Consensus 2019 - Conference Notes
These are my notes from attending the Consensus 2019 conference in New York - there is a good chance that some of the notes I made are incorrect.
State of Blockchain
Alex Sunnarborg - Tetras Capital
Bitmex - 10 billion volume in 24 hours
Decentralized Finance (DeFi) has locked up >2% of ETH
Blockchain developer demand up 33x
Institutions views on digital assets
- 22% already cover them
- 40% open to including them in the next 5 years
- 47% have place in portfolios
From Digital Gold to Contract Theory: The Economics of Mainstream Adoption
Joshua Gans - Professor of Strategic Management, Rotman School of Management, Creative Destruction Lab
Oliver Hart - Andrew E. Furer Professor of Economics, Harvard University
Eric Maskin - Adams University Professor, Harvard University
David Yermack - Chairman, Finance Department, NYU Stern School of Business
Cathy Barrera - Founding Economist, Prysm Group (Moderator)
Bitcoin is not a currency on all accounts:
- Not a store of value
- Not enough liquidity
- Volatile
The definition of money may need to be reconsidered
Replacing government FIAT currency with public money
Needed to counter cyclical monetary policy - central banks control this
Crypto is not the most promising from an economic perspective
There has to be sufficient competition in markets
- Few sellers = monopoly power
We may need to supplement them with some form of mechanism design
Gave the example of the second price auction for mobile spectrum
- This was good where there was insufficient competition
- Winner paid the price of the second place entry
About 50% of economic activity happens within firms as using the markets is costly
Can use contracts instead of market however they tend to be long term and difficult to predict what could happen
Real world contracts are incomplete
Residual control rights matter - governance
Votes are important
- Voters decide how asset is to be used
Blockchain protocols
- Who gets to change them?
- How do you decide that?
Currently not seen much economic impact yet outside cryptocurrency
Need economic innovation - bring economists and technologists together
Need to accept some form of management of this
Smart contract = ideally automated, flexible enough not to think about it again
Lots of current economic thinking is stuck in theory
Mentioned the token reputation registry (Pocket?)
Contract leads to obligations which could lead to court
A dispute means reopening negotiations on the contract
Blockchain takes away individual’s power
Example of agreement to sell 75% of all shares - Blockchain is a more credible commitment
Another example was crowdfunding
Back to the second price auction and bid privacy
- People make bids
- Verify if highest and what the second bid was
- Don’t need to reveal the winners bid
Economic and market design is “fiddly”
Example of the way you pay at restaurants after you have received everything. This should fail according to the text book
Each model needs testing of incentives and bad actors
The DLT is a new way of keeping records - the first in 700 years
Tracking and visibility leads to better behaviour
- Gives people incentives to perform better
- The morale hazard problems
There are limits to these mechanisms
Need to recognise contracts have gaps - look at better ways to handle it
Cat and Mouse? Securing Digital Assets and the Future of Adoption
Tom Glocer - Executive Chair and Co-Founder, BlueVoyant LLC and Capitolis Inc
Nadav Zafrir - Co-founder and CEO Team8
Robert Hackett - Senior Writer, Fortune (Moderator)
Nadav Zafrir - was part of the Israeli equivalent of the NSA
Crypto currency could be the perfect crime - once you have the key and sign the ledger it’s game over
More recent crime is where the customer is the victim
Larger banks believe they can just be “fast followers” - see what the pioneers have done and learn from that - no need to be first
Banks are running small experiments - all about understanding and learning
Asked what they would consider/invest in:
- Conference organisers
- Security
- Efficiency, throughput and cost
- Scaling
- Environmental impact
What is broken today and what will be broken tomorrow?
Where is the pain and what technology solves it?
Nadav is head of a company called Curv
Multi-party computation - claims it can eliminate the use of public/private keys altogether
- Compute without exposing
Doing things off chain
- Done a deal with Munich Re - $50m per year person insurance
Hunt for trouble
Risk of single point of failure in Blockchain infrastructure
Connectedness has grown the potential attack surface exponentially
Trust - can we 100% trust our voting systems - very big dip in consumer trust in the process compared to the past
Fake news - technology moving quickly
One single point of failure - an asymmetric battle - flip it to make it need to attack multiple places (move it to the consumer end)
Morgan Stanley is spending $400m per year on cyber security every year!
