anything done if you're paying attention to everything.  But now you can't even pay attention to anything.  It's just not possible.  

But Twitter is kind of where the action is for better for worse.  Like I just—every time I see something interesting; an interesting person, I follow them, and that's kind of the best way to like kind of find—build your own source of content for Ethereum, by just following people as you come across them, and unfollowing people as they go off the deep end.  That's kind of the way I do it.

HOST:  A hundred percent.  And that's amazing.  I actually haven't read Vitalik's earlier blog posts myself yet, so I'm DeFinitely going to go back and do that.  I have read the Infinite Machine by Camila Russo.  And I think she alludes to probably some of the blog posts content, but would DeFinitely love to read the blog posts themselves.  So what do you see as some of the major roadblocks that are preventing the mainstream from coming into the space?  Obviously, we've made leaps and bounds since the early days when you got into the space, but there are still tons of people out there who don't know what crypto is, still think it's a scam, or sketched out by it, you know, don't understand blockchain technology.  Why do you think that is still in 2021?  What do we need to improve on in the space to draw in the masses?

NIRAN BABALOLA:  I think there are two things.  One is key management in general, and the second is use cases.  So on key management, like in the early days, a lot of the pitch of crypto was that you can be your own bank.  But being your own bank sucks.  It's really hard to do; like you can lose all your money, you can get hacked, like being your own bank is very complicated, generating your own private keys, managing them, et cetera.  A lot of people aren't ready for that.  And I think it's always inspiring to see new kinds of wallets be created.  Things like Argent, things like Dharma, et cetera.  Things that are trying to smooth the onboarding experience to make sure that people don't completely have to be their own bank, but they can.  Like the ability to be your own bank is the empowering part, but the responsibility to be your own bank is not empowering.  So being able to have that choice, I think is really important.  So I'm really looking forward to more and more ways to smooth that onboarding process.  

The second thing is use cases.  So for a long time, the most exciting thing happening in crypto was tokens.  And tokens are such a mind bending concept to wrap your head around.  Like you're thinking about how an entire economy works.  And to a lot of people, if you can't explain it in concisive, enough a way for it to fit in people's heads, it just won't make any sense.  It'll seem like a scam.  By contrast, look at what has happened with NFTs.  When it's just one single thing that people have to fit in their heads.  They're like, oh, you're saying this is like an autograph of this art, like anybody can see it, but only I own this autographed thing.  That fits in people's heads and that's why it's exploding so much.  Like the technology can do so much more than that.  But it's all about stories that can fit in people's heads and NFTs fit.  That's why they're exploding.  That's why people are buying NBA Top Shots.  

The reason people are doing is because it fits in their heads.  And that doesn't mean that NFTs are the end or the only thing that can work.  It's just that the more we actually use the software for things that impact people's lives, that's what's going to make them understand it and start to adopt it.  For a lot of things, like DeFi kind of opened a lot of people's heads.  They're like, okay, I know that there are all these banks out there.  I mean, there's financial infrastructure and decentralizing that is appealing to some people.  That gets a lot of people on board.  But I think for a lot of people, it has to be beyond that.  Has to be not about trying to find a new way to build companies.  I think, it has to be about the problems that people see in their own lives and helping them solve those with a solution that happens to use blockchain technology, with a solution that happens to use cryptocurrency.  It's all about finding the right use cases that fit in people's heads that they can use today.  

There's a lot of people that think the time for cryptocurrency in general, to achieve mass adoption is at some point in the future that it just takes time.  Time is part of it, but I think that there is enough infrastructure today to accomplish almost anything you want with people who don't know that much about the technology.   It's just about telling the story that's inspiring enough for people to get over those barriers today, and actually being able to follow that up with actual, like something useful.  And I think the time is now.  I wouldn't say that 2021 is the year of mass adoption, but I would say that it could be.  It can happen today.  There are no more prerequisites.  It's just about innovators putting something in front of people that they can use.

HOST:  Yeah.  And speaking of relatable use cases and inspiring stories.  I think a very inspiring and relatable narrative is that around community and that's something that you talk about a lot.  And you sort of hold this view that the most important impact of the financial revolution of DeFi that people are getting into today is actually going to be its effects on community life.  So can you talk a little bit more about what you mean by that?

