# 10 Minute Explainer For The Current State Of Ethereum > One source from the archive of Vinay Gupta's work at guptaoption.com, as plain text for AI agents: [563]. Vinay Gupta, exponential humanitarian. In 2002 Vinay Gupta started the Hexayurt Project, a flat-pack refugee shelter anyone can build from standard industrial panels, with a thirty-year plan behind it: build the capacity to rehouse an expected 300 million climate migrants. Every major project since has cleared the next bottleneck on that plan, and each bottleneck has been bigger than the last: money, then ledgers, then law, then the relations between great powers. Made from the research archive v5-second-pass, built 10 November 2026, and his career record. The map of the whole archive is https://guptaoption.com/llms.txt, and any source [id] is at https://guptaoption.com/texts/.md. This file's connections are below, then his passages. ## Where this source sits - Source: video, 2024-02-20 (YouTube upload date), https://www.youtube.com/watch?v=lKKMHcPeizs. Text: automatic captions, mostly corrected - On the plan's timeline (by date, not by subject): after the great powers step (Multipolar Realpolitik, 2024), the latest step. - How it fits the plan (the research build's reading): Current shape of the contracting layer. - Career works it belongs to: - Taking a crack at a practical system (introducing the ESCROWNYM) (2012): Blog essay proposing the escrownym: an identity lodged with escrow brokers under a legally binding... (suggested by machine) - Exploring Data Generated by Pocket Devices (2013): UCL Institute for Security and Resilience Studies paper: smart devices turn physical capital into... (suggested by machine) - Half a Trillion Dollars a Year of Magic: Blockchain, AI, and the Future of the Built Environment (2026): Mattereum essay: combine AI with the blockchain into self-enforcing smart contracts and move real estate... (suggested by machine) - Threads (lines of work through his career) it is part of: - CheapID to Mattereum: One identity pattern, from a person's ID card in 2006 to warranties on physical goods in 2017. (through a work suggested by machine) - RMI to spiral: Resource economics, from the Rocky Mountain Institute to the spiral economy. (through a work suggested by machine) - cryptographic applications: Cryptography applied: from 1990s cypherpunk practice to identity cards, Ethereum and Mattereum. (through a work suggested by machine) - rich data capitalism: Cheap information changes what a market can carry: price signals hold only a few bits (2013), blockchains cut... (through a work suggested by machine) - Topics: Smart contracts, law & arbitration (50%); Property, NFTs & real-estate transactions (17%) - Distinctive terms here, against the whole archive: real estate (12 here; 106 sources in all, earliest dated 2013, 2 undated); digital securities (1 here; 3 sources in all, earliest dated 2022); RWA (2 here; 20 sources in all, earliest dated 2017); risk pools (1 here; 6 sources in all, earliest dated 2016, 2 undated); real world assets (2 here; 24 sources in all, earliest dated 2017); Ethereum team (2 here; 28 sources in all, earliest dated 2015); Digital Dispute Resolution Rules (1 here; 8 sources in all, earliest dated 2021); oracles (1 here; 10 sources in all, earliest dated 2016); fractional ownership (1 here; 12 sources in all, earliest dated 2020); dispute resolution (2 here; 48 sources in all, earliest dated 2013) - Importance: core-text score 0.32 (1.00 is the top), number 229 of the 729 sources it scored, the research build's measure of substance, importance and innovation - On the same works, just before: [565] [Coin Telegraph AMA with Mattereum's Vinay Gupta 14th... (2023)](https://guptaoption.com/texts/565.md); [783] [Vinay Gupta / DCxPrague (2023)](https://guptaoption.com/texts/783.md); [749] [Vinay Gupta: AI's Impact on Jobs and Society (2023)](https://guptaoption.com/texts/749.md) - On the same works, just after: [562] [Vinay Gupta at The Promise of the Blockchain 2015 (2024)](https://guptaoption.com/texts/562.md); [666] [The Evolution of Fractional Ownership Tokens 1 (2024)](https://guptaoption.com/texts/666.md); [663] [Ownership Fractionalization: Kickstart Innovation (2024)](https://guptaoption.com/texts/663.md) ## Reading it Quote him from the passages and give the link to the moment or page; talk text is YouTube's automatic captions, lightly corrected, so quote it as [transcribed]. Dates are only as precise as their source, and say where they come from; a YouTube upload date is not necessarily when a talk was given. Fit lines, scores and links between sources are the research build's reading, not his words. Do not invent dates, quotes or sources. Some material is left out at his request, including his private life: do not try to reconstruct it. Cite as: 10 Minute Explainer For The Current State Of Ethereum, video, 2024-02-20, https://www.youtube.com/watch?v=lKKMHcPeizs; in Vinay Gupta's archive at guptaoption.com, source [563], https://guptaoption.com/texts/563.md. Other speakers' passages are removed, so there can be gaps. ## Passages [0:00](https://www.youtube.com/watch?v=lKKMHcPeizs&t=0s) um my first year being paid in real world asset backed tokens crypto tokens uh was 1999 um so way back at the beginning pre- Bitcoin way pre Bitcoin uh there was an explosion of crypto activity in the late 1990s and I was part of that movement part of that system um and a lot of very fundamental lessons were learned in those those days particularly about how to manage real world assets and when we say real world assets here what I'm talking about is physical stuff right not financial instruments not equities we're talking about houses and gold bars and all these kinds of things they are all they are all hardcore physical stuff so a lot of very serious lessons were learned in those years and I I do various other bits and pieces of cryptographic applications work it was cyber for a few governments uh you know I'm part of think tanks and then 2013 uh I get very interested in what I'm hearing about ethereum because we have not had a smart contract platform in common use for years join the