Polkadot: Bjorn Wagner
Bjorn Wagner - Founder & CCO, Parity Technologies
Two main streams
- Smart contract platform (ETH)
- Application specific platform (BTC)
Consider
- Performance
- Security
- Sovereignty
- Flexibility
“Blockchain from scratch is really hard and expensive”
Introduced “Substrate” - an open source framework for building blockchain
Database layer, network layer, consensus engine, transaction queue, library of modules
Essentially a state transition function
Pluggable consensus, hot upgradeable, off chain workers/oracles
Polkadot = interoperable network layer
Making Blockchain Fun Again: Can Games Drive Mass Adoption?
Mickey Maher - Head of Revenue and Gaming Partnerships, Dapper Labs
David Pakman - Partner, Venrock
Jodee Rich - CEO, NFT.NYC and PeopleBrowsr
Brady Dale - Reporter, CoinDesk (Moderator)
Non-fungible tokens (NFT) - technology is currently pretty archaic. It is difficult to play and costly due to volatility
The value proposition to users is less obvious
Netflix addressed three of the biggest frustrations with TV
- No commercials
- On demand
- Binge watch and like shows
What gaming frustrations does Blockchain undo?
- Digital collectibles
- Items earned can be brought to market
- Achievements in one game can be brought to other games
Immediacy is currently letting down gamers
Users could build NFTs for use in a game and are transferable
Link between Gods on Chains and Cryptokitties - partnerships, holistic approach
The “kittyverse” currently has 50+ apps built on top of it, written by different parties
It became a platform where you could take an NFT and do something with it
Most valuable things in media
- World - like Game of Thrones, Star Wars
- Platform - like Facebook, Twitter
It is currently centralized - leads to an ecosystem of ways to monetize
Blockchain is a platform - it allows a bunch of actors to build worlds on top of it
Can we build the worlds?
Anyone can create the NFT and it is trusted - it was previously a closed environment
NFTs can interact - lock and key, puzzles - bringing them together can cause interaction (example of egg token and bacon token producing a breakfast token)
Described identity as a collection of NFTs
NFTs would provide liquidity and a way for teens to display tokens linked to things important to them - and trade them
Could also make some of them non-tradeable
An example would be that someone could use an endorsed NFT to show that they really were at a concert for example
An example of this currently is that attendees at MineCon get a cape for their character
Indies are usually successful first
There is no incentive currently for AAA games companies to change their model
Need to address the limitations of their current model. Want new entrants to have nothing to lose by innovating
One of the panelists viewed the current AAA gaming companies and social media networks as “the enemy”
The first step will be baby simple games
Free to play games are also the enemy of AAA gaming companies
We are starting to see linking in-game baseball to collectibles
You could trade unique moments of games - not just cards
NFTs don’t degrade = they stay mint forever
We need scalable blockchain with high frequency
Need “wallets” - a place to store and display them, a friendly marketplace and compelling experiences
One solution is to use Stellar for the high performance then at certain points move it to Ethereum
The killer app could be the interaction between the tokens
No Cutesy Cats: Tokens Come to Gaming and Betting
Theo Goodman - Chief of Memetics, Proofofwork
Jez San - Founder, FunFair Technologies
Rahul Sood - CEO, Unikrn
Leigh Cuen - Reporter, CoinDesk (Moderator)
Two of the panelists were from regulated gaming companies and one was not - this created a certain amount of friction at times
Rare Arts Festival - a rare Pepe was shown - this was before the NFT term arrived.
How to bring trust to gaming and make players feel safer?
- Currently have to give money to a casino and lose control of their money
- Ideally no custody of the money
eSports and betting on video games is a big opportunity. Can bet on your own skills or on other peoples.
eSports is taking over from traditional sports - it is the gateway drug to gambling!
This could introduce a high risk of cheating and throwing games
Possibility of KYC and ALM for gambling companies to connect to and “passport” to use on a selection of apps.
People scared of crypto due to lack of regulation. Regulatory clarity is key
Also not taking custody of the funds is key
Significant resistance to onboarding
- Lack of browser support for certain cryptocurrencies
- Crude wallets
Metamask only runs on 28% of browsers people are using
Issue with discoverability and accessibility of crypto - how do they get the coins and discover the platform?