NIRAN BABALOLA:  Absolutely.  So if you're anything like me, when you look outside at our society, you see a society that's very dominated by political life and by corporate life, and community life kind of takes a backseat.  I see that as an economic problem.  Corporate life has equity.  It's really powerful.  Political life has national currencies, those are very powerful too.  But in community life, we just kind of pool our resources together to get things done.  And that can be effective, but it doesn't have the same power behind it that those tools do.  

So that's why I think blockchain technology is so important for community life in particular. Other parts of our society have already had economic tools, you can rebuild them on the blockchain and get some efficiencies and some new stuff there.  But where the vast opportunity is, is for community life, where those economic tools haven't been there at all.  That's what I think the story is going to be as this technology plays out.  We're going to see community life rise as a part of our society. Instead of being the sideshow, it could be the main event. And that's really where I see the potential.  That's where I spend my time trying to get things done, because I think if we could get things done without winner takes all politics, and without trying to optimize the next quarterly earnings report.  

I think we can make so many people happier, so many people happier by doing the things that they like with the people they like, rather than having to struggle about who gets what and how are we going to achieve one decision together, when there could just be many different pockets of people doing their own thing, being happy.  Like imagine if more of our economy and more of our society worked the way--if you're walking around a new city and you see oh, this neighborhood, this kind of thing is going on there.  Here's this ethnic neighborhood, here's this artists neighborhood, et cetera.  Imagine if that's what more of our money felt like.  Where instead of having to worry about like trying to get everybody to agree on one thing.  There's just different pockets where people are doing something different.  If you want to be a part of it, you can opt into it.  You don't have to win an election.  You don't have to win an argument.  You don't have to win a war, like you can just get things done with the people you want to get things done with.  Like I think the more economic resources we drive to that part of our society, the more people can be happy.  And right now, there's a lot of people who are unhappy in some way or another, like I personally think a lot of people are going really crazy these days.  And I think that's because we plugged everybody into the internet, where everybody has different opinions about everything.  But socially and economically, we're still plugged into that same old economy, that same old politics, where only does one thing.  In politics, you got to get everybody to agree, 50% plus one.  

In the corporate life, you have to do whatever makes the most money.  What about everything else?  That's what everybody's mad about, that's what everybody's going nuts about.  And if we could add another way to drive resources to the parts of our society that we choose, the people we choose to work with, the things we want to do with those people, I think people are going to be a lot happier.  That's the big opportunity that I see.  And I can't wait to live in that world.  It's frustrating to not already be there.  There's so much work to do to get there.  But I think if we lived in that world, I would be a lot happier, and I think you would too.

HOST:  For sure.  And so, I think that gives us a very natural bridge into talking about Panvala, because Panvala is a donation matching fund for communities.  So just take me to the start of Panvala.  How did you get the idea for it?  What problem were you trying to solve?  Tell me how Panvala came about?

NIRAN BABALOLA:  Sure.  So as I mentioned a little bit earlier, I joined ConsenSys; this was 2015.  And about a month in, this was still early before there were that many projects live on Ethereum.  So it's like what do we do with this technology? How can we do something that's actually sustainable?  So I sat down, wrote down a document with every kind of decentralized business model I could think of at the time; just what can I do in one sitting, and write it down.  So there are things like decentralized marketplaces and being the market maker on that platform.  

So like the same way that Uber kind of subsidized rides for a long time to make sure that the drivers and riders can be balanced and they built that up over time, so now you can get a quick ride.  Be the market maker, except on a decentralized version of Uber or Airbnb, et cetera, on that platform.  Another thing was like to be the reputation vendor on a decentralized marketplace.  In that Uber example, Uber is vetting all the drivers and all the riders and giving them ratings, making sure that people are being connected who actually want to be connected.  

Well, on a decentralized platform, you still need that thing.  So that's the thing you could charge for even if the network is open.  So those are two examples.  There's a lot more, and then the last one on that document was, well, if this technology is kind of like the building blocks for societies, for economies.  If you can write down the rules for any sort of thing, and have the Ethereum network enforce those rules, maybe we can come up with a set of rules that help people fund public goods, the things that we share in a more effective way.  And then we can use that thing to fund all the other decentralized things we want to build.  Maybe we could do that.  But that's way too ambitious.  That's farfetched, but that's the thing that I couldn't get out of my head for years.  

