# Full Text: Systems Modeling and Cognitive Audits for Hypercert Ecosystems

> Extracted from `2022_HypercertEcosystems.pdf`

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As submitted, October 2022
Email ActiveInference@gmail.com with comments or questions
Systems Modeling and Cognitive
Audits for Hypercert Ecosystems
Active Inference Institute (https://www.activeinference.org/)
Problem and solution
●
On August 24th 2022, Holke Brammer of Protocol Labs released a blog
“Hypercerts: A new primitive for public goods funding” describing how “Hypercerts”
could be used for Decentralized Science (DeSci).
●
With collaborators at the Active Inference Institute, we have been developing
frameworks and tools for applied Active Inference, in the context of Remote Teams
& DeSci, specifically highlighting the intersection of Active Inference and Systems
Engineering as realized in our open source package Active Blockference.
●
Our 2022 DeSci paper introduced an Active Entity Ontology for Science (AEOS),
which describes how entities of different types develop and interact within and
across system scales (e.g. two people communicating, within a DAO that scaffolds
scientific peer review, that is paid via funding from a research agency).
●
We aim to develop the Hypercert ecosystem towards flexibility, utility, and
maturity by creating an AEOS specification, and Active Blockference
implementation, for Hypercerts.
●
We aim to develop the tooling, use cases (case studies), and educational resources
that enable a cognitive audit of Hypercert protocols. The addition of this cognitive
layer into the Hypercert development stack will facilitate trust and reliability, thus
maximizing the value of projects.
●
This AEOS implementation would enable anticipatory design and realtime analysis
of Hypercert ecosystems, at the granularity required for high-reliability systems
design. Such an implementation may build on intuition, by demonstrating areas
where Hypercerts may be superior to other funding mechanisms, as well as areas
where it may not be effective.
We can consider the Problem being addressed, in terms of some of the limitations of
current practice in two areas: 1) How funding is done today in DeSci, and 2) How DeSci
systems design is done:
1. How is funding done today in DeSci:
a.
Funding is accomplished (that is, where it is accomplished) by various
uncoordinated modalities including: self-funding, selling of speculative
fungible or non-fungible assets, philanthropy, research grants from legacy
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## Page 2

As submitted, October 2022
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institution, etc. — this is an area that the Hypercert (and Impact Certificate
concept more broadly) seeks to address.
b.
Hence we are interested in developing the rigor and efficacy of the Hypercert
concept, to increase the probability that it can be used successfully.
2. How DeSci systems design is done:
a.
Systems are often communicated with ad hoc flowcharts with
heterogeneous or partially-specified types of nodes and edges (informal
ontologies).
b.
Systems are often communicated and coordinated via blog posts, social
media, conferences (no standard means of communication).
c.
Lack of shared standards for communication and versioning on systems
design (lack of engineering-grade standards)
d. Systems design is often at the level of populations, or types, of things. This
may be too coarse-grained to deal with the kind of data which exists in Web2
and Web3 ecosystems - these data can describe single specific actions,
taken by particular entities. We suggest that agent-based methods are
essential to move design considerations from the bulk or mean-field
approach, towards the granularity which design & realtime analysis demand
(lack of entity-based modeling)
Related work
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We have been interested to apply Active Inference to the setting of Web3, DeFi, and
Decentralized Science (DeSci) for some time now, resulting in our paper from March
2022: “An Active Inference Ontology for Decentralized Science: from Situated
Sensemaking to the Epistemic Commons“. In this paper we provided an overview
and contextualization of Decentralized Science, and introduced the AEOS framework
which this grant will develop upon.
●
We are working closely with the cadCAD development team, and using their
platform BlockScienceLabs. Additionally we are connected/collaborating with
several relevant groups in Web3 (such as Kernel Community), the DeSci space such
as OpSci (via project participants Jakub and Shady).
●
Currently, Active Blockference simulates the cognitive processes and goal-directed
behavior of a single-agent. Our goal is to expand this simulation into a multi-agent
model, in order to explore the cognition and behavior of Hypercert ecosystems. As a
multi-agent simulation, Active Blockference would facilitate the rigorous analysis of
consensus protocols and Web3 communities prior to deployment. It can serve as a
sandbox where we explore cognitive, micro-economic, behavioral, and
decision-making processes.
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## Page 3

