Unchained - Blockstack On Getting Independence From Google, Facebook And Amazon

Episode Date: September 5, 2017

Ryan Shea and Muneeb Ali, the cofounders of Blockstack, on how their tools enable users to control their own data, why the internet should have universal usernames but no company should control that, and why Blockstack’s storage system still allows users to choose centralized options  like Google Drive and Dropbox. They also talk about how other blockchain systems are thinking about scaling wrong, why they launched a developer fund, and why a developer would choose Blockstack over Ethereum. Show notes: http://www.forbes.com/sites/laurashin/2017/09/05/blockstack-on-how-to-take-control-from-google-facebook-and-amazon/ BlockStack: https://blockstack.org/ Learn more about your ad choices. Visit megaphone.fm/adchoices

Hi everyone. Welcome to Unchained, the podcast where we hear from innovators, pioneers, and thought leaders in the world of blockchain and cryptocurrency. I'm your host, Laura Shin, a senior editor at Forbes covering all things crypto. If you've been enjoying this podcast, please help get the word out about the show. Share it on Facebook, Twitter, or in your secret Slack and Telegram channels. And if you have a chance, give the show a rating or review on iTunes or wherever you listen to your podcasts. And don't forget, you can always tweet at me to let me know who you'd like to hear from in a few. future episode. My Twitter handle is Laura Shin. This week's episode is brought to you by OnRamp. Your branding and website are the first things your users will see. And in the current wild west of ICOs and blockchain startups, you need to stand out from the pack. OnRamp is a full service creative and design agency that will help amplify your brand with a perfect website, logo, collateral, or custom design project. Get big results in no time by visiting thinkonramp.com. My guests today are Ryan Shea and Manib Ali of Decentralized Internet Company Blockstack. Welcome, Ryan and Manib.

Thank you, Laura. Good to be here. So, Manib, can you tell me the story of how you and Ryan started working together? Yeah, Ryan and I, we basically met at the Computer Science Department at Princeton University. I was doing my PhD there, and Ryan was running the Entrepreneurship Club. And it was kind of funny how I would turn out to be the only grad students sitting in the meetings of the entrepreneurship club. And that's how we started getting to know each other. I personally knew that I'm not going to run for a faculty position because I wanted to go into startups. And so the team came first, and Ryan and I, we really wanted to work with each other.

So we started exploring a couple of ideas that we were really passionate about. And so Ryan, how did you guys come up with the idea? for the company that eventually became Blockstack? Yeah, I mean, as many have said, you know, we started with the team and we just started working together and we said, we're going to start exploring different topics and settle on a project that we're really both excited about, that we're passionate about a certain space and where we think there's a real viable business there. And we tried out a few different things.

And then at one point, we just were so frustrated with the state of the internet and the way that we as developers were so dependent on other businesses for the things that we really wanted to do. And also we thought of this from a perspective of us as consumers and how we were so restricted with a lot of the platforms that were dependent on like Facebook and Google and Amazon. and we actually, at that point, we said to ourselves that there had to be a better way, and there had to be a way that would allow consumers and developers to have a direct relationship with one another, in a way where users could own their data, and where anyone could just innovate permissionlessly. So at that point, we decided to go out and build a decentralized application platform, a decentralized internet. And from there, we boiled down the idea to one simple initial thing to build out. And that was a decentralized identity system.

And then from there, we launched the first version of one name and then started building out block stack into what it is today. Well, so let's unpack a lot of what you said there. So a lot of times when I interview people in the space, they say that they learned about about Bitcoin and blockchain, and then they came up with what their idea was after that. But it sort of sounds like you guys had a thesis about what was wrong with the internet before. And I know you guys have explained to me in depth kind of all the ways that you think that fundamentally the internet is broken.