User adoption - discoverability - exchanges to become platform for companies to become successful due to discoverability
Point of access for cash in and out
There is currently no really good argument for using crypto - it has too many steps and is still a bit too technical
It is hard to live bet on the current platforms due to latency - Unikrn supports up to 9k bets per second
FunFair are using Ethereum but using a secondary layer to achieve performance
Unikrn are using AI bots and vision for live betting odds on eGames
Quant Networks
Gilbert Verdian - CEO and founder, Quant Networks
- Blockchain projects currently take over 8 months and $3 million
- Overledger product is aimed to connect any blockchain to any other blockchain/DLT
- It is completely open and currently connects 10 different ones
- They started with the “Enterprise 5” and then went for the permissionless ones
- Claims it can be done with 3 lines of code
- It provides multi-chain apps, resilience, treaty contracts (even for those that don’t support smart contracts) and zero knowledge proofs
- Their CEO is the chair of the SG7 workgroup on “Interoperability of blockchain and DLT systems”
- They are part of Hyperledger Quilt
- Currently supports Java and Javascript
- Enterprise license is 30K
Zero-Knowledge Foundation: The State-of-the-Art in Zero Knowledge Proofs
Eran Tromer - Associate Research Scientist, Columbia University
SNARKS - Succinct Non-interactive ARgument of Knowledge
Exposes validity but not the reason
Common language between front and back end systems (R1CS language) - zkInterface
Permissioned verification
- Uses hashes/ciphertexts
- Trust in verifiers
- Extending the number of verifiers will reveal the past
Ring signature (obfuscation) (ByteCoin/old Monero)
- Add decoys
- Small anonymity set
- Linkability attacks
Confidential Transactions
- Specialized ZK proofs
- Hide transaction info (amount+type)
- Linkable
Other applications of zk-Snarks
- Smart contracts
- Scalability (with succinctness)
- Private asset tracking
- Media provenance authentication
- Identity attestation, business logic, asset provenance
- QA-based - fastest verification, widely used. Requires a public parameter
Had a mistake in his maths for the zk-Proof but wouldn’t impact as already superceded
Zcash sapling - dropped from 37s to 7s
PCP-based (STACK) - less efficient, not public
Fallbacks
- Updateable SRS
- SHARKS (hybrid verification)
Challenges
- Parameter setup
- Performance
Bitter Medicine: Blockchain and Pharma Supply Chains
Scott Mooney - Vice President of Distribution Operations, McKesson Corporation
Susan Somerville - CEO, Chronicled
Stefano Zanobini - Global Serialization Program Lead, UCB Pharma
Maria Palombini - Life Sciences Practice Lead, IEEE Standards Association (Moderator)
Areas of potential impact
- Shared master data
- Tracking medicine
- Eliminating fakes
- Verification of sales and returns
- Charge backs and contracts
- Supply chain - temperature control of cold chain products
Smart contracts with vendors, clinical studies - making release process easier
There is a bunch of data in a 2d barcode
Different approaches between EU and US
EU post data to a central hub and then cascade it down to national hubs
Can scan bottle and check whether it is valid - verified
- IMI blockchain working group (public private partnership)
US has track and trace model - point to point
Issue about transparency of data especially around distributors and keeping a competitive edge
Issue with full visibility upstream and downstream
One potential solution is only to allow visibility one step up and/or one step down but no more
Patient privacy
Pharma is very cautious about blockchain - need to start small
A purely public blockchain is not necessarily feasible - could potentially work in a private model
There are about 600-700 manufacturers, 20 distributors, 60k clinics, doctors, etc. at about 1000 entities
Players should be known and privacy should be paramount
Would need to cope with 30+ billion changes of ownership per year
Expect significant amounts of data off-block
McKesson handles about 42% of all transactions in the US
Most just care more about it working than how it works
“The money is in the data” - what can they do with it more than compliance?
Implementing rules on who can see what has taken a huge amount of time
Patient benefit - all they want to know is
- Did it follow the path it should have?
- Is it real and not counterfeit?