As submitted, October 2022
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Relation to PL’s research activities
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As of August 2022, the blog post described that “We want to build the foundations
for hypercerts and support 3+ impact economies in the next 12 months” - so we
believe that this project and grant are within the temporal and attentional window of
Protocol Labs.
○
In terms of active research groups at Protocol Labs, wherever the Hypercerts
are being developed, would be relevant. Perhaps this is with the
CryptoEconLab, Cryptonet, Network Good, Network Research, or Research
Acceleration areas.
●
Adapting the Hypercert concept to an Active Inference entity ontology will provide a
direct link to the work done on AEOS and create affordances for computational
models of systems using Hypercerts as their funding mechanism.
●
Whatever the final NFT specification of the Hypercert, holistic consideration of the
Hypercert ecosystem will require systematic and rigorous cognitive modeling (e.g.
Priors, Preferences, Expectations, Affordances), integrated with state of the art
tokenomic simulations (e.g. with cadCAD).
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The creation of a formal ontology partitioning the system in question into entity
types, affordances, and system dynamics is clearly advantageous over
coarse-grained structural descriptions of a novel system without clear definitions of
its subparts or any link to simulations, real-world applications, and other research
initiatives in the space.
Impact
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We aim to provide a rigorous analysis of various Hypercert-related funding
mechanisms and how they may be used by both existing and emerging communities
along with a set of tools for creating entity diagrams and develop simulations
tailored to the needs of the researcher. Many communities in the Web3 space are
increasingly interested in formalizing their approach to community-design, token
engineering, and overall value creation, so these open source tools would be
impactful and relevant.
●
Having an entity-based modeling and representation of Hypercert ecosystems,
could have various benefits such as: Regulatory compliance, evaluation of proposed
and actual designs, prevention of various kinds of system abuse and failure.
Research Strategy
●
As Hypercerts are in active development at Protocol Labs and beyond, with multiple
concurrent teams, we do not have a completely-specified research strategy.
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As submitted, October 2022
Email ActiveInference@gmail.com with comments or questions
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We will initially engage in a series of informative interviews with Protocol Labs and
Hypercert developers, and stakeholders, to understand the landscape which we will
be then developing in.
●
Following this stage of informative interviews, we will pursue the following
development Milestones.
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Note: all Milestone Deliverables, Budgets, and Descriptions are tentative. We are
open to further discussions with Protocol Labs, to hone this proposal into a form that
is most preferable for you.
Milestones
Milestone 1: Entity Model Construction
Date: Within 4 months of funding beginning.
Budget: $20,000
Deliverables:
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Active Blockference models for the relevant Hypercert ecosystem active entities
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Active Blockference models for the relevant Hypercert ecosystem informational
entities
Milestone 2: Ecosystem Composability Functionality
Date: From 3-6 months after funding beginning
Budget: $20,000
Deliverables:
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Active Blockference templates and constructors for Hypercert ecosystems
Milestone 3: Ecosystem Composability Functionality
Date: From 5-10 months after funding beginning
Budget: $20,000
Deliverables:
●
Composable, executable simulations (e.g. design studio, or SCADA-like) for
Hypercert ecosystems (can be novel/plausible systems, or case studies / digital
twins).
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## Page 5

As submitted, October 2022
Email ActiveInference@gmail.com with comments or questions
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Compose comparable simulations of traditional, DeSci, and Hypercert funding
models that demonstrate advantages and opportunities for improvement for
Hypercerts.
​
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What are the risks of our Research Strategy?
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There is no certainty that the development of an entity ontology for systems using
hypercerts will yield results in favor of the hypercert mechanism.
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Hypercert markets in and of themselves, may present secondary risks, for example
related to cascading market effects, and psychological/social effects of this kind of
financialization of research.
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*Extraction method: pymupdf*