Can you break down for readers what you think is wrong with the current internet and what problem it is that you're trying to solve? Yeah, absolutely. So I think if you look at the internet, the first thing is that all the users, they actually don't own any of their data. So let's say you want to use a website like Facebook, you would make an account on it, and you would end up all the data that you're generating. It's basically kept with Facebook and Facebook can use it however they want. Same with Google and a lot of other companies. So in a way, like all of the social graph that you have generated on a company like Facebook as well,

you can't really use it outside of that one company. And obviously there are certain ways where Facebook would try to make it easy, but again, it's a single company that is sitting on this data silo. So I understand that that is in theory something that's problematic. But when we look at it. at the way that people so easily sign their rights away to their privacy and their data. Even after something like the Edwards-Nodon revelations, people, you know, that made a lot of headlines at the time, but people sort of shrugged it off afterwards. And they continue to

just accept on every single privacy agreement or terms and conditions that comes their way. So do you think that this really is something that people care about and want to do differently? Yeah, I mean, I think it's really something that people care about. It's just, you know, there are certain realities that we have to live with. There's a lot of cases where consumers didn't really have an actionable path in front of them where they could say, okay, well, now I'm going to make a change to my life in order to take back my data. We're very much of the belief that we have to give consumers a real viable choice. We need to be able to give them a system where they can be in control of their data,

and at the same time do the things that they still want to do, right? So if that comes to switching from Facebook to something where you don't, a shoddy social network with a bad product where you don't have all your friends, well, yeah, no one's going to do that. So it's important to think about this from the perspective of how do we actually build the best products out there that can compete with products like Facebook and at the same time give users control of their data and privacy and security. and the way to do that is to make sure that users have that same experience

and we have this opportunity here where we can actually help bootstrap these early networks and allow users to have early utility. Otherwise, it's not going to happen. So I think it very much comes down to the realities of the choice. And it's not like I don't see it, like I said, in theory, that there's some kind of value proposition there, but I just wonder when you, you, in particular, if we're going to use the example of Facebook where they have so much momentum, they have so many users, how would you get people to switch to another version of

Facebook, a decentralized one where they have control of their data? Is it literally just saying, hey, it's the same thing, but you can control your data? Do you think that that's enough to get people to switch? Yeah. So where I was going with the Facebook analogy was that Facebook, the company, ended up building certain core infrastructure components. That should actually exist in a decentralized way in the internet itself. What are some examples? So one of the example is this having a universal username, for example. Like, you don't have a universal username on the internet,

the one you can use to basically just log into any app. And no single company should be in a monopoly position to have a, username system like that. And same with your social graph. Like if you think about how Larry and Sergey were able to write, you know, web crawlers and basically study how the web graph works, and they were able to innovate on top of that. Developers like Ryan and me today cannot do that on top of the social graph that Facebook has. Right. So the social graph in a way needs to be decentralized. And that would actually lead to a lot more innovation. on top of the system. And that was the core idea behind Blockstack initially. And as you mentioned,

that we started work on this before Blockchains. So we had a solution to implement a decentralized social graph without using blockchains. But blockchains actually make it a lot easier. And that's why we ended up using blockchains for this. So let's actually go back to that story because as you sort of hinted at, you started with something called one name and now you guys have switched to block stack. So tell me what it was that you started with and how you evolved into blockstack and how they're different. Yeah, I mean, so as Meneb said, really the, this is really born out of the ashes of our desire to give users and control of their data, their social graph, every piece of data they produce. And we saw this opportunity to build an identity system as the first layer

of this application platform, right? And we launched that initial product in March of 2014. It was actually one of the, potentially the first, like, real consumer-facing application that was like not just Bitcoin payments, where you could own something on top of the blockchain, like own your identity on the blockchain. So at the time when we came out with it, it was like a really, it was pretty groundbreaking. we saw, we got a lot of attention and interest on Reddit and from several publications. And when people came and they signed up, that was the first time that they could have a profile

and an identity that they owned with just their private key, just like they own their Bitcoin with just their private key. So we built that out, and we got thousands of users, tons of excitement. People were saying, oh, this is what blockchain apps are about. this is the promise. These are the things that we've been talking about and block stack showed us the way, right? And then we built that out.

We kept working on it. And we started building out the other layers of this blockchain application stack. So we started building out a storage layer. We were building on top of Namecoin at the time. And there were certain problems that we ran into. So we were also building out a more robust domain name system and discovery layer.

so that you could discover people and applications. And over time, we kept building these things out, and that led up to us with releasing our fully integrated developer platform for the identity, the storage, and the payments and everything. And we released this in a comprehensive package with the Blockstack browser. So that was really the path that we took to get here. And so when you talk about how you, you first released one name and how everybody was so excited about using identity as like a blockchain-based

identity and how they felt that that was a perfect use case for blockchain technology. Why is it that it hasn't really taken off yet? You have 70,000 users, 70,000 names registered on there, which, you know, given that it launched three years ago is obviously not a lot. What is kind of like, keeping it from being widely adopted? Yeah, I would say we have, you know, we've gotten some pretty interesting, interest and sign-ups from just the core initial identity products that we came out with, with one name.