So I worked on a couple different things.  I did security audits, I worked on prediction markets, et cetera.  But in the back of my head, I was always trying to build these prototypes for decentralized nonprofits.  So Panvala is actually the third of those prototypes.  And the first experiment with what became Panvala was in February of 2018 at the ConsenSys company retreat in Portugal.  So I basically built a prototype of Panvala as a board game.  So we didn't have ERC-20 tokens.  We had poker chips, and we didn't have a smart contract to enforce the rules.  We had a game master; we had me.  So we basically played out that game and basically use the inflation from the system to reward the people at the retreat who are doing something to make the retreat great.  And everyday people had the opportunity to donate those tokens back into the token supply to support what was happening.  And people really took to the game.  In fact, less than five minutes after the game launched, there was someone doing a physical airdrop of these Panvala tokens from the mezzanine in the hotel that we were at.  Just throwing them off as a physical AirDrop.  That was pretty cool.  But then seeing the things that people actually did to earn the tokens was very inspiring as well.  But from that experiment, that's really what convinced me to kind of go all in on the Panvala.  That there was a way to use tokens to do more than decentralized financial protocols.  You could use them to enhance community life.  So I built up a team.  We built up the smart contracts behind Panvala and launched them on the Ethereum Mainnet in August of 2019.  And it's been operating ever since.  What we do with it is, we match donations from communities.  

We started with five communities in the Panvala League, now there are 47 communities sharing the system.  In each quarter, they bring in donations in the pan token, and we split up the inflation each quarter depend to match those donations that they brought in.  We think the more we share Panvala, the stronger it gets, and we want to share it with as many communities as possible.

HOST:  Got it.  So that's an awesome story first of all.  And I have some questions for you.  So when we're talking about the communities in Panvala, are these physical communities or are these digital communities that are formed around as hobby, or a passion, or a mindset or—talk a little bit more about what these communities are?

NIRAN BABALOLA:  So Panvala is for all kinds of communities.  The current communities are very like digital communities.  A lot of them are already like, crypto native communities.  Really what the—the communities formed around us to doing something using crypto technology.  So that's a lot of the communities that you will see today, but the ones that you described where's like a local group, like a neighborhood group trying to get something done.  There's actually a dance studio in Wycombe that's interested in sharing Panvala donation; matching fund.  That's the kind of community that can fit in as well.  This isn't about crypto, it's really about community life; everywhere we can find it.  We want to elevate across the board, throughout society.  So the only kind of communities that we exclude today are politically focused communities.  Not because like politics is bad or shouldn't exist, like politics is necessary.  It's just that that's not Panvala does, because it will be very hard to share a treasury with communities that are trying to get other people to do different things.  Like we are focused on communities of people that have chosen to be part of that community, doing the thing that they like to do with those people.

Not about trying to change other people's mind, change the government; we're not about that kind of thing.  But that's really the only thing we exclude.  Other than that, like anything worth the community coming together; funding things with donations, or membership dues, fees for ticket and events.  We want to subsidize all of that stuff and we think at the end of the day, we can build up a network of thousands of communities that work together to bring in subsidies.  Because again, like Bitcoin, Panvala's inflation topples off over time.

Like if you think about the Bitcoin model, when you buy in, you know that there's going to be a 21 million Bitcoins and there's not 21 million today.  So when you hold Bitcoin, you are kind of being a philanthropist; so thank you if you hold Bitcoin, you're being diluted to fund the Bitcoin network.  And if people didn’t hold on to it, it would not work.  We kind of do that same model in Panvala.

If you hold on to Pan, there is going to be a 100 million Pan and there's not a 100 million Pan yet.  So when you hold on to it, you are doing a new form of philanthropy.  We use that inflation to match donations from all the communities that are part of Panvala and we kind of go from there.  But like the inflation, like in Bitcoin, eventually topples off.  So we can't just be oriented around using the inflation to match the donations that we bring in.  We are also trying to build up this network of thousands of communities that can bring in external subsidies; things like corporate sponsorships, large individual donations.  We want to be at the work together to bring as much as possible to build up that collective negotiating power that can get more done.

