Decentralization seems to be having a moment, although the exact reason isn’t clear. It could be because the cryptocurrency markets, founded on the principles of decentralization, are about to finish up their best year in history. It might have something to do with high-profile figures like Jack Dorsey leaving his role as CEO of Twitter to pursue ambitions in Bitcoin and digital assets.
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Taking a macro view, it may be related to an increasing recognition that a centralized and insular approach to global crises like a Covid-19 pandemic or the climate emergency simply isn’t working. However, decentralization is currently being touted as the solution for everything, from social media to personal data security – even the ongoing political division in the US.
It’s a topic close to the heart of David Atkinson, Strategy Lead at the newly-founded blockchain launchpad platform Polygen. Many launchpads are focused on specific blockchains, meaning their focus is relatively narrow and exclusive. Polygen is agnostic, aiming to do for launchpads what Uniswap did for tokens. It uses the concept of liquidity pools so that projects can bootstrap funding from investors for their build. However, Polygen’s founding principles are in decentralization, which Atkinson believes offers transformative potential – and not just in the blockchain sphere.
Atkinson is an experienced entrepreneur, adviser, and investor. Before Polygen, he joined Holochain as Commercial Director. We had an opportunity to put some questions to him regarding why decentralization matters and its role in community involvement.
At Polygen, we operate under the principle that protocols or products in the decentralized economy work better when they are genuinely decentralized. Often, it is just our creativity or a technology limitation that holds us back.
For example, when centralized exchanges started offering their own launchpads for initial exchange token offerings. Once decentralized alternatives became available, users flocked there. But there is still work to be done in further decentralizing the process, so we believe the same will happen with project launches. Coordination, incubation, and support will happen off-chain, but listing and launch mechanics taking place on-chain is a massive boost for the ecosystem in terms of transparency and democratic access.
So can you elaborate a little more on how the token launch process suffers from centralization?
All sorts of crazy things go on with token launches – fungible and non-fungible. These crazy things then spawn new industries, like the world of anti-sniping bots. But if the design choices of the application itself could help to prevent issues like scalping, whales eating the whole token supply, bot attacks, or manipulation – with true decentralization, these problems go away.
How did you come to token launches as a focal point for enhancing decentralization?
We set out to establish a fair value for illiquid assets in a permissionless way. We built using decentralized principles from the outset, so no centralization of keys, liquidity, or processes. While we didn’t specifically focus on token sales in the beginning, a natural consequence of this is the creation of a launchpad because that’s a place where groups of people are testing out the interest and value of something they are building.
One of the challenges of decentralization is that it’s a journey, as every project needs time to build a community. That’s what led to the evolution of the IEO in the first place – because it negated the need for a project to go and build its own community, as we saw in the ICO. But in both cases, the community only exists for a frenzied launch to people who only really care about the token price.
So for projects to achieve true decentralization, they need a real community invested in the long-term interests – a middle ground between projects attracting funds and projects building community.
Are there any risks with decentralization?
There are always risks – the risk of people exploiting smart contracts, the risk of low community participation, or of projects falling flat before launch. There is still, unfortunately, the risk of projects scamming participants.
Some of these risks can be managed and mitigated, and some are discovered along the way. But none of them is a showstopper for achieving decentralization, as the many success stories from the blockchain space can demonstrate – most obviously, Bitcoin and Ethereum, the two most decentralized projects of all.
Where did your passion for decentralization come from?
I spent a lot of my twenties living in the desert in Australia, and some of that in Aboriginal communities. My time there showed me some of the weaknesses of centralized state governance. Remote central Australian community life is quite different from a major eastern city in Australia. I don’t claim to be an expert in how to impose centralized governance on Aboriginal peoples, but what I saw was that government representatives would make a few visits and, in many cases, try to push national or international standards around living conditions or water quality onto a community without really understanding anything of community life.
One example I saw was that the government tried to nationalize water standards and approached communities with much fanfare announcing new water standards for all. Within weeks the equipment broke, there were no maintenance companies around, the community didn’t have the skills to fix anything, and water quality had worsened. Overall, they were worse off and even more dependent on the government than before.
After seeing this play out, I developed a commitment to technology and systems that support healthier patterns and create more independence for communities everywhere.
How do you turn that passion into code?
By finding and working with people who are deeply opinionated about the way the world can and does work. Partners who are clear on their principles and building technology aligned with these principles. That way, the products built have a personality and opinion. And that opinion is written into each decision. To do that, you need to work in groups conducive to conversation, independence, clarity and a shared sense of purpose.
What’s coming next?
We just had the Polygen ($PGEN) raise that was oversubscribed followed by the $NITRO raise, also oversubscribed! And then shortly after that we are open to automated raises which makes the entire process fully permissionless. Can’t wait!