0:10 • Avi
Gm Delphi fam. Welcome back to the Delphi Podcast. This is Avi from Delphi Ventures. Today we have another episode that’s part of our Delphi Web3 Series. Our guest, Danny Zuckerman, is the co-founder of 3Box Labs. 3Box Labs has been working on building out the Ceramic Network, ecosystem for decentralized data storage and management. In this conversation, we cover: what is decentralized data, how does Ceramic enable data composability, what does the future of data interoperability look like, which projects built on Ceramic you should keep an eye on, and why the dataverse is the new metaverse. Without further ado, here’s Danny. Hey, Danny, how are you doing, man? Thanks for joining us today. I’m really excited to dig into Ceramic and learn a bit more about what you guys are building over there. Before we do, please introduce yourself to our Delphi listeners.

1:03 • Danny
Sure. I’m Danny Zuckerman, one of the founders of 3Box Labs. We’re the creators of the Ceramic Network. We’ve been working on making it easy for developers to use decentralized identity data for four and a half years now. That has taken us a bunch of different ways to get to Ceramic which we’re super excited about and is growing pretty rapidly now.

1:26 • Avi
Nice. Four and a half years is a decent amount of time, especially in crypto terms, relatively speaking. I’m curious, what was your red-pilled moment into crypto and blockchain technology?

1:42 • Danny
What hooked me about the crypto and decentralized tech space is I’ve always viewed it as the best coordination tools we’ve ever had. It was 2016 when I’d taken a break from building products at my last job and was traveling and reading a ton and digging into all sorts of things, and I decided to finally understand what this blockchain thing is. I just did a ton of reading, and there was no one thing that did it, but as I learned more about the tech, read pieces from Chris Dixon and Joel Monegro, and met a bunch of people working on it, it really did crystallize, “Oh, we spend so much of our time and our lives online today.”

2:23 • Danny
That really is our digital society, but that whole society is shaped by really inefficient coordination mechanisms and a few people in control. This way to gather, collaborate, and coordinate is much more scalably, effectively, fairly, and fluidly – that’s what hooked me. I started to look at the different holes in the space where I might plugin, and there was even in 2016, a very evident gap to be able to build on the data side of applications and things that we do online as opposed to the value side. That’s what got me in. uPort, which was a really an early pioneer in decentralized identity in Ethereum and crypto, is where I met Michael and Joel, my two co-founders at 3Box.

3:19 • Avi
Nice. Tell me a little bit more about distributed data and storage. What does that actually mean? What’s happening on the back end there?

3:31 • Danny
Let’s just talk about the whole data stack, why it matters, and what’s been missing that kind of led us to this. You go online to any application today and it’s kind of running on a few different things: it’s running on code, it’s running on data (like all of the information that populates the websites that you see whether it’s your user data or application data), and then there’s some value mechanisms to create business models around it. A huge portion of any application, product, or service online today is the data that drives it. Think about the Web3 stack and the dApps and apps in the space that we’ve seen to date. They’ve really been missing all of those data driven features.

4:19 • Danny
They’ve really been about value programs, storing and tracking assets and contracts of various kinds, and that’s what blockchains are really good at. If you think about the data side, we’ve had really good storage layer solutions like Arweave, Filecoin, and IPFS, but what we’ve been missing is the kind of mutability, state transformation, and structure on top of it that would be provided by a database in Web2, and I don’t just mean the raw disk space, but the ability to process and use data in high volumes, very fast and in really rich ways. That’s why we haven’t had social networks and user-generated content or even rich profiles and reputation in Web3, because we didn’t have the equivalent of the database layer in the stack. That’s what we’ve needed to be able to take Web3 apps to a really rich and exciting place. That’s a little bit of an overview of why we built Ceramic.

5:22 • Avi
Nice. I pulled up here this diagram of the Web3 application stack. Just for reference, what is being used today on this side of the equation? How are actual Web3 applications built and managing their data?

5:44 • Danny
Yeah, there are kind of three ways. The most common is that they just haven’t been, and that’s why you see so many Web3 applications that instead of a profile have a hex address, and ENS is taking care of that in some ways for really basic profile information or names, but we don’t have those data-driven features like rich commenting, discussion, and user-generated content because we haven’t had the tech. Those who do really want those features, mostly just use a server.