And when I describe that to people, like a lot of people can see that if that kind organization already existed, it will be a no brainer.  Like having many, many communities working together to get resources from corporations makes sense.  But how do you start that kind of organization?  I don't think that was actually possible without being able to create your own currency to do that, because you would have to say; hey guys, in the future if you join this thing one day, we are going to be to match your donations.  But we don't have to do that.  We match donations today, because we can bootstrap it using our own currency.  And then still, one day, we are going to be bringing in external corporates sponsors and something like, but we can start with the matching today and just grow overtime.  Being able to bootstrap cooperation between communities is that new opportunity, is that world changing story that we get to be part of just because we are lucky enough to be around at the dawn of blockchain technology, and it is a privilege and an honor to be part of it.

HOST:     Fascinating.  So what are the different ways that someone can get involved with Panvala if they are brand new to it?  They can either donate; they can join a community, they can—are there Panvala miners that are mining Pan tokens?

NIRAN BABALOLA:     So there are no miners; it runs on Ethereum itself, so we don't have a blockchain that needs to be mined.  The inflation goes totally to support our communities, but there are couple of ways to be involved.  The easiest way to be involved is if you are part of one of the communities that's already part of the Panvala League, then you just donate to your community in Pan or you stake Pan Tokens to increase your communities matching multiplier, because staking is where the matching comes from.  Those people that are holding on to the Pan while the inflations happens, they're where the matching comes from.  So when you choose a community to support, that increases their matching multiplier.  So that is the easiest way to be involved. 

If you are not part of a community that is part of Panvala, you can bring your community to Panvala.  We want to share Panvala with as many communities as possible; including yours, including communities outside crypto, including communities inside the crypto.  But it's for all communities with the exceptions I mentioned before.  So bringing in your community to Panvala is another way to get involved. 

If you want to get involved as an individual, we are ramping up what we call the Panvala Token Association, where as long as you hold some Pan, you can be a part of basically the—how we connect individual token holders with one another, how we help them work together, how we help them experiment what the new kinds of communities that they can create.  We want to basically be the glue between all these different communities and really kind of be incubator for new kinds of communities that can exist once this economic tool is in place.

I think we going to see all kinds of existing traditional communities be a part of Panvala, but there's also kind of a wide open kind of landscape of new ideas that people will come with once those resources are available and we want to make that can happen.  So if that excites you; if the idea of starting new communities excites you, the Panvala Token Holders Association is the place for you.

HOST:     Love it.  So you mentioned earlier that right now most of the projects; the 40 something projects you have a crypto-native communities.  Obviously, you know, the goal is to expand to the mainstream and to be open to all different types of communities.  So what plans do you have in place that Panvala for reaching out to the, quote, unquote, "Nomies," and attracting the masses?

NIRAN BABALOLA:     So we think it's all about staring with the people in crypto, and then all the people in crypto have a life outside of crypto; maybe not everybody, some people's life have been totally consumed by crypto.  But most people in crypto have a life outside.  So it's really about the people who are already here, starting by reaching out to the communities that they are part of and see how they can benefit.  That's actually where—when I mentioned that dance studio in Wycombe that's interested in sharing Panvala, that's how that works.  They didn't randomly come across Panvala.  It was because people who were already using it were like of uh, here's a kind of community that can fit as well.  And they can fit and we hope that they succeed.  So that's basically how we see that process going.

Kind of spreading from the people who are already in crypto to bringing on the kinds of communities that are part of outside of crypto.  It is harder to onboard non-crypto communities.  They don't already have wallets, they might need to setup Metamask.  If they're making a donation on XDA, then they have to go and add a network to their wallet.  It can be an upheld struggle.  But that's the kind of work that we want to get good at doing, because, again, if we're trying to be an organization of thousands of communities that work together using this tool, we have to get really good at bringing on new communities.  So we are ready to—we have a process in place specifically for crypto newbies and to help them get onboard and to support their community.  We are ready to edulcorate on it, to test it out and keep getting better at doing that.  Because when you look at Panvala a year from now; two years from now, I think it's going to be the primary place that new people get on boarded into crypto for non-speculative purposes.

HOST:     Wow.  I love that.  And we think about the bigger community or market at large of, you know, following this vision of building community wealth.  Where do you see this space moving towards?  First of all, are they any other player in this space besides Panvala right now?  And then looking ahead to the next year or the next five years, do you see this sector of crypto growing larger and larger?  Do you see more people paying attention to this, like where do you see this developing in the future?