From Seed to Table: Live Projects in Food Provenance
David Cecchi - Sr. Director, Enterprise Data, Cargill
Ramesh Gopinath - Vice President, IBM Blockchain Solutions, IBM
Kimberley Harrington - Blockchain Strategy & Center of Excellence Leader, Bayer Crop Science
Mike Orcutt - Associate Editor, MIT Technology Review (Moderator)
- Provides a turnkey supply chain, end to end - from farm to processing/packaging to retailer to customer
- Providing customer transparency and efficiency
- However notice that it can introduce rigidity into the chain
- It can also involve tracking before the farm in the case of seeds - produced to product supply to growers to product that can be sold
- There are a lot of handoffs in the process
- Provenance can add value or open new markets
- It can be less error prone, more efficient and introduce consistency
- Biggest barrier to entry is user engagement - ideally provide the interface in an application they already know
- “Trusted information sharing” - make companies comfortable with sharing data
- Carrefour have tracking of chickens in Spain through to the customer - aids marketing, prevents fraud and helps sustainability
- Walmart use it for all greens suppliers
- Food suppliers can share info to reduce waste, increase freshness, progress faster through the chain for temperature sensitive products
- There are governance questions over what a company could do with the data once collected. Could Walmart sell it for example?
- Truly open blockchain means issues for business - DLTs may be better
- Blockchain is one of the smallest part of the technical solution
- “Imagine trying to deploy an ERP to your whole industry” - most issues are around business and conversations
From Menageries to Skyscrapers: Virtual World-Builders
Kim Cope - Head Product, Dapper Labs
Fede Molina - Head of Marketing, Decentraland
Brady Dale - Reporter, CoinDesk (Moderator)
- NFT - you own them. They are not the property of the developer
- This means you can take assets outside the original source
- Decentraland - has the concept of allowing others to build on the “land” you own
- Announced a link up between cryptokitties and decentraland to allow the kitties to inhabit parts of the land.
- Why would anyone buy land or cryptokitties at this point in time?
Betting on the Builders: Dev-Focused Investment Ideas
Avichal Garg - Managing Partner, Electric Capital
Tushar Jain - Managing Partner, Multicoin Capital
Dovey Wan - Speaker, Primitive Ventures
Josh Quittner - Editor in Chief, Decrypt (Moderator)
Current crypto markets are least efficient - professionals will come in and make them more professional and try to get bigger returns
Money is available for small groups adding value to the industry
VCs - give money, help governance and operations
Crypto unbundles these three
There was excess capital in the world and this led to a reinvention of best practices
VCs help with much more especially at the early stages as this is where extra help is needed whereas latter stages is more about capital
Traditional VCs are very regional and want dominance in ownership
Primitive Ventures
- Talent is a lagging indicator.
- They are looking for a founder who leads without authority and is just rebellious enough (lion and pirate, with high integrity)
MultiCoin Capital
- Timing - a lot of Web 2.0 companies failed but their ideas are now valid
- The order in which something is applied and adopted is important
- DeFi (Open finance) is an obvious focus in the short term including trustless derivatives
- Web 3 applications - consumers don’t care where it runs. No longer “safe” to build on Web 2.0
- State free money is long term - price of Bitcoin currently linked to geo-political tensions
Electric Capital
- Web 3 is not any time soon
- Programmable money - it is easy to approach the tech first
- Success is usually more niche/vertical than horizontal
Before the Pitch Deck: Building Relationships with Investors
Matthew Roszak - Chairman & Co-Founder, Bloq
Monica Desai - Investor, Kleiner Perkins
Rumi Morales - Partner, Outlier Ventures
Tanaya Macheel - Reporter, Cheddar (Moderator)
All about building rapport with founders and the team - storytell, breakdown barriers
Aim for good people running projects or surround with a good team
Always meet with the investor in person regardless of the cost
Read what the investors publish - research and culture. Look for things you can help them with
Relationships matter - they trust their networks - find someone in their network
Try and build these relationships before you need to raise money
It is a long journey so you need to know you can work with them
One of them hosted a “Blockchain supper club” - get interesting people together and see what happens
Read the culture
Higher responses can be achieved with emails in the style of tweets - keep it as short and concise as possible
Think about
- What have I not seen yet?
- What is the difference between yours and theirs?
Care about the relationship with the person and not the institution
If they say no, then always ask for referrals
NEO
Da Hongfei - Co-Founder, NEO
Trusted third party based computation -> verifiable proof based computation
- User owns data
- Applications are browserised (a view of the data)
- Infrastructure is decentralized and layered
Layers
- Application (Browser apps, dapps)
- Transaction (State channel, side chains, local ledgers)
- State and settlement (Global ledger)
- Content neutral network (network protocol/cloud services)
Components across layers
- Identity
- Distributed storage
- Oracle
Neo focussed on layer 1 and 2, also producing an identity, FS and oracle solutions.