But since then, we've shifted over to our full platform, right? we're still in the pre-consumer release phase with this new product. We're currently just releasing it to developers. Really, it's in a quiet, slow release. But we really expect that as we bring this out to the wider public, that we're going to have quite a bit of uptake in the signups, both on the user side and the developer side. I mean, we've already seen like so many developers.

building a time of Blockstack to date quietly just chugging along. You know, we came out with the $25 million signature fund recently, and we got over 100 applications from developers for building apps on our platform. So we've definitely seen tons and tons of growth on that front. And the user, the next phase for us with Blockstack and the Blockstack browser is to obviously do our token and then also to, come out with the consumer release of the Blockstack browser. How many developers do you have working on Blockstack right now?

Yeah, so our Open Source community is around like 5,000, 6,000 developers right now. And one thing that I think is important to understand is Blockstack is the open source technology and the platform. And that was there since the beginning. One name is just an app, right? It's like a GoDaddy registrar that we build up just to make it easy for people to register their domains or usernames on the platform. Right. And since then, the browser that Ryan mentioned, that's the direction that we are heading in where you download the browser and you register your username or domain yourself on the platform. So one name app is a very small component of the entire ecosystem.

And Blockstack has always been the main open source technology. So Ryan started to go into all the different things you guys are doing with the storage. And obviously you've got the names. And you talked a little bit about kind of the DNS system. So why don't we just dive into like what is Blockstack? I think a lot of people have already kind of this idea like, oh, Bitcoin is, know, peer-to-peer payments or digital cash, and Ethereum is this worldwide virtual machine. So how would you explain Blockstack to a layperson?

So you can think of Blockstack as a new decentralized internet, and the focus is really on the app developer development platform. So developers can actually build decentralized apps and publish it on this new decentralized internet, and users can actually very easily start using these decentralized apps. Yeah, and I would say that we've really been focused on the types of tools that developers will need and that all applications could use. So we're really trying to build all of the middleware between users and applications and make it really, really easy for developers to build anything from a social network to a marketplace

to something for healthcare data, to a voting system, et cetera, et cetera. So we've been really, I think, pragmatic in our approach there. And we've seen it really pay dividends with the applications that are getting built on Blockstack. So you guys keep using this word decentralized. But I also know that your system sort of works on this like two-tier layer, where there's both like a decentralized layer, but then also there's an aspect where users, or through the decentralized layer,

they can also access centralized services. Can you describe for me how that works and why you built it that way? I think with that you're referring to our storage system, Gaia, and it has the ability for users to kind of like plug in any cloud storage provider that they already use into the system. So we can repurpose existing cloud providers

and put encrypted data there and let users kind of like bring their own storage. But I would actually push back a little on the decentralization aspects of this system because I would argue that it's actually more decentralized than any individual decentralized storage system that you can think of because we can plug that storage system

into this broader, almost like a file system. So if you want to, for example, put your data on BitTorrent, you can with this approach as well. Or if you just want to put it on a combination of Dropbox and Google Drive, you have that option as well. So it gives you like high performance and more options for where your data is actually being stored. And why is that, it sounds like you're saying that it's higher performance than maybe maybe something that's totally decentralized, like Filecoin or SIA or something like that, is that kind of what you're implying there? And if so, why? So once you start getting into, like, decentralized storage systems,

a lot of the folks who are working on these problems these days are quite young, and they haven't been, like, there has been a long history of people attempting to solve these problems, like 10 years ago, 15 years ago, 20 years ago. And there are some common hard problems that are, you can say that any project that would succeed in this space would have to overcome. And those problems basically show their head once you would reach a certain scale. So it's almost like you don't notice them when you're small and you only notice them when your system actually starts getting real usage and rear performance. So our approach here has been that we've been engaging the, research community of like the first wave of peer-to-peer systems, people who are working in

this area in the 90s, like late 90s, early 2000. And we've been trying to learn from all of their lessons and building our system in a way that it can actually scale out and give you the kind of performance that people are used to when they use centralized services on the existing internet. And so then let's describe for the listeners exactly how it is decentralized then. because I think it's confusing to say to them, hey, you can still use Google Drive or Dropbox or whatever, because they're going to think, oh, well, then how is that decentralized? So describe how that works.

