 What I want to talk about today is why we need to fix patents now. There's basically seven points. Progress proceeds at the rate of science and technology innovation. This is a critical century. We need safe, fast and efficient progress. Innovation, broadly defined as research and development, is greatly rate limited by incentive systems. CryptoEcon enables planetary scale changes. These systems are a key worldwide innovation incentive system that we should be thinking about fixing. Given that it's there, we should be one of the candidate things that we could do is try and fix that system. And therefore we need a program to try and fix patents now. I'll finish with some potential ideas and directions of how to get started. And it's been really great to follow all the discussions today. I think it's been phenomenal to get all the ideas out and it just reinforces the whole point of why we need these kinds of discussions. So I want to start talking about science and technology. Science is a process of knowledge expansion. It's our systemized way of refining the meme graph, extending what we know. And over time we turned that science and that knowledge into technologies. Embodied knowledge has rearranged matter to extend our capabilities. Sometimes it's not matter. Sometimes technologies include systems and programs and so on. By the end of the day there's some interplay between these two things where on the one hand we're expanding what we know and over time we're translating that increasing knowledge into an expansion of tooling which we then reinforce back into expanding what we know and so on. And this basic process, which is really one thing, it's an integrated system, it's not really two things, is behind the last million years of progress or so. Including that music. So a million years ago there were no such things and now there are such things. And science and technology really yielded this. In the last few centuries we've had an enormous amount of global improvement and you can look at many factors of the human condition and you can see there's just broad improvement that it lags behind the innovations in what we know, the expansion of our knowledge and the acceleration of that knowledge into systems and technologies that are made broadly accessible. So by changing the system by which we know more things or the systems by which we translate what we know into how we can use our knowledge to improve our capabilities we can more or less fix any problem and improve the human condition broadly. And there's all kinds of measures of this and so on and so we're used to seeing the kind of waves of innovations and all kinds of diagrams that show the compounding acceleration of inventions and whatnot. This kind of innovation process of going from basic research into developing and refining devices to then broadly deploy them and so on is a lengthy process that involves many fields, involves many groups, many different ways of working, many different fields of knowledge. It's highly integrative and I think we're going to all agree here it's not going nearly as fast as it could go and it's certainly not nearly as assisted by technology as it could be. Also there's an important thing to like here like the number of inventions and the number of papers describing new knowledge or patents and so on is reaching a level that no human or even groups of humans could be ever expected to handle without broadly enhanced capabilities through computing and so we're kind of like at a point where we just kind of can't deal with the amount of natural language PDFs out there and so this is really past the point of now using AI systems to be able to deal with this and if we're going to go in that route and incentivize the thing and build better structures. One really important piece here is that ideas whether it's basic fundamental concepts or refinement of ideas into devices and so on, really coupling networks and going back to that know-how discussion once people or groups explore a certain region of the space they tend to kind of generate lots and lots and lots of very small ideas that are sometimes critical to making something work and we don't really have a good way to explore this massive knowledge graph and we don't have a good way of mapping that knowledge graph to who has that knowledge or how that knowledge is embodied into things or how to learn that knowledge and whatnot and we don't have good incentive structures and we'll get to this in a moment for how to drive the generation of more of this knowledge and the generation of more explanatory material to learn this knowledge and the exploration of devices or kind of incremental knowledge to get to something that can be broadly used. So this is a critical century. I think even though things have been getting tremendously better we're now confronted with a kind of ridiculous list of ex-risks this kind of also ridiculous face transition of humanity and our macro systems are pretty much inadequate to be able to handle these kinds of risks. The climate crisis is a good example of like how poorly our macro systems can deal with something of this scale and so we're kind of left with the conclusion that we basically have to use a different process or a different set of systems to try and have change at this scale. You can use what's there but changing the macro system in these timelines is kind of fraught. It could happen but it's very difficult. One really good news is that the internet really enables this massively compounding platform for the diffusion of new superpowers, the scale up of those superpowers and the optimization of systems. It's kind of amazing the degree of engineering and analysis and optimization that goes into extremely basic things at this point, the level of engineering and optimization going into just our phones or like the hard drives and computers or SSDs is in some measures dramatically more complex than all the engineering we've put into the patent system. So when you think about like spinning drives or like solid state memories or something like that, it involves extremely difficult engineering and somehow we've managed to organize the planet to mass produce these things, constantly be innovating on them and improving them and diffusing that innovation and that's hardware let alone how we're doing the systems that we're building of that kind of scale and complexity entirely in the software space. So we should be able to design and improve and diffuse and scale up better systems, especially if they're only software that can kind of fix our incentive system around knowledge generation and the translation of that knowledge into devices and technologies that we can use. It's also like useful that today the macroeconomic systems sort of recognize the value of how ideas and knowledge have transformed the economy and these days most of the value-generating corporations and so on tend to be in the purely ideas or purely software or purely intangible assets type of value creation, which was sort of predicted many decades before and sort of eventually