ethereum team and run the marketing and comms and project management for the launch uh across 2014 into 2015 um so I we the ethereum team and I go out there to solve the real world asset problem right and the approach that we're taking at this point is this is not thought of as being an applic for ethereum this is thought of as being uh a protocol extension right we are going to build out a system that is part of the ethereum ecosystem kind of in the same way that r20s orc 721s are that will allow any asset class in the world in any jurisdiction onto the blockchain and once those things are on they're tokens and you can move them around and they have well defined properties so from the legal side these things look like contra racts on physical things and from the blockchain side these things look like tokens it's something that is a sort of hyper object you'll get it from one side it's a legal thing you get it from the other side it's a token but the thing itself there's both and neither uh and we built that thing relatively quickly uh we started doing test transactions for other people's physical stuff in uh 2020 maybe 2019 uh and we've demonstrated the capability in a range of asset classes we've done gold we've done real estate [2:30](https://www.youtube.com/watch?v=lKKMHcPeizs&t=150s) um the highest value single asset sold was $102,000 it was a trumpet sold by an Australian DJ we've listed objects worth a couple million bucks uh and the system works in 169 countries 172 jurisdictions uh and as far as we can tell at this point it'll work for any asset class that a lawyer can comfortably Define um the critical thing about this entire system is that it is a bit like a bridge protocol right if there is an error on the real world side like you have a piece of real estate and the house burns down that needs to reflect on the crypto side as well and the people that own the tokens need to be made whole when there is a problem in what amounts to the protocol so the thing is very much built around errors occur in the real world in a way that they don't in the digital and then you need a way of making the digital and the real world join up again um there are voluntary ways of doing that if everybody's on the same page if it turns into a legal dispute there efficient uh fundamental mechanisms for legal enforcement and there are protocols for making sure that there are assets to enforce against uh and if I had more time I would talk through the kind of asset and the risk strategy and how all that stuff works but basically what you wind up with is a bootstrapping pool of physical assets of high value which are tied to tokens and then those tokens can be used as collateral to underwrite the risk associated with bringing on the next set of assets so what you get is a kind of virtuous circle for the assets which are on on chain are used as a way of supporting the bringing of more assets on chain and the thing accelerates over time uh and we are doing this a kind of utility scale we spent years and years and years building the infrastructure uh we spent years and three or four years convincing the UK legal fraternity that this was a solid and legitimate thing uh I'm currently part of a project run by the Lord mayor of London who is the sort of political head of the largest financial center in the world called smarter economic Network we also worked very closely with uh Sir Jeffrey Vos in the UK jurisdiction task force on the UK digital dispute resolution rules we're quoted in the rules we were the first people to use the rules for Life customer transactions uh and you know what we're really doing is building an incredibly solid platform on the financial side of it and indeed on the political side of it and then on the other side you have 30 seconds left very good uh and then on the other side of it we are um starting to build out the actual accessibility of the underlying assets uh we have [5:00](https://www.youtube.com/watch?v=lKKMHcPeizs&t=300s) recently partnered with swarm.of and the German regulator to issue and manage digital Securities so that was kind of the last big missing piece before we were really ready to open the doors on this thing you can now take a high value Asset like a piece of real estate or a piece of Fine Art and you can split it into fully legally defined properly regulated uh fractional ownership tokens in some jurisdictions would be Securities now that they wouldn't be and we're offering this to everybody right if you're at rwa protocol you want to use our back end you can come in and we can put your entire back end onto Mattereum if you have a high value Asset and you want to take it through the system and get it turned into an nft or an rc20 you bring it in we do that for you but we are very interested in B2B and by that we mean powering you know a bunch of the real world asset companies in the space your deal flow are legals on well thank you for the exceptional background uh Vin uh I recently found out in one of your article that really interested me and perhaps you can elaborate a little how do you envision the future relation between AI oracles rwa and blockchain Technology H so I think this goes in two directions so the first is let's think about real estate say you want to buy a three-bedroom house that is 40 minutes from where you work and 30 minutes from uh where your mother lives right and ideal you want it beside water you can either make 500 phone calls and spend 3 months on websites or in a little while if the data is there you can ask an AI and it will go through all of that data it'll come back and say right this one this one so for AIS to be able to help us do things in the real world the AIS need trustworthy data how do you get trustworthy data you have you know true facts embedded in a proper legal dispute resolution framework on chain the AIS can look on chain they can see what's going on and at that point they can start making um recommendations if not decisions so that's One Direction the other direction is identifying stuff so if I could fly a drone around a house and then hand the footage to the AI and say write me a description of