Abstraction of assets, transaction and contracts (all assets are from smart contracts)
Everything will become a smart contract
Native support for layer 2
Optimize consensus mechanism (DBFT)
Improve the on chain governance
Incentivisation for people to vote
Adding Internet resource access -> url -> on to the blockchain
Introducing a manifest and permission system similar to what is used on mobile when apps ask for permission
“One of the most important things is the global community”
The release of version 3 will be a hard fork that will take 1 to 1.5 years to upgrade
Conversations About the Cloud: The Future of Enterprise Blockchains
Rahul Pathak - General Manager of Amazon Managed Blockchain, Athena, EMR, and DocumentDB, Amazon Web Services
Ian Allison - Reporter, CoinDesk (Moderator)
There are two use cases that Amazon is focussed on:
- Immutable transaction history with centralization
- DLT and decentralized trust
Aim is to make it easy to use Hyperledger Fabric and Ethereum (soon).
Support for other blockchains will be based on customer feedback
There are a bunch of use cases on the Amazon website - most currently focussed on Fabric
AWS solution adds monitoring and replacement
They have replaced Kafka in Fabric with their Quantum Ledger Database (QLDB) for ordering
Can use QLDB where decentralized trust is not an issue but gives cryptographic verifiability - technology they have used internally for years
Some customers were using blockchain just for the immutable ledger and didn’t need the rest
Focus on the customer and problems before technology
Example of an ad company - internally they used QLDB and a blockchain externally with partners
Interoperability will be important - possibly use checkpoints of private data onto a public blockchain where it can be verified
Most customers are interested in looking at both blockchain and QLDB
Differentiation may be the ability to extract data from the blockchain into reporting, storage and machine learning
Web 3 Track: Securely Connecting Smart Contracts to Off-chain Data and Events
Sergey Nazarov - CEO, Chainlink
- 80% of use cases need external resources
- Value of smart contracts is based on its weakest part
- Centralized oracles are a point of failure
- Chainlink handles data in from multiple sources to a process and then data out to multiple targets
- They are aiming to provide oracles for all EVM/Solidity powered networks
- Provide a marketplace for all smart contract inputs and outputs (building blocks) - basically wrappers around APIs
- Aiming to support all smart contracts by providing a level of abstraction above blockchains to allow switching
- Claim the most secure oracles by using “security in depth”
- They acquired TownCrier - a trusted environment for delivery of data (IC3 and Cornell developed)
- It protects computation from node operators
Future Fiat: The Question of Central Bank Digital Currencies
Tommaso Mancini Griffoli - Deputy Division Chief, International Monetary Fund
Daniel Heller - Research Associate, University College London, Centre for Blockchain Technologies
Kevin Werbach - Professor, Wharton School, University of Pennsylvania (Moderator)
Current approaches (cash and card) provide a good means of payment - immediate settlement
Central bank - mixes them together - immediate settlement, safe, make payments anywhere
Banks do normal payments and inter bank payments
Should bank notes be replaced with digital?
Can settlements be replaced with digital?
Paper bank note demand is declining
The fear for the cashless world is a payment system controlled by a few monopolies and the risks involved - for example, what happens if one withdraws from a region?
Emerging markets may be the key - financial inclusion and decreasing costs, difficulty in distributing physical cash
The current supply approach of cryptocurrencies makes it inferior wrt the 3 criteria of money
It is dangerous to think of issuing private cryptocurrency as just done
- No control over monetary policy - could be more complicated
- Regulation - how regulated they are, much less than government backed
IMF introduced an internal coin just for learning
It introduces a lot more steps to the process that it currently has now
Central banks view it as a Pandora’s box as they don’t know yet what they will find
A lot of them are investigating and running pilots
- Uruguay have run a pilot
- More possibly soon including China
There are lots of different designs and approaches.
Possibly won’t see central issued currency in 5 years but likely to be within 10 years
Expect some countries to make inter bank payments on-chain within 5 years
First Lap: The Contest to Put Trade Finance on a Blockchain
Gert Sylvest - Co-Founder, GM of Tradeshift Frontiers, Tradeshift
Ville Sointu - Head of Emerging Technologies, Nordea
Jason Kelley - GM, Blockchain Services, IBM
Nikhil Nayab - Global Head, Blockchain and Payments, Conduent
Emmanuelle Ganne - Senior Analyst, World Trade Organization
- 80% of international trade involves trade finance
- How do you incentivize participants?
