"We Were Idiots and We Were Poor; Then From Mid 2020 to Now, Suddenly, We're Right: " Ameen Soleimani
In this week’s podcast episode we interview Ameen Soleimani, one of the most prolific builders in Ethereum. He’s the CEO of SpankChain, a blockchain-based adult entertainment platform, the co-creator of MolochDAO, a DAO to fund Ethereum projects, and the co-founder of Reflexer Labs, which created RAI, a purely ether-backed stablecoin.
We talk about the need of a purely ETH-backed stablecoin, and how RAI is so cypherpunk it’s not only not backed by fiat, but it’s also not pegged to the dollar, it’s only pegged to itself, and stabilized by its own algorithm. It’s a pretty radical experiment and Ameen has very high hopes for it: The goal is for Rai to become a global reserve currency.
We also catch up on SpankChain, which is now a crypto payments company. It’s interesting that the project was very early in the scaling game—it was launched in 2017 using state channels— but Ameen explains why he’s not using Layer 2 anymore, and it comes down to user experience.
Ameen also talks about why he’s now posting his own porn videos; he says it’s about breaking down stigmas and making the statement that sex is normal, sex videos are a form of expression, and that sex work should be decriminalized.
We also talk about why so much of his work gravitates toward religious elements —calling Rai the MonayGod, for example— and he opens up about how it may be a reaction from growing up in a very strict, religious household. To him Etheruem isn’t just about building cool, decentralized stuff, it’s also been a way for him to redefine what “God” is.
The podcast was led by Camila Russo, and edited by Alp Gasimov.
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🙌 Together with:
Zerion, a simple interface to access and use decentralized finance
Balancer, an asset manager and decentralized exchange built on Ethereum
Kraken, consistently rated the best and most secure cryptocurrency exchange, which can get you from fiat to DeFi
Casper, an enterprise-focused blockchain which aims to introduce unprecedented security, speed and scale for businesses
Ameen Soleimani: It was like 2011, 2012 that me and some of my college fraternity buddies bought mushrooms on the internet, from the Silk Road and had a great time and it was an eye-opening experience. Unfortunately, we didn't buy as much Bitcoin as we could have. But you know, shortly after that, after graduating, I wrote a Bitcoin arbitrage bot, I made a couple dollars off of the arbitrage. I made $1,000 off of the Bitcoin bubble in Mt. Gox and lost everything. And then I wasn't very rich at the time.
“...me and some of my college fraternity buddies bought mushrooms on the internet, from the Silk Road and had a great time and it was an eye-opening experience. Unfortunately, we didn't buy as much Bitcoin as we could have.”
But then I sort of walked away from crypto for a while and then only got back into it once I discovered Ethereum. And I thought it was interesting, as a programmer, I could write code that ran on Ethereum and I thought that was fascinating and could have potentially large implications and joined ConsenSys ultimately, in the summer of 2016, and I stayed there for a little less than a year, did some fun work there. We worked on advertising stuff, worked on scalability, payment channels, state channels, those kinds of solutions, and then eventually left to start SpankChain.
Camila Russo: Nice. Okay, so interesting that mushrooms was what first got you into Bitcoin with the Silk Road. And I'm guessing, I mean, having programmed an arbitrage bot and then becoming interested in Ethereum because of smart contracts, are you a programmer by training?
CR: Nice. So you're kind of self-taught on the programming side?
AS: Yeah, self-taught software engineer.
A Money God’s Origin
CR: Okay, so now fast-forwarding, and we'll go back to talking about SpankChain, and the rest. But I want to start off by talking about RAI, which I find is a really interesting and exciting experiment. But if you can explain what this is. As I mentioned, RAI is a stablecoin that's based only on ETH. And so first, I want to start off by talking about why you thought it was important to have a purely ETH-backed stablecoin.
AS: So I'll take you back to the beginning of RAI. Which is like, my involvement in this, it's bigger than me. I'm just part of the group that is bringing this technology to life. I was frustrated last year, mid-February around ETHDenver, because MakerDAO was starting to add lots of collateral, they're making lots of decisions, and I really appreciated DAI when it was single collateral, when it was just backed by Ether, it was less complicated, and there weren't a whole lot of moving parts.
“I really appreciated DAI when it was single collateral, when it was just backed by Ether, it was less complicated, and there wasn't a whole lot of moving parts.”
And I thought that as they introduced other forms of collateral, especially collateral that introduces counterparty risk, like something like WBTC, it introduces a trust assumption to the system. If I'm a DAI holder, I am now downstream of the risk of WBTC blowing up because of some custodian, or something happened. So, I thought that it would be useful for me as somebody who primarily wanted to hold DAI, and useful for Ethereum to have something like that. And so I published a blog post called Metacoin. And the Metacoin blog post, I put it on the Ethereum research forum, got a lot of attention. And I put my design for how I would do MakerDAO.
And part of what I wanted to do is also governance minimize it, so to try and take humans out of the loop for deciding on the interest rates and stuff like that. So being backed by ETH is one part of it, being governance minimized is another part of it. And they're both pillars of the same idea, which is to try and achieve social scalability by getting the humans out of the loop. So you don't need to trust some group of humans, like, you sort of need to trust the MKR holders or the Fed or whoever, to try and get as close to ETH moneyness as possible. And in order to do that, try to eliminate as many of the trust assumptions.
“...part of what I wanted to do is also governance minimize it, so to try and take humans out of the loop for deciding on the interest rates and stuff like that.”
So, I published this Metacoin blog post, and then I got feedback from the original co-founder of MakerDAO Nikolai, who's a super genius, and he was like, actually, this was my plan. I was going to create MakerDAO in this way. Originally, if you look at the white paper that we published in 2017, it's like this. But I also have this other twist to it. And so in my original post, I was proposing to do the same thing that Maker is doing where it's pegged to $1. And the interest rates would not be set by committee or vote, it would be set by an algorithmic PID controller. We'll come back to what that is a bit. And Nikolai is like, yeah, I had the same idea, but like, you actually can do this without needing to peg it to the US dollar at all. I was like, mind blown, like, tell me more. And once I realized what he was describing, I was like we have to build this.
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