The Infinite Machine by Camila Russo

Author:Camila Russo
Language: eng
Format: epub
Publisher: HarperCollins
Published: 2020-07-13T16:00:00+00:00

18

The First Dapps

Funds were running out and leadership was in turmoil, but the first green shoots were budding in the Ethereum garden. People were starting to build their own applications on the platform, just like Vitalik had dreamt.

Joey Krug, an Illinois native, learned to code on the Apple II his dad got him on eBay when he was ten. In what felt like a natural transition from programming and playing computer games in all his free time, he also started mining Bitcoin. He saw it as a way to essentially make free money using just his desktop computer. He moved to Southern California to study computer science at Pomona College in 2013 but dropped out a year later to build a Bitcoin business.

Next he moved to San Francisco and rented a basement. Frustrated with the idea that Bitcoin was just digital gold, he joined efforts to build applications on top of the Bitcoin protocol. As is usual with crypto projects, he came together with like-minded coders scattered all over the globe but brought together on the internet. He came across academic papers that talked about decentralized prediction markets but found that nobody had tried to implement them. Joey loved that he could potentially build a parallel financial system where anyone could create derivatives contracts on essentially anything—from speculations on the price of gold to who would win the US presidential election. Unlike past centralized experiments, these couldn’t be shut down. Jack Peterson, who was working on his own blockchain startup and whom Joey had met in a chat group online, was excited by the same idea. They decided to go for it together and called their project Augur. It would be one of the first decentralized applications built on Ethereum. These so-called dapps, which would later proliferate, are programs that use blockchain technology to reduce the inefficiencies of centralization and/or to avoid third-party censorship.

But they started out building Augur on Bitcoin, and it was a challenge. The protocol has a limited scripting language and so they had to build custom functionality for everything they wanted to do. They eventually realized it was just not possible to build on top of Bitcoin itself, and that it would have to be a whole separate chain. Joey had read the Ethereum white paper a year earlier, in 2013, but back then, he didn’t understand why you would need a blockchain that supported smart contracts. Tired of struggling, he finally took Vitalik’s advice and switched his attention to building his dapp on Ethereum. They were able to build on Ethereum in twenty-four hours what had taken them over two months to build on Bitcoin. This was still before the network had even launched, and the only people using it were core developers and a few other enthusiasts like themselves.

They released a test version in 2015, a couple of months before Ethereum’s Frontier mainnet launch. Augur works with its own internal token called Reputation, or REP. Users can place bets on future events—for example, will

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