happened. Now the good news in all of this is that in the last, thanks to the last 30 years of computing and installation but really sort of like the last 10-15 of blockchain system deployment we now have an extremely powerful set of tools where we can bring mechanism design to bear on the problem. Before blockchains you could design mechanisms but the way to deploy them into the world was by convincing a lot of people by appealing to the legal system by designing contracts and instruments and eventually kind of getting those things into government which was great in kind of pre-computing timelines like that was a great way to innovate before you had computers but now that you have computers you can really innovate at a totally different time scale and a different level of skill ability and so that's where bringing like the new law is mechanism design and if you can use mechanism design to shift and create a new patent framework or a new innovation incentive system you can speed up this transition. One important component here is that I urge everyone thinking about a list to think about this in terms of part of the topia which is a whole set of concepts that I won't go deep into it right now but the broad idea is that when you consider the potential like when you look back in history and you see the improvement over time and the compounding improvement over time and all the benefits that have come from that and you kind of think about the future and project that out most of the value creation in the future greatly eclipses the value generation today and so it is just in everybody's best interest to try and collaborate as much as possible to not compete or create conflict and to try and kind of vault into that future as quickly, safely and efficiently as we can and the good news is we can use crypto economics as a way to navigate the landscape and get there so innovation from my perspective innovation is greatly rate limited by incentive systems a lot of us here admire Bell Labs as one of the kind of quintessential places where innovation just happened extremely predictably at great speed and kind of in an astounding set of like creativity and generativity and so on and so it was really an amazing kind of as this figure describes high-level invention this is kind of a map that David put together of the process of going from going across stages in the R&D pipeline that Bell Labs built and so it gives you a perspective of how long innovation took in that place and bear in mind that this was way faster than the rest of the world at the time but this should put into perspective how across this large time scale you're dealing with lots and lots and lots of researchers and developers and engineers and so on that are involved in many different parts of the process one thing that I would like to think about here is that there's a qualitatively different thing that happens before and after discovery so before discovery you have a lot of different groups exploring potential problems and potential solutions and you can sort of count those numbers of groups and so on and think about how to incentivize those groups and to try and get to some invention but once they do the refinement of that core concept into something that can be broadly used and that can enhance capabilities the number of groups downstream of that greatly eclipses the number of groups before so you can think of this divergent discovery process where you kind of try and figure out what you know which is kind of how academia is functioning today and then once you have a fundamental conceptual discovery that is broadly recognized as a big deal invention like say a transistor you have the prototype transistor in front of you and it does the thing going from there to you have a miniaturized thing that you can put into a product that requires hundreds of thousands of other researchers and engineers and developers and so on to put into action and so the bulk of the invention process actually is downstream of the fundamental discovery even though for most of history we've kind of like learned to greatly value those really big leaps because they do kind of create something fundamentally different it's really the bulk of the innovation work is downstream of that and that's the part that we're not incentivizing well so I've come to kind of think of this as this chasm in between science and technology where you basically have two broad fields of incentives operating in the technology side you have broad markets and this today this is mostly corporations writing this maybe in the 50s it was governments but today it's corporations they tend to try and maximize cash flows they sort of rely on the public markets to do their thing they're working relatively well of course the room for improvement but once you have a thing that's close to a product you can scale it on the other side in the science part you have a field that it's based on academic credit that really prioritizes those conceptual discoveries but it doesn't prioritize any of that kind of refinement of an improvement of processes in the middle so you end up with a good incentive to produce like really new fundamental conceptual discoveries but no strong incentive to actually translate any of that knowledge into devices that can expand technology or that can expand our capabilities so you have this like broad problem in the R&D translation process is not well incentivized and there isn't a good mechanism here the kind of like litmus test for this is just walk into any VC office today like the craziest, most like futuristic thinking VC that you can find on the planet and talk to them about how you're going to refine some process, some hardware thing that is like a 10 year out time scale like they'll be like hey, it sounds great come back to me once you're like within 3 years of having a product weird exceptions exist but basically if anyone is managing other people's money they can't actually invest in you so we're missing this kind of effective coordination system to bridge this and traditionally this is where patents came in they try to generate an instrument to create a way of hooking this part of the chasm into the broad economy but it doesn't work I'll touch on it a little bit later but this area I think if we can find way better ways to coordinate large groups of people and organizations and to kind of do this process faster then we can solve most of the problems that we have so I would argue this is the core loop if we optimize this loop we can solve anything else and so incentive structures are a good way of doing this they're not the only way but they're a really good way I didn't think about this in terms of a long pipeline with all kinds of individual artifacts produced along the way whether it's an idea or a potential discovery or an actual discovery or that know-how it really is a very very large network and bundle of knowledge and whether it's conceptual or about refinement of a thing and then eventually this translates into things that you can put into products and eventually sell them into a