It's decentralized in a few different ways, right? So one is you have complete optionality. That means that you can bring any storage drive that you want. You can use Dropbox and Google Drive at the same time if you'd like, or you can use a self-hosted drive. Or as many have said, you could use BitTorrent. You can use IPFS. You can use SIA or storage.

You can use any of these things. You can use S3. You can choose which ones you want. You can easily migrate from one to another, and you can use multiple at the same time. That's a very, very important characteristic. That means it's completely under your control, and all of these storage providers are completely commoditized, right?

Second thing is that the data is signed and encrypted, right? So what that means is that anyone who has this data, any of these providers, they can't see the data, and they cannot manipulate the data, right? And because you have backups, that means that also deleting the data doesn't really do anything, right? Because that can always be restored from your local backup or from any of the other drives. So really, at the end of the day, what's important is that the user has the tools to take control of their data, and it is completely under their control. So it's essentially like bring your own storage.

And when you have that case, that's really as decentralized as you could possibly be, right? Because you can even as a user decide to put it into some other thing like IPFS and so on. And the important thing with, in terms of discovery, is that we're building off of a decentralized domain name system. So really, if you think about it, the most important characteristic of any de-centralized domain name system. decentralized system is the entry point. So if the initial discovery point is centralized, then that's a really bad system. It's not really decentralized. Now, if you have a initial discovery point that is completely decentralized, you can run that decentralized discovery layer over individual centralized components, and you will get all of the benefits of

decentralization. So it's a very important thing. So what does that mean exactly? That means that there's a private key system for your identity, which then unlocks the different centralized services. Is that how that works? I think one way to think about this is imagine that you're buying hard drives. So you can just go buy a hard drive and put your data on it in your own house. This is the system that we are encouraging. The users are paying for storage, and they can choose any place where they want to keep

their data, but it's their data and it's their hard drive where they're keeping the data. It could be a Linux server that they're running in their house, whatever they want. Most of the other models are basically trying to rely on their friends or random people on the internet that, hey, can you store like bits and pieces of my data on your computer, which historically has really bad performance and really bad reliability, because you can't trust that data to stay on someone else's computer without a proper reason. With Amex platinum, almost every purchase made with your card can be covered with points, including new tastes, new fits, and virtually everything in between. That's the powerful backing of Amex. Conditions apply.

Yeah, I mean, no one would say that hard drive storage is not, you know, user-owned enough or decentralized enough, because that's as user-owned as you can get. because there might be only four large manufacturers of hard drives in the world, but once you purchase a hard drive and it's yours and you're putting encrypted data on it, and all the users are doing that, then that's a very decentralized system. Yeah, I mean, an important thing to think about when you store your data is like it's either stored with you or it's stored on other people's computers, right? and if it's stored on other people's computers, then what's most important is that you have that data encrypted and signed

and that you have the ability to control how it can be synced and written and updated and all its other stuff. So that really is the important characteristic that we should think about with each of these stored systems, not whether we're using peer-to-peer networks or not. So basically, even if I store my data on Google Drive or on Dropbox, if I'm using block stack then you somehow it gets encrypted on those servers so even if Google Drive or Dropbox is somehow compromised my own data won't won't be is that how that works

yes that's correct yeah okay and another thing is you get an added benefit that there's also in a lot of these cases if you have data that's like let's say data that's encrypted and stored on BitTorrent, for example, that's still out in the public, right, even though it's encrypted. So there are concerns with using some of these peer-to-peer networks because it's going to get replicated many, many different times. It's not going to be able to be decrypted for now, at least, but maybe in the future there's some cryptographic break. And so having your data on a peer-to-peer network might not actually be that good of a thing. Let's pause here for a quick word from our fabulous sponsor, OnRamp. If you're starting up a new project or need some

design or branding help on an existing one, OnRamp has you covered. OnRamp is a full service creative agency that has helped numerous companies, including many in the crypto space, maximize their brand awareness, gain traction, and accelerate growth. OnRamp has a passion for ramping up brands and boosting business results and can help with everything from website and logo design to social and content strategy. Focus on your core technology and leave the rest to OnRamp. To learn more and see how they've helped passionate entrepreneurs achieve their dreams, go to Think OnRamp com. Thanks on ramp for being a supporter of this podcast and all of our listeners. So something else that I wanted to ask you about was scaling. I saw some of the, I wasn't able to attend,

sadly, but I did see some of the videos from the Blockstack Summit. And you talked about how existing blockchains are thinking about scaling in the wrong way. When are they getting wrong and how do you think blockchain should scale? Yeah, the summit was amazing. We miss you there. I think, like, obviously I'm biased, but I think it was probably one of the best events in this space. But the good news is all the videos are online, so I think you can check it out. Yeah, they've been great. I've really enjoyed the ones I've seen. Yeah.