6:13 • Danny
Even decentralized applications, or those building for that market, have had to rely on a traditional database for some of these richer, higher-volume data features, which is problematic for a whole bunch of reasons beyond just the decentralization ethos. Those who have been really committed to decentralization have put content on IPFS and then tracked hashes as the content gets updated, either in a database, which brings you back to the same place, or a smart contract, and that just doesn’t scale. It ends up costing you (if you’re doing it on Ethereum) 10s of dollars when you want to update your profile name or make a comment or something, and even with L2s or more scalable L1s, that type of tracking state changes in a value blockchain will never scale for the kind of throughput you need for data features, and that’s why most people have chosen just not to build those data features and focus on the smart contract layer.

7:14 • Avi
Yeah. This is great. I think this is a great segue into Ceramic and what is Ceramic exactly. We’ve spoken a few times now, and a lot of people, including myself, are feeling there’s a little bit of ambiguity or mystery around it. Coming from the man himself, what is Ceramic?

7:49 • Danny
Ceramic makes it really easy to build with decentralized data by providing this layer on top of IPFS for managing state transformations and keeping track of that and then associating the data to data structures that make it really easy to consume, read, and build an application around, and then saving and storing that data with a user. That really boils down to: it’s a solution for user-centric data, which has been a huge part of the Web3 vision for a very long time. The user comes to an application, and they do a bunch of things and a bunch of data gets generated, and where does it go?

8:34 • Danny
Instead of putting it directly on IPFS, where now you have this challenge of tracking it over time and when the user comes back you have to associate it, with Ceramic it all just gets saved with the user associated to the key and the identity that they’re bringing with them with any blockchain wallet. As a developer, now you have this kind of bundled solution in the form of a protocol and shared database to kind of structure your data for whatever you need, for whatever feature you want. We have this concept of data models, so developers write the data model that corresponds to the features they want, and then every time a user comes to their app, they get records in Ceramic on top of IPFS that correspond to those data models, and when they go to another app, they can bring it with them. When they come back to the original app, it’s still there.

9:24 • Danny
You have this ability to build fully decentralized applications with really rich data features that you as a developer decide how it looks and how it’s structured, and it’s all stored with the user. You’re giving them control, and you have this composability across applications. You have the ability to take app data with you the way that you can assets on a blockchain. What enables that though is this mutability on top of IPFS, which is static files, and Ceramic provides a way to keep track of content as it changes in a verifiable way.

10:03 • Avi
That’s awesome. Just to try and repeat back what I just heard: IPFS is good for state static data, right? Ceramic is now this framework to create mutable data tables that are tied to a user. That’s really cool. What are some of the things that you’re excited for now? Okay, now that we have this, what does that mean? What are these data-rich features that I can now build as a developer on a completely distributed data storage network that I wouldn’t have been able to do before in a completely Web3 manner?

10:47 • Danny
Let’s talk about two use cases as a very long tail because it’s similar to a database, right? A database can do anything that a developer can dream up, really. It’s just a matter of configuring it, but the first one that’s getting tons of usage is identity and reputation. Again, a core part of the Web3 vision for a very long time is to give users much more control to bring their identity with them from application to application and start to accumulate a really rich reputation around them instead of being fragmented in lots of different apps and platforms.

11:22 • Danny
There are a bunch of different forms this is taking. DAO House, just today (on February 4) launched a really rich profile for DAO members that uses Ceramic, because now you can start to attach all this information, across accounts, and wallets, and even blockchains to a single user and let them aggregate all this information and take that with them. Beyond just profiles, Rabbithole, which does user onboarding for Web3, is having users accumulate skills for different quests that they complete. Those credentials for those skills need to be stored somewhere. Now they can store them in Ceramic so that they’re associated directly with a user, and a user can again, take them with you across blockchains accounts, and accumulate this basically on-chain resume.