- How do you create infrastructure for the exchange of value?
- A lot of EU SME trade relies on prepayment due to lack of tructh - introducing trust allows for new models around payment
- POC or POV often leads to POI (proof of incompetence)
- Customers don’t care that it is on the blockchain
- Plan for production and an open architecture
- Payments is a story of metadata - need to be able to move money but also explain what and why
- An invoice could be viewed as a smart contract that will execute in ‘n’ days time and due to the certainty of execution the “money is as good as mine”
- Need to focus less on the technology and more on the legal and social
Herding Cats: The Art of Building Enterprise Consortia
Brian Behlendorf - Executive Director, Hyperledger
Sebastien Henot - Manager of Business Innovation, Renault-Nissan-Mitsubishi Alliance
Susan Joseph - B3i North America Representative, Former B3i
Ajit Tripathi - Partner, Fintech, ConsenSys
Ian Allison - Reporter, CoinDesk (Moderator)
- IBM/Maersk was a governance faux pas
- Blockchain means they have no choice but to sit together
- Governance is the make or break. The technology is hard but the people is harder
- Putting together competitors in a consortium means they have to trust each other and they never did before
- Need alignment between the technology and the consortium by having the same incentives
- Network technology, like blockchain, needs networks - who do we play with?
- Some industries don’t have standards that will work on these new platforms so will be more difficult to make work
- Consortia don’t realise they are actually startups - they are a business but big participants don’t realise that the consortia is in effect a separate brand
Fiction Becoming Fact: Science Fiction and the Fate of Humanity
Ken Liu - Author
1956-1963 had a utopian view of the future - closer than we think
At the start of the 20th century cars were split between
- Electric - was superior
- Steam - was dominating
- Petrol - was inferior on both axes
The Texas oil discovery meant petrol has a huge boost to become the lowest operating cost. Add in the invention of the electric starter, the introduction of standards, steam taking too long to heat up and electric becoming comparatively more expensive and it may look inevitable that petrol won out
There is a tendency to understand everything as stories and effects
We create stories of how things came to be when in reality it is lots of teams competing to solve a problem and triumph is usually due to an unforeseen fortuitous event
This is the result of survivorship bias
Whatever prediction we make will be wrong - we cannot just extrapolate from the past
Pitches are just competing stories
Every feature can lead to multiple alternative realities
Don’t believe our stories as though they are the truth - it is a narrative
An example of this is the Internet - we could not have known all its uses in the future
Someone can be too close to something to see its extreme uses
Disruptive outsiders can move away from local maxima
We will go through multiple disruptions in the way we make our careers
Change and disruption is a constant
It doesn’t tell you what will come but teaches you to live with constant apocalypse
Byzantine Beliefs: Telling Stories About Money
Ken Liu - Author
Jimmy Song - Author - Programming Bitcoin, Blockchain Capital
Shannon Liao - Reporter, The Verge (Moderator)
- Stories impact how we think about the future
- Pick the story that resonates with your vision and then try and make it come true
- Byzantine Empathy is the Byzantine emperors problem but written as fiction
- Technical documentation is difficult but fiction can make it digestible
- Money is “stored labour” - go towards what we are best at
- What will happen when there is non-government oney and where will the value be stored?
- Fiat currency promotes a learned mindset
- If you have your own business you can put your labour towards what you are best at
- Crypto removes inefficiencies so we will have to go that way otherwise your competitors will benefit
- We resort to a central authority more and more which is dangerous to do
- A lot of blockchain stories are at all convincing - a lot are just rubbish databases - it is just a technology
- Deep vision will drive it
- Lots go with the story and not the source of truth
- Mentioned having multiple “symbol manipulation jobs” - move around and make more symbols
- There is a sense of aesthetics - some analogies between coding and writing - refactoring, back references
- Telling stories about the future gets others to think crazy thoughts
Scandalous Money and the Cryptocosm: A Conversation with George Gilder and Joseph Lubin
George Gilder - Chairman, George Gilder Fund Management, LLC
Joseph Lubin - Co-Founder, Ethereum; Founder, ConsenSys
Michael Casey - Chairman, Senior Advisor, CoinDesk (Moderator)
There are two great crises of the global economy
- Collapse of Internet security (security is due to the architecture)
- Scandal of money - including zero percent interest rates. Currency trading is the biggest industry on the Internet ($5.1 trillion per day, 25x world GDP)
Time remains scarce when everything is abundant
- Money is how we translate time into the economy
- Debt destroys the value of time
The solution to not having a stable Internet of value was to give everything away for “free”
Flip it like an exchange - take in your personal data and exchange for dollars for them
Could digitizing gold effectively make it a currency?