So in terms of scaling, I think we can try to consider an analogy, right? Like, imagine that you think about a blockchain as a mainframe computer, right? and it starts getting more users. And you are hitting some sort of a scalability limit, and then you try to get more compute power or more memory for your mainframe. So you get a bigger mainframe. But it's still a single computer, and it can only process one thing at any given time.

So this is basically called scaling up, that you're just throwing more resources at something but it is still a single machine and you're bound by certain things in that design. And you compare that with scaling out, which means that you stop using this single machine for all of your computational or data storage needs, but you use it for some things which are very, very minimal,

and then you go off to other systems or other computers from there. So this is called scaling out, that you don't use the blockchain for every single thing. You don't use it as a general purpose computing platform like a world computer, but you use it for a very minimal task. Let's say I just want to discover what is the public key for Ryan, and then the rest of my application actually doesn't touch the blockchain at all. Or if I want to chat with Ryan,

that thing is completely outside of the blockchain, and our app can run that way. So this sort of goes back to what we were discussing about the different storage about how or how you guys manage storage where basically you use a decentralized layer to access different services, some of which might be centralized, and that enables people to get the benefits of a centralized system, which might be like greater speed or efficiency. Is that, is that the thinking? Yeah, I think it's similar that we, this is more just for scalability of blockchains, that,

there are obviously fundamental limitations for how much data you can put on a blockchain or how many transactions can be processed by a blockchain. So we are trying to put only the minimal amount of data and processing on a blockchain and basically move everything else out. But it goes hand in hand with having these decentralized storage systems as well. Okay. So now let's dive into the three main. areas of your system, which are identity storage and then payments or your token. So so far,

you know, we discussed before about how you've got 70,000 people who've got these block stack IDs. I also am one of those. So what can people do with their ID now and how does your identity solution compare with something like Civic or what like Microsoft's doing or NetKee or, you know, any of the other, there's so many of these blockchain-based identity projects out there. So tell me how yours compares. Yeah, sure. And I think this also builds off of the last discussion as well. A big part of our philosophy when it comes to applications is that the vast majority of

apps out there are database. They're not actually focused around financial instruments. If you look at things like social networks, Facebook, Twitter, et cetera, You look at marketplaces like Amazon, like Uber, like Airbnb. You look at tools, also marketplaces for advertisements like what we have with Facebook and with Google AdWords. And then you look at tools like search engines and so on. Their main fluid, if you will, in the application, is data. It isn't actually, it isn't money or derivatives or any of these other things.

it is actually data. And the important thing there, there's different types of data, there's data around, there's text data, there's social networking graph data, there's media data for audio files and videos and so on, like we see with YouTube and SoundCloud. And when we think about this, we should think about the fact that if the vast majority of the most successful businesses in the Internet today are centered around data, then there's likely going to be the same focus for a lot of the very large portion of the future decentralized applications that take off.

Another side of our philosophy is that most of the time when you think you need a smart contract, you probably don't. So in a lot of cases, it could be helpful for you to have tokens in your application, but something extremely simple. But you don't necessarily need the full expressibility of being able to build out an entire smart contract on the blockchain. We see a lot of these projects that are coming out and they're building their own identity smart contract right into their application, or they're building out their own smart contract for discovering data, for keeping registries and so on and so forth. A lot of these smart contracts really use the same components and they're re-implementing the same things. And they have tons of bugs and they're making the same mistakes. Right. So what we have done with Blockstack is we have said, okay, well, what are the core things that

decentralized applications need to succeed, right? What are those very simple components that we can build out and build it once and allow for a very heavy configurability, of course, and build out once for all of the decentralized applications to use, and make it really, really simple for developers to integrate in a comprehensive API and developer libraries. And so we've done that for identity. We've done that for storage. And in the future, we're going to do that for payments and tokens, right? And so that's why we look at these as the three pillars of block stack.