12:19 • Danny
It’s starting to attach all this really rich data beyond just on-chain transactions. What’s really exciting is there’s a group called Metacred which is a whole bunch of people that need reputation/skills/credentials in various ways, and they have come together to start to collaborate on what is the data model or the set of data models that we should all use to create this information and store with users such that it’s now not just for any one application, but this data gets used across the ecosystem. Being able to build this really rich reputation for social applications, for governance… Boardroom was one of the first to use Ceramic for letting people in different DAOs ideate and discuss governance proposals and start to have some reputation associated with it. This reputation unlocks huge social features and governance, along with that it’s kind of the same primitive for credit for DeFi applications as people move towards under-collateralized loans. Being able to build up this identity reputation is a really big first use case for Ceramic. I have another one I talk about around social but I’ll pause there. Does that all make sense?

13:33 • Avi
Yeah. I pulled up here the awesome Ceramic list of projects that you guys have on your site. I’m not sure how up-to-date this is, but a lot of these are kind of social-oriented credential systems or social graphs. Is that what you’re seeing? Is that what you expected as the primary use case for Ceramic, or is there something else that you had in mind?

14:06 • Danny
Identity reputation was the first, but social really is the second. You’re right, and I’d say that’s come on even faster than we expected. That takes a few different forms. One that may not be on there yet, but that’s super exciting, and they’re doing incredible work is CyberConnect, which is basically built along with an application and kind of a social graph protocol on top of Ceramic and really easy structuring and indexing for it so that anybody across Web3 can build on the same social graph,…

14:38 • Danny
…So that no matter what application you’re going to, you still have the same follower/friends list, and you’re not recreating that everywhere. They’ve gotten tons of adoption, I think, especially in China, and creating these network effects is really what gives some of the Web2 platforms so much power and leverage and lock-in, and shared network effects in the form of social graphs or other networks are a huge part of what’s going to make Web3 successful. CyberConnect has started to put this into place already, but beyond just the social graph, there’s another project called Orbis, Orbis.club, that basically cloned Twitter in a matter of a couple of weeks building on decentralized data, mostly Ceramic. Being able to create these communities and conversations and a feed of content in a fully decentralized way means now anybody else can go create another interface for the same content and have a much more powerful experience.

15:41 • Danny
If anybody hasn’t checked out Orbis, I would definitely encourage it. I think it’s a team of one still, although I don’t believe that because they’re making so much progress so fast, but I think that Orbis and CyberConnect are now talking about sharing the same data model, so your connections on one actually come with you to the other. This composability of data across Web3 is such a powerful part of this.

16:08 • Avi
I think that’s what has us really excited at Delphi Digital is the composability of that data and what that means. From a developer’s perspective, it’s almost a no-brainer. Why wouldn’t you build on top of these existing data structures and databases? Thinking of something like CyberConnect and the social graph…

16:34 • Danny
I love how you put that. Already we’ve seen people in week-long hackathons build pretty sophisticated Notion clones, because with decentralized data, you can get going so much faster, and that’s even without a huge ecosystem that we’re now starting to see built up of other developers who have published data models for profiles, or for a social graph, or for whatever else. When you think about the future developer experience, you kind of show up to this data ecosystem and you just pick and choose different data models to compose your app, the way that you like NPM install today for different libraries and features. Creating this open-source data ecosystem makes it so much easier to build cool things way faster, and way more powerfully, and that’s what we’re super excited about.

17:26 • Avi
I’m excited to see how developers run with this tool. I’m curious, though, on the user end of things, sometimes it’s not as explicit what these benefits are. Could you maybe walk me through how composable data structures end up manifesting a better end-user experience?

17:54 • Danny
There are things that are directly part of the experience and things that are a little bit more subtle. I think that the users are going to get it when they start going to applications, and all of a sudden, the applications are delivering incredible user experiences powered by all the data that they’ve had elsewhere without them having to go through a whole bunch of authentication screens to connect to an API. It’s just going to show up in an app.