NIRAN BABALOLA:     Yes.  So there are other people taking on part of this huge problem to elevate community life - -.  There's lots of communities out there; there's a lot to be done.  So there are definitely a lot of players.  We don't see them as competitors, we see them as allies.  In particular, if you participated in one of the Gitcoin Grant Rounds, we worked closely with Gitcoin to match donations from different who were fund raising in crypto.  Gitcoin is part of Panvala; Panvala uses Gitcoin for a lot of stuff.  Like that's the kind of partnership that I think is necessary to actually achieve this huge goal of elevating community life.  So that's the main kind of platform that we work with. 

There's other—like the kind of people that Panvala tends to attract are communities that are also interested in this problem.  So these communities like Commons Stack and Giveth, who are building platforms and token tools to help communities be able to fund the things that they care about and we work closely with them as well.  And those are couples of like the highest profile products that I think are in this particular corner of crypto. 

Again, I think this the biggest opportunity in the whole entire space.  I think this is the used case that like NFTs fit in people's heads.  If you tell people that, you know, community should really have economic tools, point them at the landscape for political life and corporate life and show them the big missing gap in community life.  People get it; it fits it.  Starting to match donations and ramping up as you go from there.  It's very straightforward for people to get on board in this way, and I think it's going to continue to grow. 

At the end of the day, I think a lot of what happens in this particular corner of crypto will end up being that big story. It's the thing that will have the most impact on people's lives, in ways that, you know, even my life personally, I don't do that much on the blockchain.  I'm a part of a couple of doubts.  But what most people do with crypto is just speculate on it.  It's not a life-changing thing.  It's another way to manage your finances.

But once we get to those things outside of just speculation, that's when it gets really interesting to me.  When you can use the blockchain as the game master for these things that you're trying to do with other people; the social technology.  Blockchain technology is the biggest social technology, a revolution that's really, I think ever.  But like everybody saw how the internet played out and how eventually every business became an internet business, every form of media became internet media.  Everybody saw that happen.  And I think we're going to see something similar with blockchain technology when it comes to—just to social community life.  Like there won't be a community that doesn't touch blockchain technology, because it'll have that big of an impact on what we can do together.

HOST:  Yeah, I completely agree with you.  In the time that I've been in crypto, I've never seen a stronger emphasis on community than in the crypto space.  So that's something I definitely think we'll be seeing more and more of that, and people will be talking more and more about community and how can we build and orient around that concept of community.

So tell me finally about Penvala, what do you have in store for the remainder of 2021?  Any new and exciting things that you're able to share with our listeners?

NIRAN BABALOLA:  Yeah.  So for Penvala, one of the things we like to do is grow as fast as possible.  That's for two reasons, like, again, the matching comes from inflation.  And inflation works really well in a growing system and not so well in a stagnant system.  So we try to grow as fast as we can. 

The second thing is that we want to grow to be that network of thousands of communities; we're 47 communities today, there's a long road to get to thousands.  So we want to grow as fast as we can.  Our goal for this quarter is to grow from 47 communities today to 90 communities in late June.  It's an ambitious goal, but we want to continue the cadence of roughly doubling each quarter.  So if you're a part of a community that wants to be a part of Penvala, we want to talk to you.  If you know of communities that you think could benefit from the system, we want to talk to them, because we want to continue to grow at that sort of cadence.

The second thing to pay attention to, besides just the pure donation matching is the coalitions that we try to form within Penvala of the communities that join.  Beyond just the donation matching, we're kind of cooperation maximalists.  We want to help people cooperate in whatever way they can.  So just on the social side; connecting similar communities with similar goals, helping them set up recurring monthly calls to share information and share opportunities to help one another.  And we actually give each of those coalitions a Multisig wallet that Penvala funds, to kind of grease the skids of cooperation and help things work better.

We have five coalitions today.  There's the Regenerative commons Coalition; the Digital Identity Coalition, the Woman Led Web 3.0 Coalition, the Future of Work Coalition and the Crypto Art Coalition.  Those are the five today, and we want to add a more.  It's really just about whatever kinds of commonalities we find between the communities that join, we want to help them work together.  So you'll see more of those coming up this year.

And again, it's just continuing to grow, continuing to share this with as many communities as possible and showing people that this is actually a thing that can be done.  Once people hear what we're trying to do and they see the trajectory that we're on, I think it clicks for people and it's something that I think people can see how it can make so many people happier if they were able to make community life more of a focus, rather than the politics that we're all used to.