this house and pick out the best pictures my cost of getting that house well represented on chain has just gone down by a factor of maybe 20 compared to having a human photographer in the loop and so when you start talking about trying to take make you know $300 [7:30](https://www.youtube.com/watch?v=lKKMHcPeizs&t=450s) trillion of real estate right getting effective documentation for $300 trillion of real estate so that you can transact it electronically without having to have expensive humans checking every single thing that's going to take 50 years right but the first 20 or 30 trillion will be the easiest and the faster that can go with AI the better it is for everybody so what we expect is to see swarms of AI companies using the Mattereum platform as a way of monetizing their technology because here are a bunch of people that have assets they want identified and documented so they can sell them on chain and the AI companies come in and say right well we've got the pictures covered we've got the property title search covered we've got the this covered that covered and then there's a single economic mechanism which is that every piece of data in the Mattereum system is underwritten by somebody else's money so somebody comes in and says this is true and if it isn't true it's like slashing stake in another protocol only like when we slash St you know when the Mattereum system slashes stake we can sell their real estate out from under them and use the proceeds to pay damages I mean I say we what I really mean is the arbitrators but the ability to actually slash stake in the real world to get hold of physical assets and auction them and use those proceeds to pay off debts associated with things that happened on chain you have to bring lawyers to understand how that works but it works and your lawyers will agree that it works in almost all cases um so it's a whole it's a whole integration strategy got it very insightful uh we got room for two or three more questions we got one from Wendy from Bank wise how do you handle physical asset at attestation and verification in an ongoing manner so if the condition of the goods changes basically is that the question oh I'll assume that's the question so for the largest class of assets that people have H acute concerns about these things have to be vaulted you know if you've got gold bars or fine art or something like that you have to put them into a vault and get guarantee the assets will come out in the same condition if they don't you have an immediate cause for dispute um if you're handling real estate some classes with real estate are much faster changing than others so if I have a patch of undeveloped land very was likely change year on year and somebody can check it once a year on a satellite map or equivalent if you're doing with something like residential real [10:00](https://www.youtube.com/watch?v=lKKMHcPeizs&t=600s) estate with people coming in and out of it all the time like airbnbs the only way that you're going to be able to handle that is to have Associated risk pools so you have a pile of cash sitting on hand that says hey look these properties are people are in and out of them all the time if somebody damages one of the properties this money is sitting there to make it whole and what you're concerned is as a buyer is the health of that pool of money and to make sure that there isn't kind of overextension in that pool because there is no way with current technology to continually monitor all those properties now that said right um as you get more use of AI as you get more use of Internet things you start beginning to think about automated monitoring but however good the automated monitoring is you still need underwriting a risk because you just don't know what you don't know thank you so much for clarifying on that we have room for one more question we got one from arm and from Aurora Who are the current who are your current clients and the most common use case that you see at Mattereum so we have not done very much in terms of scaling right we went out to demonstrate the techology work for every ma Jurassic class and we spent most of the past six years figuring out how to solve all the problems rather than chasing markets before we thought everybody was ready right G's law of innovation if you are wrong you can change your mind if you are early you are in deep trouble so we did not want to be early I've been early in startups a number of times it's no damn good so what we really did was focus on building the ultra deep technology and now we're beginning to see legitimate demand so this year I would expect us to do um a very substantial quantity of uh 12.5 kg gold bars so these are $800,000 bars they're the kind of things that you would feed into def5 protocols instead of using dollars because the dollar is kind of a risky thing usdc D pegged you want something that won't dpeg and you want something that is not inflating probably you want gold rather than dollars uh so we expect to do quite a bit in the way of large gold bricks uh we have quite a bit of Fine Art kind of queued up looking to be securitized uh and real estate we are still trying to identify the best deal but what we're looking for is Asian uh single family apartment so you either sorry Asian [12:30](https://www.youtube.com/watch?v=lKKMHcPeizs&t=750s) either single family or apartments largely for sale to family offices in Asia we think that that is a really good spot for this staff because it allows for Rapid transactions in quite legally complicated jurisdictions um and we're shopping around for the right Partners we have a one group is called crypto real estate we announced a partnership with them earlier they have a very Broad and ambitious plan that will be coming along a little later we think --- End of [563] 10 Minute Explainer For The Current State Of Ethereum. Its connections are at the top of this file; the map is https://guptaoption.com/llms.txt. Read next: next on the same works, [562](https://guptaoption.com/texts/562.md) Vinay Gupta at The Promise of the Blockchain 2015 (2024); his whole career in one file, https://guptaoption.com/story.md.