18:23 • Danny
It’s going to have all of your preferences and the fact that you are already like dark mode and your whole contact list in it. and you’re going to know that it’s not creepy Meta or Facebook behind the scenes snooping on you. You’re going to know that that app has it just because you brought all your data with you, and they were able to use it and deliver this “holy shit” experience, similar to how a lot of us responded to DeFi – like it didn’t do that much when we heard people describe the power of DeFi Legos, but when we went from Zerion to Zapper.fi and saw all the same stuff but just in a different interface and in different tooling, it kind of clicked: “Oh, you can do so much more now.”

19:01 • Danny
I think it’s going to be similar, but for a huge number of other use cases, e.g. bringing your conversations across these different applications, or like I choose to use Notion you choose to use Evernote, but we can still collaborate on the same underlying document but we like different products. That’s the real UX benefit that users get, and then they also get to know that they have control over all their data. There’s no lock-in. There’s no abuse of their data, and we know that most users aren’t going to take a ton of action against that today anyway, but more and more of the sentiment against that is huge, and the real hidden cost of that is when apps have all of your data locked in, you can’t adopt new products or services nearly as readily.

19:50 • Danny
You have to wait until there’s a huge reason to migrate everything over. With composable data, users get to know that anytime another better/complementary product or service comes out, it’s super easy to just go start using that. The real user experience benefit is how we use the web as a whole, not just how we use any one application.

20:12 • Avi
If I could just auto default dark mode on every site that would be huge.

20:18 • Danny
It was a community member who brought up that example, and it’s such a basic one, but it’s so true. Why do you have to toggle that on everywhere? That should just come with you.

20:27 • Avi
Totally. I’m excited for that one. On that sort of data user ownership piece, I think right now it’s like a black box. There’s an agreement when you sign up for an application to allow an application to use your data, but users never actually own it. I think that’s maybe the fundamental difference here, and maybe you could just elaborate on that piece a bit more. How is it that Ceramic is actually enabling users to truly own their data?

21:15 • Danny
Technically, within Ceramic, we have these pieces of data called streams, and streams are these IPLD DAGs, so these mutable data structures on top of IPFS. What that basically means is it’s a piece of data that can change over time as someone or some party writes updates to it. Every stream has what’s called a controller which you can think of as the owner of that stream which is basically the key that’s allowed to make updates to that piece of data. That controller in Ceramic most of the time is a user’s DID, which is called a decentralized identifier, which basically maps to a bunch of different blockchain accounts.

22:10 • Danny
As a user, you’re actually signing every piece of data/every change that’s made/every new piece of data that’s written to Ceramic is being signed by your key, either directly or indirectly. That stream cannot be updated by anyone else, by any other application or user. It’s written into the code of the stream. First of all, it gives a kind of verifiability over the authenticity and provenance of the data for anybody and any application, but any of those streams can be encrypted or access controlled in different ways, and it’s the controller who gets to decide who gets to read or decrypt it, and the streams are being stored on a decentralized network that anybody can run a node.

23:02 • Danny
There’s no one party that decides to keep pinning the data or hosting it. It’s being processed by anybody who wants to, as with other decentralized networks, so what this means is the user is directly writing the data onto the network, unlike in a traditional database, where maybe you do something but it’s actually the application that’s writing the data on your behalf. So you’re directly writing the data with your cryptographic signature onto it, and you’re the only one who has the permission to update it, share it, change it, or give others permission to access it in different ways. Similar to value and smart contracts on a blockchain and signing transactions with your blockchain wallet to send crypto, you’re directly controlling this crypto data on Ceramic in a way that cryptographically and provably only the controller or the user of it is allowed to.

23:55 • Avi
Could I keep any of that data private? I’m thinking that if I’m a user and I’m storing it on this public network that anybody can see it. Why is that any better than the applications who are holding it to themselves? If Facebook wanted to, they could come to Ceramic and just pull all of my user data. How do I end up being able to control it? How do I know and make sure that it’s mine?

24:32 • Danny
I think there are two different pieces. There’s the privacy, and then there’s the control or power over the data, and they’re very interlaced, but we can actually tease them apart. The privacy story on Ceramic is basically some data that can be public. That data is available for anybody to see, i.e. your public profile, if you want people to be able to discover a little bit of information about you. Most people have a LinkedIn profile and they don’t mind that anybody on the web can go search for their LinkedIn profile and find it, so there is information that people are fine with having public. It’s all your decision to put it there.