market and to then get the cash flow to be able to fund the rest of the operation that second part is like the adapter to the 20th century and 21st century economy you may not need that in a different economy but that's an exercise left for future civilizations so I think today you could we could use mechanism design to change this pipeline to broadly accelerate the science and technology diffusion but it's going to require deep exploration of new kinds of incentive structures to fit in there and that includes exploring the patent system a brief aside so I mentioned crypto economics and baritopian outcomes just diving into the details here what this really is about is exploring different kinds of programs and structures that you can deploy into the network to cause massive scale action and this is a tremendously powerful new set of tools I don't have time to go into detail but we've just gotten a taste of it in the falcon community by deploying basically one major incentive structure which is just a periodic reward for bringing storage power into the network and that single mechanism caused this enormous massive scale network to assemble out of the ether basically but in our case falcon I have a mixed perspective on patents for most of my life I've been very anti-patent I think that they're really toxic instruments that once you create them it's very difficult to undo and once you make that copyright, once it's there there's decades involved that's a very difficult imposition that you can place upon humanity and so on for a long time I sort of see it as a wrong turn in history that we made these things and I've always understood the point and the idea of why we want patents but they never quite seem to work to me and I think one of the key components is just the broken transaction cost so I think the model of how patents work just hasn't worked for a century or so and I think there are some domains where they do work but those are special cases I think the pharma example is more of a that instrument works in that environment because of how academia in bio works and how pharma works and they've co-evolved with the patent system into that complex and you could achieve that same kind of success without patents or with a different kind of instrument and so I think today what we need to think about is how could you create a new kind of structure for patents ideally using the existing legal structure because changing it is extremely difficult and extremely difficult and slow so ideally using the existing structure but to ideally turn it into a software-only system or primarily software system that brings the transaction cost down to close to zero where it should be as easy as renting a room in Airbnb so one of my favorite examples for changing transaction costs is Airbnb because think of the world before that marketplace existed and think of getting to a city that day and deciding that you're going to look at all of the rooms of the houses around you and try to pick the one you really want across a wide variety of features and pay somebody to stay in their home and just the idea that you can now have a software tool that allows you to do that to really browse through everybody's rooms pick one and book it and be done and go up and stay there it's kind of wild compared to where we were before and what that really was about was taking a look at existing assets and existing potential transactions and refining the transaction cost it's creating a primarily by the invention of a marketplace so they didn't really have to create a new instrument you could use the existing payment rails you could use the existing structures and so on but all you really had to do was create a marketplace a different kind of transaction and to do a lot of upfront uploading of information to make that marketplace work so this includes the photos the reviews, the iterated game of deploying good reviews to make sure that all the feedback optimizes the system to produce a really good result and so I think things love that nature, marketplaces different ways of selling the instrument of creating a preemptive agreement to not litigated at all or creating bounds in terms of cost could change the landscape of patents completely without having to require any policy shift shifts could be useful but they're just in general pretty difficult so I think we need kind of exploration of all these kinds of structures so anyway I think we need a program to fix patents and I think we need to fix patents now because we need to solve these planetary scale problems quickly and efficiently and safely and so I think like I'm very hesitant to describe programs because sometimes you try and give people a list of problems to go solve and then sometimes people show up and break your program and then yield a completely different trajectory than what you expected but sometimes they do work well and sometimes programs do succeed so I think I don't have a program to propose at the moment but I think in general what we should be doing is getting towards field building so gather and systematize the knowledge of what patents are, how do they work, how are they broken what could they be get a lot of people to dream up new structures and new ideas for how patents might work and then gather and empower people and organizations to explore the landscape and once we have some candidate solutions and we have like made sure that there are better structures and better assets and so on then at that point scale them and let them become a larger part of society and the economy and so on so yeah I think marketplace are a really good place to look let's explore how those work look at I think the NFT royalty is an idea that is like broadly underappreciated I think it's a very good idea to include in this a royalty component that is just automatic as part of a blockchain the trading volume of NFTs just gives us a glimpse into what's possible around IP I think that this is very very good and healthy for the IP world if we can make it into like a good and ethical system because I share all the same reservations that I've been expressed today about like these things are like toxic assets and you don't you want to be very careful if you make them and ideally you could create like royalty networks and royalty streams and royalty systems that can interlink all these things I think if we do this right like we could even create things like crypto powered ARPA systems and so on there's a broader effort around regenerative finance systems that this field could incubate in and eventually grow so I think things like Shelling Point and Funding New Commons are good places to explore this and I'll leave with an invitation to whoever wants to think about this there's a conference happening in two weeks or a quarter in a few weeks that you can submit some ideas for new conceptions of the problem new constructions, new marketplaces tell us why this won't work, break the program whatever or propose a program but we'd love to have you there and yeah I will finish by saying new ideas are here needed. Thank you