- Argument that the measuring stick cannot be within what is being measured
The mistake Satoshi made was that gold/time doesn’t effectively run out so the BTC cap was a mistake
Data and attention are potentially new currencies
Web 3 is a collection of decentralized processes
The main crisis in the US economy is the reduction in entrepreneurship
Nothing Important Happens Without Crashes: In Conversation with Brian Armstrong and Fred Wilson
Brian Armstrong - Chief Executive Officer & Co-Founder, Coinbase
Fred Wilson - Partner, Union Square Ventures
Paul Vigna - Reporter, The Wall Street Journal (Moderator)
- Every century economic cycles are disrupted by technology (maybe more frequently)
- It will always be a free market while switching charges are low
- Anyone can now make their own currency
- An example was given of an author issuing tokens for the book they are writing
- “When they wrote the spec for the Internet they forgot about money”
- We can now rethink the entire supply chain all the way back from the consumer to the producer
- Is Coinbase just a bank now with a digital skin?
- Gave the example of the earliest TVs - looking back now they looked like toys. Crypto is at that point now
- Niche areas are currently being adopted but not mainstream payments yet
- It is currently very hard for people to start to get into it
- Transaction times, security issues, cold storage at scale all need to be solved
- Nothing good happens without a bubble to finance it
- Coinbase - 70% exchange, 20% custody for institutions, 10% internal venture bets
- They are on their 4th generation of cold storage and they rebuild roughly every 18 months
- They perform a security test by using fake potential candidates in the office to see what gets exposed internally
- Trading and custody are different things - but can be done by the same company - or you may want your crypto in different places
- Token and venture funds will make up the first stage of institutional money
- Crypto networks will arise around core infrastructure resources - storage, compute, etc.
- Lots more “verbs” need to be supported
Where’s the Impact? Blockchains and Financial Inclusion
Anya Nova - Crypto Economist, Power Ledger
Clyde Vanel - Assembly Member, NYS Assembly, District 33
Vanessa Grellet - Executive Director, ConsenSys
Loretta Joseph - Blockchain Consultant, OECD (Moderator)
1.7 billion people don’t have access to basic financial processes
Usage goes to a credit score goes to access to money (credit) goes to ownership (land)
Blockchain is an excellent tool for fundraising - for example a solar farm - gives optionality, whether to take out investment money - can use asset backed tokens
Could also aid those who don’t get access in the most effective way
- Example of a solar installation on a building - residents split the cost but can cause issues over usage of the electricity
- Residents get tokens for their electricity that they can then trade if they don’t use it to other residents (market for shared resources)
- They can create their own market
Local banks interact with national banks - local don’t necessarily have/need a full license for all activities
Access to credit and financial activities changes lives and gives opportunities
“The pope gets blockchain”
- They are one of the biggest institutions that deals with refugees is looking to do tracking of refugee kids (lose 7% of them)
- Incentivize kids to be registered by giving tokens for food on the blockchain
Trying to disrupt credit ratings - build credit worthiness
- Issue with day workers being paid in cash and hence no history of employment or residence
Even in Africa and India “most people” have a phone which gives access to lots of solutions
Before talking about mobile access though they need electricity to charge them - it is a fundamental requirement
1 billion still have no access to electricity and 2+ billion with intermittent power
Need co-ownership of infrastructure
Could involve combining investment from different sources - institutional, crowdfunding, etc.