25:13 • Danny
Then there’s encrypted data on Ceramic. This is data that is still on a public network, but it’s encrypted, and only the controller/the user can decide to let others decrypt it and see it. That’s great for things where you want some level of privacy and control over, but it’s still a public network, and encryption may be broken at some point. Someone could be downloading the whole public network and waiting till the day that they can break all that encryption, so we wouldn’t recommend you put your social security number or your genetic sequence on Ceramic ever, even encrypted, but what you can do is you could store a bunch of data that you want much more secure privacy guarantees around. That shouldn’t go on a public network, but that should go on to a server with very strict access control rules.

26:09 • Danny
You could index it or put the fact that it’s on a server an endpoint somewhere with the schema of what’s there on Ceramic attached to your identity in what’s called a dig* data store. This is like the user-centric user table that you mentioned before, where it lets any app discover what data the user has and then go route to it. That routing can point to databases that are just servers somewhere, so you get the benefits of this user-centric discovery and composability and control without actually putting all the data on Ceramic. That’s kind of the degrees of privacy using Ceramic. Even for the public discoverable data, what’s so different than the story in Web2 is everybody’s on a level playing field.

27:04 • Danny
Your data might be public or encrypted, but as a user, you know you can always take it with you. You always have the option to opt-out and go somewhere else. As apps, you know you’re always kind of building on this shared data infrastructure, which is very different than, again, Facebook, having a massive amount of data about everyone. That gives it this massive advantage where no one can kind of opt-out of the network effects, because they’re so powerful, and competition can’t innovate and compete on product or service alone because they’re competing against this huge advantage Facebook has. It’s partly a privacy story, but it’s also a leveling of the playing field to unleash a lot more permissionless innovation on the data that we should all be sharing access to.

27:50 • Avi
That’s awesome. There’s a very hyped narrative that we’ve seen at least on the Delphi Venture side of things around the metaverse and interoperability in the metaverse and what does that mean. Of course, I don’t even want to call it Meta, but the company formerly known as Facebook, making that move into the metaverse and owning this full stack of user data is kind of terrifying. I’ve got my Oculus here that I love and adore playing, but I also want the best game developers to be able to produce these incredible experiences.

28:34 • Avi
I want to be able to bring my data from place to place, so I’m really excited to see how Ceramic plays into that. That being said, Ceramic is kind of blowing up the data business model of Web2. What do you think that next generation of say Web3 social business models looks like? How do these companies end up making money if they aren’t able to capture value on their users’ data?

29:13 • Danny
I think it’s much more diversified business models that align the incentives of early app developers and modern mature businesses and users together much better. First of all, there are ways that certain data on Ceramic could actually turn into revenue streams. Ceramic will eventually have a blockchain. There will be a native token that is used for a number of different things in the Ceramic ecosystem, one of which is to create and curate the data models that I mentioned earlier; data models being these kind of defined schema and structures for data for a social graph or for blog posts or for a composition of these other data models.

30:02 • Danny
By having a marketplace around staking on them, apps can signal this is the one we want to use, and you have this really powerful consensus on data, which really increases the interoperability of data on the network which makes all the data and the information a much more valuable and consumable – good for everybody. The apps and developers and users who are helping to create those data models signal on them or create the data that kind of forms these data collections in these data models get consumed, could be rewarded by the token. There could be really powerful revenue models on top of Ceramic for creating data, sharing data, signaling on data.

30:46 • Danny
That’s kind of the closest analogue which I think is much more incentive aligned, but that’s the closest analogue to monetizing data that we have in Web2. I think that the really exciting thing about having all this data and other infrastructure in a decentralized space, of course including blockchain, is the startup cost of building really powerful applications falls so much because you’re able to skip past so many of the cold start problems and the initial hurdles of getting an application into users hands. The most obvious one is that most early applications have massive fall off during onboarding, especially if they’re social, because you show up to an app early and none of your friends are there, or they don’t have any data about you then they can’t deliver a very powerful experience compared to something that you’ve been using for a long time and all your friends are there.