HOST:  Very cool.  I'm definitely looking forward to following along the journey and seeing where you guys go with Penvala. Another thing I wanted to bring up is you mentioned you're part of a couple of DAOs, Decentralized Autonomous Organization, which is not surprising at all, given how much you care about community.

So can you talk a little bit about the DAOs that you're a part of and sort of what they represent and how you went about joining a DAO and how maybe some of our listeners can join a DAO, if that something they're interested in?

NIRAN BABALOLA:  Yeah.  So the DAO that I spend the most of my time in is MetaCartel.  A MetaCartel founded initially as a kind of a group that was trying to make Meta transactions happen in depths, but it's grown beyond that.  And it's really just kind of a grants DAO for the Ethereum ecosystem.  We try to fund promising teams, promising projects and help them hit the ground running.  And it's really being able to meet up on a regular basis with the kinds of people who joined that kind of DAO is really a special experience with a special culture. Like in this past pandemic year, I would say the vast majority of my social interaction has actually happened within MetaCartel.  It's been an interesting time. 

But if you're interested in joining a DAO, I highly recommend it.  Again, like the—I think the story of this technology is about community lives.  So if you haven't joined a community that uses blockchain technology to try to empower what they do, I think the time to start is today or ideally a week from right now when we're talking.  Because April 26th through 30th is the next DAO Rush Week.  So DAO Rush Week is basically a collection of open house events from DAOs across the ecosystem, because they want to tell you what they're up to and how you can join, because you should join a DAO; there's no reason to not be a part of a DAO.

But the same way that I encourage everybody to like buy an NFT, even if it's a cheap one, to be part of this chapter in history.  You need to join a DAO to be a part of what's happening with community life, touched by blockchain technology.  That's really, again, what I think is the big story.  And if you want to be a part of it, participating in DAO rush week is a great time to do it.

We do it once a quarter, so if you miss DAO Rush Week Number 4, DAO Rush Week Number 5 will be coming about three months from now.

HOST:  So unfortunately, by the time this episode goes live, DAO Rush Week will have passed already, but I did just sign up for DAO rush week and I'm really looking forward to it.

And then last thing about that is for people who maybe aren't as familiar with what DAOs are and how they operate, can you talk a little bit more about, you know, like what does it mean to be part of a DAO?  What does that commitment level look like?  People might be wondering like, well, I have a full-time job, I work 80 hours a week.  Like am I going to have time to be part of a DAO and like what's the incentive?  So can you talk a little bit more about that?

NIRAN BABALOLA:  So with most DAOs the level of commitment, it's kind of just a recurring meeting.  Some of them have weekly meetings, some of them have monthly meetings, but that's kind of the level of time commitment.

I think almost anybody can fit to one hour a week into their schedule, or if not that one hour a month into their schedule to be able to participate in it.  But yeah, there's all sorts of DAOs out there.  There's a DAO that's trying to build a comic book.  There's a DAO that's trying to like bring Bitcoin to Ethereum.  There are all sorts of DAOs out there.  There's definitely one that fits what you're trying to do. And I definitely think it should be a part of it. 

I would say the most valuable parts of MataCartel for me, are that weekly call and then our kind of Telegram group and discord that we use to keep up in between calls and just having that built-in sense of community is really the biggest part.

So really just joined one and then if it feels like it's too much for you, you can always either find a different one or decide that you don't want to.  But I don't think you're going to pick that, because this is the big story in crypto.

HOST:  For sure.  Well, I'm really looking forward to DAO Rush Week and hoping to find my DAO that I can join and get plugged into that part of the community.

Well, thanks so much, Niran.  The last segment I always do on every podcast episode is called explain your tweet.  This is where I dig through your Twitter account and pull out some interesting or cryptic tweets and give you a chance to explain them. 

So the first one I have is from April 17th 2021.  You said, "Something really interesting happens when you try to govern virtual property like cryptocurrencies and NFTs.  The value is all social so there's really no other option besides stakeholder governance, even for people who are purely motivated by profit."  Do you want to break that down and explain it for our listeners?

NIRAN BABALOLA:  Yeah.  So people tell the story about how DAOs influence governance outside of crypto and in the world in general. People describe DAOs as this new form of governance that will consume companies, consume governments, et cetera.  And I try to make that more concrete.  I don't think governments are going to be consumed; I think they're still going to exist in a similar form is today.

