More about the protocol and less the crypto ?

Michael Revy
7 min readAug 27, 2021


A paraphrased decentralized finance (Defi) speech given to a centralized finance (CeFi) technology forum

Centralized solutions to money and commerce

Beware dinner parties with central bankers (CBs) interested in DeFi and bitcoin. I was at such an occasion and afterwards got invited/challenged to give a speech about what I was doing in the crypto space.

I should mention that the invite was not just from anybody, but the Swiss National Bank technology forum. I am honored and pleased central bankers are listening to all sorts of new technology ideas. Even fringe ideas like my own.

Here is some of what I said.

Why speak to Cefi about Defi ?

Ideas are central, their implementation/generation can be decentral. As many Swiss are polyglot, I mentioned that language is sufficiently central to understand, but changes in a decentralized way.

It is the best time to be a central bank. There are armies of people working on traditional banking issues. I stole this slide to show the magnitude of innovation in DeFi land

OK, so that’s nice, but what is the problem and motivation for crypto?

A few slides later I offered a summary of the current solution to too much centralized trust.

These three items resulting from Nakamoto’s paper in 2008 offer a powerful paradigm to developments in blockchain, DeFi and web3.0. I think the circular, virtuous element married to decentralized models will have profound implications for commerce, banking and governance.

But, my humble objective in DeFi is to get more commercial use on to blockchains.

A protocol I am working on is for claims. My framework for ‘money’ is a claims ledger. People did things for each other and kept track. I do something for you with the loose agreement that then you do something for me. This is more formally represented by medieval tally sticks.

The idea was to mark on two tally sticks (yours and a collaborator — two sources of truth) that you had done some job. Your tally mark on both sticks meant that your friend was next to do similar work. A tally stick could be traded — if people knew the signatures on the stick and what sort of jobs had been performed. (not scalable)

There are two other base monetary systems. These are commodity (gold) and public physical ledgers — like Rai stones. These two and other ‘hybrid’ systems I consider more advanced and come into question later in the story.

So, let’s get back to tally sticks. It is my contention tallying comes first and that later agreement on some money becomes the remedy for swapping or ‘monetizing’ tally sticks -as in you may not know the quality of work represented on a particular tally stick — but you can have a generalized idea of the market price for work (a tally) after we agree on a money.

As economies grew, people needed to forget ‘swapping tally sticks’ and simply use an agreed upon money as proof of work. Curiously, we have all been decentralized ‘miners’ proving work way before internet p2p consensus protocols and forms of money.

Well, that is all interesting, but why is there more yield farming and liquidity providing in crypto land than actual commerce?

In my view, the blockchain is a record of work performed. I see it as the final part to a commercial system.

It is not the genesis.

I introduced my suffering audience to the accounting journal token (AJT). An AJT is the most simple component of the Bulla protocol. This token can be thought of as a tally stick where tallies are marked in some crypto and signed by a particular wallet. Upon validation, an AJT performs what people call ‘triple entry’ accounting where the final step is wallet to wallet crypto payment. Wallet to wallet digital payment via p2p was impossible during the renaissance double entry accounting era but just imagine da Vinci as a front end developer.

I found an older tool of commerce. A Bulla.

Bulla from the Medieval Latin for “a round seal” is an inscribed clay or soft metal or bitumen or wax token used in commercial an legal documentation as a form of authentication and for tamper-proofing whatever is attached to it or contained in it. — Wikipedia

The Bulla above was used in ancient times as a collection for claims — and signed by some authority.

I had created AJTs — why not allow these to be collected in some sort of signed ‘envelope’?

Below is a schema for a Bulla token created by the Bulla protocol.

The journal group is the purpose of the Bulla. The created Bulla token would enable membership to participate in this purpose. This type of Bulla collects claims related to the stated Bulla purpose generated or mediated by members.

A journal entry claim is a complex form of accounting journal token (AJT). It would be a one to many claims subledger made against the corresponding Bulla and by extension, it’s members.

Web3.0 has transformed the idea of a protocol to new ‘FAT’ protocols like Uniswap, Chainlink or Bulla(?). Web2.0 client server protocols are ‘thin’ as they link to fewer, trusted and centralized servers than p2p and it’s many trusted endpoints.

The Bulla protocol can specifically mint Bullas (signed by an owner) to collect signed digital claims related to a purpose.

The protocol can also generally track ‘uncollected or non minted Bulla attached’ AJTs of a wallet in a sort of natural, implied or global Bulla.

Web3.0 architecture has a dual or mirrored nature. A simple payment in blockchain is one to one and becomes the mirrored object between endpoints. If we introduce a claim token between wallets then they share a public, token on-chain. Much like my BTC payment is now your BTC balance. My receivable is your payable.

I can view my receivables and payables by signature (the ‘natural’ Bulla) or by ‘purpose’ Bulla as described above or by both natural and purposed Bullas combined.

I mention all the above to provoke a question. Where is ‘the bank’ ? Blockchains are inherently ‘bankless’ and are directly collaborative.

The mirrored nature of blockchains and the Bulla protocol yields a collaborative , decentralized finance browser of the net ‘work’ value for a wallet on the blockchain.

A global bulla banking dashboard for a wallet on xDai chain

A final element to a blockchain architecture is the model it uses to self perpetuate. This model is stakeholder capitalist. The larger protocols being developed in web3.0 embrace this idea. Either a new chain needs mining for it’s native token — or a new consumer/investment protocol may be managed by a decentralized, autonomous organization (DAO). This DAO will compensate and incentivize users to use and improve their related protocol by offering participatory DAO tokens.

Bulla protocol will be governed by a DAO. The hope is to tap into the stakeholder capitalist idea that Nakamoto himself promoted with bitcoin.

I came back to fat protocols. A claim is an abstraction. UniSwap is an abstraction. Heck, finance is an abstraction. These abstractions may settle in ‘money’ one day, but their tokenized abstraction can allow for customization to a/our purpose.

From a central authority point of view, a protocol could be more useful to influence than simply regulating crypto or creating central digital currency.

Why bring protocols and DAOs up in a speech to central bankers? I have the following slide :

A CB decentralized organization would become quite a topic. A CBDAO could influence other major protocols and open governance of it’s own actions to stakeholders. A central bank might want to add functionalities to any protocol (like Bulla). It might want to introduce a few protocols of it’s own.

Perhaps it is not just about the crypto!?

Like so many Webex presentations, it ended with me having no idea if the audience had expired or not.

I got a few good questions.

The test will be if I get invited back to another CeFi dinner party. I will keep you posted.



Michael Revy