31:41 • Danny
Every app can share your friends list and all this data about you because you can bring it from app to app. It’s way faster, cheaper, and lighter weight for people to build businesses online, e.g. to build apps, products, and services. We’re seeing the return of people who are willing to pay for applications again. A couple of years ago, I didn’t pay for any software on a monthly basis. Now I pay for all sorts of things. I think we’re moving from a model where every piece of software needs to go for being a unicorn and capturing all this data about users and tries to be huge to a much more rich ecosystem of diverse apps and services that all interoperate and play together really well. They might not be as big, but there will be lots of profitable ones that together are way more powerful than anything we have today.

32:31 • Avi
That’s cool. I haven’t thought about that one before. I too am much more willing to spend money on a software product. I’m curious, in the same kind of train of thought around the financialization of data, I’ve heard in Web3 that people will own their data so they can sell their data and people will be able to make money from their data. What’s your take on that?

32:55 • Danny
I won’t disagree that it is possible or that it will even happen. It might. I think that’s such a small part of the value that we’ll see once users are in control of their data, so that’s not something that we’re focused on at all. There are different studies and research and calculations about how much your data is worth. Some say it’s worth a decent amount. Others say actually, individually, your data is not worth all that much. It needs to be pooled. There are ways to pool it, and that can happen.

33:25 • Danny
Think about a world in which all this data is with users, and people are able to bring it from app to app. Data has gone from scarce to abundant. Facebook can make so much money off of users’ data because they’re the only ones that have it or one of very few. They can charge advertisers a ton of money to be able to target ads really well because they have that unique resource of tons of data. In a world in which there’s this massive ecosystem of data where you just get to bring it with you wherever you want and choose to let lots of people have it, data is much more abundant. In some ways, the value actually falls, which means people are making a ton of money off of you, but the real value you get as a user is, again, apps and products and services can deliver way more value to you way more cheaply. Sometimes that might take a financial form, like you can get a huge discount on your life insurance premium if you connect your Fitbit to your life insurance provider because now they can see that you’re healthy and you’re working out.

34:29 • Danny
Your premiums can go down if they can verify that. That’s worth it because it’s 1000s of dollars, so people will jump through hoops to create this custom integration, but imagine if everything works like that, like just by signing a message in your wallet and giving access, and now you get a huge discount because people can verify that you have a high reputation or that you’re a really good customer or whatever it is. You can get lots of discounts or lots of value-added features or just a better experience for less. For us, the value is much less explicit than just selling your data to the highest bidder. It’s much more about getting more value out of this information that should be a shared resource.

35:15 • Avi
Nice. That makes a lot of sense. So we’ve chatted a bunch about data, like Web3 data and decentralized data. I want to zoom out a bit. Since this is part Delphi’s Web3 Series, I want to ask you: what is Web3?

35:40 • Danny
I think Web3 is the internet in which all of the apps and products and services you use across all of your different devices with all of your different accounts share underlying data, whether that’s financial data on a blockchain or user data or application data. One thing really interesting that we talked about on our team is, in a lot of ways, the vision for the metaverse and the vision for Web3 have merged recently. The Metaverse comes at it from a kind of interface angle; VR, of course, but I think everybody understands the metaverse to be more than just VR. It’s really about the omnichannel, access anything with devices connected, and living in this digital world that’s not just web pages on a laptop.

36:31 • Danny
Web3 is a vision in which Meta the company is not in control of it, or Google or Amazon is not in control of it, but rather, it’s a rich ecosystem of sites that all interoperate and work together and are powerful through their diversity and through their composability, but the metaverse has to run on some underlying infrastructure, among that is what we are calling the dataverse. That dataverse needs to be shared by all of us. The Web3 that we’re excited about is one that is just billions of flowers blooming, people creating apps and services constantly that just plug into this ecosystem, which is how the web started. That was the original vision for the web, but because it was missing a few pieces it got co-opted along the way by a few giants.