But what does happen—what happens in a special way is that when you're trying to govern a DAO, which is typically a thing that only exists on the blockchain.  It's purely virtual; doesn't own land, doesn't own assets in the real world.  What you're governing is really relationships with the people who are part of the DAO.

You're trying to keep people together.  You're trying to get people to not split apart so that cooperation can continue. And if you're doing that, and you're just trying to govern based on who owns the most tokens or who has the most power, et cetera, it will fall apart.  People will break apart and leave. 

So that's why when people are becoming more dissatisfied with the kind of shareholder governance that drives our economy, where it's just whatever makes the most money is what happens.  When it comes to these virtual kinds of organizations with virtual property, that's not the same dynamic that takes place, because you have to keep people together.  You end up having two stakeholder governance, even if you just carry about growing your money as much as possible.  You have to use stakeholder governance to keep people together.  And just seeing that pattern is the biggest hint to me, that's something special is happening here, because a lot of the things that people say about why they're dissatisfied with the way the world works today, is the fact that they don't have a say.

I think where we're going, everybody has a say and everybody should be part of it.  Because as we shape this thing together, it's brand new, the people participating today are who shapes it.  And if you want it to be shaped in the way you want it to go, you should participate, because what's happening at the end of the day is stakeholder governance. You are a stakeholder, you need to show up to one of these things and be a part of this change that's happening in the world.

HOST:  Preach.  I love it.  All right.  The next tweet that I've pulled out, this is from March 25th 2021.  It just says, "2008 collateralized debt obligations, 2021 tokenized NFT portfolios."

NIRAN BABALOLA:  Yeah.  So for that one, I feel like an old man now, because I have stories to tell about things that happened in the past.

It's weird to realize that so many people weren't adults in 2008 and didn't see the economy falling apart.  But it's true that a lot of people didn't see it.  But the thing that took down the economy was taking all these different mortgages, all these loans for houses; they all had different properties, they were for different houses, literally, different borrowers.  But they wanted to package them up and make them something that was easy for people to invest in by saying, oh, this slice has this, the creditworthiness and this slice has this creditworthiness and so on.  And people kept repackaging those things until they couldn't tell what was underneath.  And then, the economy was kind of built on a house of cards and it fell apart and we had to kind of build it back up.  And we never quite fixed all the problems and we are still suffering from that today.

But that's kind of what people are trying to do by tokenizing NFTs.  And I'm pro experimenting, like people should try out things.  I just think it looks a lot like the same story, where you have this token that represents this basket of NFTs, but nobody's really looking at what's in the basket. They're looking at whatever the price chart is for the token.  And then things can get very disconnected very quickly until somebody is like, wait a second.  What's going on behind the token?  What mortgages are behind the security?  What NFTs are behind this token? And then when somebody actually goes to look under the curtain, everybody realizes that maybe their expectations were not met and you get a crisis.

It's a thing that could happen.  I'm not saying it's guaranteed to happen, but it fits the pattern in my head.  And for the people who weren't actually around for it, which is a lot of people.  Definitely watched The Big Short, it's a good movie, it kind of gives you the whole story.

HOST:  Yeah.  And I mean, I will say, you know, for anybody listening, who's maybe thinking, oh, wow, what a negative view on all of this?  I will say, like, I think one of the most important things we can be doing right now as we're building out Web 3.0, is to remember the mistakes that we've made in the past and make sure we don't repeat those mistakes.  Because when we were building the original internet or Web 2.0, I think the people building it had some of the same ideas in mind and some of the same goals in mind that we have now for Web 3.0, and look how that turned out, right?  So I think one wrong turn and we could just repeat history all over again.  So I do think it's really important to remember history and study history and to learn from it.

All right.  So I've got one more tweet to call out.  This is from March 23rd 2021.  He said, "Sports NFTs are special to me, because the sports teams themselves have been NFTs since day one.  It's not like owning a real business where the productive assets have clear value, it's social property that gets you in the club of other owners and players who want to work with you."

That's an interesting take, you know, like obviously very timely right now with—well, March madness just ended, but, tell us a little bit more about that?

NIRAN BABALOLA:  Yeah.  So to me, like ever since I was trying to fit blockchain stuff; decentralized stuff inside my head, I always look for what's not new.