Potential New York State use cases
- Racing horses - tracking thoroughbreds
- Voting - prevent loss of voter records, up to date data, solve data silos (other areas knowing about deaths as an example)
Sierra Leone - voting means a digital id which means they can roll out land rights
It is not just helping the unbanked, it helps the financial services
More Than Just Numbers: Applying the Humanities and Social Sciences to Blockchains
Ann Brody - Blockchain Society Researcher, York University
Jason Windawi - PhD Candidate, Princeton University
Annaliese Milano - Social Anthropology PhD Student/ CoinDesk contributor, London School of Economics & Political Science
- Looking at just the things under a street light will limit what you see and they will all look the same way - need to look wider
- Williamson’s view - pick the approach that give the lowest transaction costs. It only considered governance as a structure - not processes
- Easy to adapt terms without understanding the underlying detail and concepts
- It is easy to aggregate data and miss the outliers - which could be important
- Social sciences can provide a bigger framework, identify blind spots and provide the context
- Think of things as relationships
- Sociology is very diverse, has a weak paradigm and reaches into lots of other disciplines - it tends to be more qualitative than quantitative
- There is currently a move fast, break things culture
- It can help take a more ethical path and learn from the past
- Engineers tend to be pessimistic/realistic
- Business tends to sell a tech utopianism
- There is a common ideology across the whole space
- Most dystopian things that could happen with blockchain could also happen without it
- Is there transparency if no-one sees it? How can we have a knowledge economy if only a few people can understand it? You can look at the source code but how many can actually understand it?
Industry 4.0: New Business Models for a New State of Play
Benjamin Beckmann - Senior Computer Scientist, GE Research
Paul Ulrich - Senior Policy Manager for Asia Pacific, GSM Association (GSMA)
Ron Resnick - Executive Director, Enterprise Ethereum Alliance (EEA)
Mike Jacobs - Senior Distinguished Engineer & VP of Engineering, Optum
Ian Allison - Reporter, CoinDesk (Moderator)
5G will be quicker, higher capacity, lower latency and kick off a massive IoT explosion
1000x increase of the density of connected devices per square kilometer
Privacy, rights to information and sharing will lead to a topsy turvy transition of data ownership and usage
With all the potential new business models - who survives?
Common interoperability language is needed for blockchain and will be a big block until it happens - it must include standards
Patients may be able to monetize their data for AI training
“Industrial Internet” - link to parts and supply chain - break from fully internal to external parties involvement
Korea used blockchain to hide IP addresses of IoT devices on 5G
Gaming - issue is attracting user as they have to use a multi-sided approach (devs, users, advertisers) - initially not going after money
There are claims that more users will increase the value of tokens that has been issued - economist is sceptical
Biggest opportunity is tokens - but it is not about speculation
Working on how to explain a token that is understandable and not tied to one technology
Need a universal language for describing tokens
- Look at the Enterprise Ethereum Alliance website announcement on tokens (also tokentaxonomy.org)
Just like we don’t talk about the background terms like HTTP and HTMP for the Internet, we won’t talk about the blockchain backend
Strictly Confidential: Why Blockchain Privacy Matters to the Enterprise
Daniel Buchner - Technical Product Lead for Decentralized Identity, Microsoft
Phillip Shoemaker - CEO and Executive Director, Identity.com
William Martino - Founder, CEO, Kadena
Brady Dale - Reporter, CoinDesk
There is a spectrum of privacy for people, organisations and things
Identity.com uses the device for storage - verified data and consent based
Microsoft Ion - had decentralized ids (dId) built by looking at standards - could give users more control over app data
- Stores keys and links to off-chain data
- Expect lots of these
- Can give out partial information
Self sovereign identity - you control it
Government issued ids are not self sovereign
External entities will make claims against the id
Data is going to become a liability due to privacy - it is going to be “radioactive” - something you want to lock down
You don’t trust people or organisations - you trust incentives
We may be able to use a non-Microsoft dId to login to Windows in future
Kadena is a hybrid
- PACT Turing incomplete
- Identity verification
- Scalable BFT/Chainweb PoW
- Runs Signals noise protocol
- Encrypted at rest (P2P or multipoint)
- Encrypted off-chain replication
Identity
- Bring validators, requester
- Stored attestations on Ethereum
Ion
- Standards based approach
- Ion is open sourced and runs on BTC
- Identity hub personal data centre
Money is a shared hallucination - a construct
BTC is all about lineage
All personally identifiable information is stored off the chain
An example of showing your id at a bar - you show a lot more information than what is required for the task
Identity/Civic requires a certain level of trust in terms of the KYC
There is currently no solution for the proof of data destruction
Most sensitive data should not be on chain - systems externally store data and then give an id for that data that can be stored on the chain