37:27 • Avi
I love that – the dataverse. I think we’ve heard a lot about the metaverse, and frankly, Meta kind of took that spark away from me at least, and I’m sure for others, and then Web3 is such an ambiguous term. As we were coming up with this Delphi Podcast, we were thinking of names, and somebody mentioned, “What would it tell listeners if we call the podcast, ‘What is Web2?’” What does that even mean, like the internet? Everything? That’s what we’re trying to do here, right? We’re trying to unpack these different pieces, and I think you come in from a really interesting angle of this unified data layer or data infrastructure, and obviouslyCeramic is a big piece of that. I’m curious, what other data infrastructure components or layers are you keen on?

38:34 • Danny
I do think we’re seeing the kind of emergence of a Web3 data stack. I think the base layer was built very heavily on IPFS. Filecoin and Arweave give this really powerful long term storage that Ceramic will use and rely on, and I compared Ceramic earlier to be kind of like this database layer on top of raw file storage, but one thing that is really important complement to Ceramic’s write functionality is…

39:13 • Danny
…Really powerful querying: the ability to read data across the dataverse, whether that’s on a blockchain or on Ceramic or elsewhere. The Graph and other indexing services are super important to be able to take all this data, which instead of being neatly in a server at an AWS farm in Virginia, it’s in the dataverse with data scattered everywhere; it’s decentralized, and that has a whole bunch of implications. Beyond just physically, it’s logically decentralized. If you have your data and I have my data, for having a conversation in a feed, that needs to be recompiled together for a good application. Really powerful indexing and querying are important.

39:55 • Danny
The Graph is a super important part of the Web3 stack, and then one of the biggest challenges is going to be creating and managing all of this data in a friendly user experience that is still secure and lets users make the right decisions and access this data anywhere but without it being overwhelming. The wallet and authentication layer is really important. Ceramic is kind of a layer beneath this with a really powerful identity system (that we didn’t talk about that much) that basically lets you connect any different blockchain wallet and account on any different blockchain to the same identity, so you have this interoperability that’s not fragmented by key. That requires really great wallets on all of these different blockchains and beyond blockchains too to manage the signatures, the permissions, and the data.

40:53 • Danny
I think lots of people are doing great work on that. The sign-in with Ethereum standard is very exciting to sort of standardize some things there. We’re seeing some more things on other chains. Then there’s a bunch of business-building services and products that bring all these together to make it much easier for developers to onboard because we’re still early. Compared to building with AWS, it’s still hard, so folks like Figment putting together a hub for developers to come to use all of these different pieces in a really easy so that the theory and the promise of it being so easy to start building an application becomes more of a reality because it can be challenging to try to piece together all these different protocols that are very low level if your dapp is new to the spaze. The last one I’ll mention is you asked about the privacy on Ceramic, and again, not all data should be stored on an open network. There are folks like Textile or Spruce that are building more private data solutions that don’t have the same public state network but are great for other kinds of data. We work really closely with them.

42:05 • Avi
Nice. There’s a whole bunch of alpha there. I’ve got a full reading list now for this weekend. What’s the catch here, though? This sounds undeniably like the future, and I think it is inevitable, but right now, we’re in the early stages. What are the trade-offs right now for something Ceramic?

42:37 • Danny
It’s a good question. The first one is performance; it’s not as fast as a server right now. We actually think that there are ways in which it might be in the future. It’s not inevitable that a decentralized network, the way that Ceramic is built with like local first writing needs to be any slower than a centralized network, but it’s really fast for certain use cases today. We’re still relatively early, and it’s optimized for some use cases and not others. In addition to the data models that I talked about earlier, where apps can kind of structure their data according to certain schema, Ceramic streams, which are actually the data objects themselves, can be programmed to represent different types of data and different rules about how data gets managed and changed and conflicts are resolved and stored, and there’s two right now on the network.

43:32 • Danny
Long term, there can be a huge number more that basically allow for different use cases in a much more optimized fashion. If you’re doing a super scale social application right now, Ceramic is going to have some performance limitations. That’s really the biggest one is just targeting the use case to what Ceramic does quite well. The other thing is Ceramic right now is a peer-to-peer network, which means there’s no built-in incentive. There’s no built-in guarantee for data availability. Anyone who wants to build on Ceramic today runs their own node. We’re working with a bunch of great commercial infrastructure partners who are going to start to offer nodes as a service, so that similar to paying AWS, you could pay someone else to run a Ceramic node for you.