Like it's very tempting to be able to say, oh, everything's new here; we have to figure everything out from first principles.  And I do that sometimes, but for me, I try to look for what's not new, what's been done before so I can copy, because copying is a lot easier than coming up with something new.  And I am for that.

So to me, the most common existing pattern for virtual property is in sports.  It's sports leagues, where basically, like if you're owning a normal company, that company owns something, whether it's like a patent or a factory, or like they're just Amazon, and they own all the everybody's habits—their purchasing habits like they own something real.  But sports teams, mostly the value doesn't come from owning something real.  It comes from basically their relationships with everybody else in that sports league.  So that to me is a kind of NFT. 

If sports leagues didn't exist and somebody was trying to come up with that concept today, they would say, oh, let's just like, have the set of NFTs, and if you own one of these NFTs, my team will compete with the teams that also own this NFT.  Is the same thing, but like that hint means that there's probably a lot of things they've already learned about how virtual property works that we can take from them. We don't have to come up with everything again, because like people have done so much work before us and we can benefit from them. 

So when I highlight the sports analogies; sports governance analogies, that I think are in so many places in crypto, I say that because I want more people to copy what is copy-able; what is useful from the sports world, to apply to a lot of these decentralized systems.  Because sports in a very important way are decentralized.  When you pick up a basketball, there's nobody oppressing you and telling you what to do.  But there's all this governance that led to the shape of that ball; the weight of it, the height of the goal.  And then if you're really good at the sport, the rules might change to accommodate you.  Like if LeBron James has a really good move that people like to watch, but it doesn't currently fit in the rules, the rules are going to change.

Or like if you—for basketball in particular, especially if you're in America and you might've heard of this, Euro step thing that everybody talks about now.  The rules of the NBA were actually changed to accommodate a practice that was common in Europe, which is not like the predominant basketball power, it's decentralized.  They adjust to accommodate what people want to see, how people want to play and it's a beautiful thing.  And there's so much if you're interested in governing decentralized systems that can be learned from how that works.

HOST:  That's a really interesting analogy.  That was a very fascinating, explain your tweet segment, I have to say [Laughter].  So definitely go follow Niran on Twitter, if you want more insights like this.  Niran, before you go tell people where they can find you and connect with you if they want to get in touch with you personally, and then also where they can go to learn more about Penvala, and maybe just give a quick summary again, of some of the initial things that people can do on Penvala once they sign up?

NIRAN BABALOLA:  Sure.  So I'm Niran on Twitter, that's N-I-R-A-N.  For Penvala, that's Penvala HQ.  That's a P-A-N-V-A-L-A H-Q on Twitter.  We want you to be a part of Penvala, both as an individual or as a community.  If you have a community that's interested in joining, again, head to penvala.com.  There's a button that says, submit a new community, and that's how you start the application process.  The existing communities decide who they want to work with and who they don't.  We don't really reject people; that's not what it's about.  But if we had to say no to people, the ability to stay no is held by the communities that already share the system.

So we want you to apply.  We want you to be part of this thing.  We want to match your donations; the next donation matching round is going to be in June, and we want to continue to grow the system.  So again, we have this network of thousands of communities working together to continue to subsidize what's going on in their communities.  By working together, I believe we can elevate community life to be the main event of what's going on in our society.

Right now, politics is the main event.  Quarterly earnings reports are the main event.  And I think that's not terrible, but I think we can do better.  I think so many people will be happier if we could focus more on what's going on in our communities.  And if more economic resources were going there to make it happen, you can be a part of that story.  If this is actually possible, I believe we are the ones that are going to make that happen.  And by we, I don't mean me; I don't mean Penvala in particular.  I think there's a good chance that this is what solves the problem, but like I can guarantee that the people who are going to solve the problem are people like you who are listening to this, people like you who were involved in crypto in 2021, which is still early.  This is the technology that can empower communities to a level that I don't think a lot of people can imagine. And I'm really excited to see the story that you write, the chapter that you're a part of, when it comes to how community life got elevated.

HOST:  Well, thank you, Niran, for such an inspiring conversation.

Thank you listeners for tuning in, and we'll be back again soon with another episode of the Unstoppable Podcast.

NIRAN BABALOLA: Thanks, Diana; thanks everybody.