44:17 • Danny
Long term, there will be a blockchain, and it will look very different than any existing blockchain because it will be optimized for data rather than for value. Tons of trade-offs are made very differently to get way more scale and way more speed than you could ever get on a traditional blockchain because you can forgive certain limitations that are necessary for financial transactions that you don’t have for data transactions. That will provide a guaranteed availability for data, but in the meantime, there is still the need to run a node or pay someone else to. That kind of developer experience in the full flow isn’t there yet, but it will be soon.

45:03 • Avi
Gotcha. You kind of hinted at bringing on commercial partners who can help ease the friction in terms of running a node. I’m curious, what does the future of Ceramic look like? Maybe let’s look a year out from now, and then also, five years out from now.

45:26 • Danny
A year out from now, I think we will have the *knock-on-wood*, and don’t hold me to this, at least not until our CTO blesses it too, but we’ll have an early version of the Ceramic blockchain that will start to provide some of the guarantees that the long-term network will. What you’ll have at that point is this the combination of this peer-to-peer network that has scaled much faster and far beyond where we’re at today, with hundreds of applications using it to write, manage, and build with decentralized data, and then an early blockchain that’s starting to provide guarantees around that data beyond the peer-to-peer system.

46:15 • Danny
Right now most of the development is happening by 3Box Labs. That’s going to change very soon. We’ll have more development partners, and we’ll also have a full development ecosystem that we’ll share more about pretty soon, so really giving the community ways to participate in this and start to take ownership of it as well. That’s a year from now. I think we’ll have a couple of use cases that are dominating Web3 at that point. Today, most reputation in Web3 three is you recognize someone’s ENS handle, but that’s kind of it. I think people start to have really rich reputations of these credentials they’ve earned of verifications they have from Web2, maybe imports from Web2. We’re starting to see that happen a lot: bring all your data with you. I’m talking to lots of people in both NFT and DeFi world about the need for various forms of reputation to do more sophisticated financial transactions, but also DAOs especially need all kinds of reputation to manage governance.

47:22 • Danny
I think we’re going see the start of not just Twitter clones or things that kind of replicate Web2 in Web3, what I think of as the skeuomorphic phase of Web3, but things that you could only do in Web3, which I think sharing data across applications, sharing conversations, sharing media. We’re going start to see all of that by the end of the year on Ceramic. In five years, it’s hard to imagine what will come out in terms of concrete applications at that point, but I think if you’re a new startup, building a new application or product five years from now, you’d be crazy not to use a decentralized stack. The data ecosystem, both data models and structures to start building on, but also the data you get to use with users bringing data with them, will be so powerful that if you’re starting a new company, new business, new product, you’re going do it on decentralized architecture as opposed to a more traditional centralized one.

48:29 • Avi
Awesome. The future’s bright with Ceramic in it. I got to ask, when token? When can I ape into Ceramic?

48:37 • Danny
We’ll check in in 2026 and see how that’s going. We don’t answer that question – not yet, at least.

48:44 • Avi
I had to ask. I know myself and everybody else listening is probably curious. This was a blast. There’s a lot of awesome information here. I learned a bunch, and I’m sure our listeners have too. Where can people learn more about Ceramic and 3Box Labs?

49:07 • Danny
Start with Ceramic.network. That’s our site. There should be a brand new documentation and developer page and experience going up right around the time this launches. There’s lots of good technical information there and @ceramicnetwork on Twitter. If you want to learn more about the company, we are of course hiring across the board for roles that are super exciting and impactful. We’re at @3Boxlabs on Twitter and 3BoxLabs.com. If you want to reach out to me, I’m @dazuck on Twitter. If you want to come to say hi and hang out, chat.ceramic.network is our Discord community. We do all of our work in there, build in public. The community is incredible and building at a pace I can’t keep up with. Our core devs are in there all the time too, so if you want to start hacking on something or building check out chat.ceremanic.network.

50:04 • Avi
Well, Danny, this was a pleasure, appreciate you hopping on. We’ll talk soon. Thank you.

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