And underlying all of that is the discovery layer, the domain name system layer that maps names to keys to routing information. And that's really, you can think of that like a registry or a directory. for domains slash applications, for people, right, for, you can use it for IOT devices, for licenses, for really anything you want. So it's this universal discovery layer, registries, directories, for anything. And that allows- And that is something that would prevent websites from being hacked. Is that the effect that would have? Yeah, that's a component of it. Specifically, in order to prevent that, there are a couple things that we need to build out into our browser going forward to

the user additional context about the websites that they're visiting. But in essence, what it does is it gives applications complete control over their site and over their domain. And it gives the same thing for users. So to some extent, you can think of domain names. They are essentially yours. they're kind of under your control. Somewhat they're not because we do know that I can

and is an organization that manages the entire domain name system and Veracine is a single corporation that runs, for example, the dot com namespace and other namespaces. So there are levels of centralization there. But more on the side of users, there's not really any system where you can own a username and own an identity and have it completely under your control. So really the big, big benefit that we get from this kind of discovery layer is that it can act as the discovery layer for people.

And it can allow people to securely connect with one another and for people to securely connect with apps. So a great way to demonstrate why this is needed is if you look at apps like WhatsApp or Signal, right? If you ever look at these, what they try to do is they try to implement like end-to-end encryption. in a secure way, but it's not fully secure because at the end of the day, you still have to trust the signal registry to attest to the mappings of names, of people and phone numbers and keys, right?

And so if users aren't the masters of those mappings, then at the end of the day, you have to trust that central systems registry. And what these apps try to do is they'll say, like, hey, like this user changed its security number or AKA it's key. They'll try to warn you and things like that. But a lot of times users just blindly accept those warnings.

And they don't actually manually check the keys in another channel. We can't expect users to do that. That's a terrible user experience. So really what we have here is this universal security layer for people in applications. Everyone knows that they're talking to the right person. Everyone knows that they're visiting the right application. that's the goal. And so how do you ensure, like once I secure my block seg identity,

how is it that you keep it from being hacked? I mean, like, what if my private keys get stolen, then I can lose it that way, right? Yeah, exactly. So you can actually lose your key. So we can do a few things there. One, we can ensure that we have a multi-device model so that if you lose a single device and your keys are compromised in a single device, your account's still fine. You can still regain control your account. That's really important.

Your phone, your computer, we can use pairing there. The second thing that we're going to know with... So it's some kind of like multi-sick functionality? Is that... Okay. Okay. The second thing that we can do that we're going to go forward in the future with is allowing your network, your friends and family to help you secure your account. So that's something that's really important going forward. For example, you can say like, oh, I lost my account, and then you can go to your mom and dad, and maybe they can help you reset your account. We've got to make this really, really simple, great user experience, so it's super easy for everyone to use, and it's not confusing. And then the third thing is that even if someone, like, even if all of these systems fail,

and there's still a key compromise, then the user can unlink all of their other accounts on the internet. They can unlink their Twitter account, unlink their Facebook account, etc. And then people who look at your profile will be like, oh, wait a second, these identity proofs are no longer valid. Maybe this isn't the same person anymore. Maybe this person's account was compromised. So we can use other pieces of context all over the internet to still allow the user to recover from that key compromise scenario. But with all the other components in place, we can prevent that from happening for 99.99% of users on the internet. Wait, and so I can unlink from Twitter and Facebook?

Because what if somebody hacks my Twitter and unlinks my blockstack ID, then will other people start to suspect that my blockstack ID has been compromised? So I think it's basically you're kind of like distributing your risk. Let's say you have these proofs that you're posting on like Facebook or Twitter or your domain or GitHub, they are kind of like attestations that you're saying that I am the same person who also owns this Twitter handle, this Facebook account, this GitHub account, right? And the probability that all of your accounts get hacked at the same time is actually pretty low. So if you lose access to one of these accounts, you can actually... Unless your phone number is hijacked, in which case you could lose them all at once.

Sure, I think... Which is something that has been happening. a lot to people in our space, but anyway. Right. So I think then that really comes down to the security of your private key. And as Ryan was mentioning, that there could be very sophisticated ways in which you can actually save your private key. And that is your primary way of, that is, of owning your identity on the new internet. And I would also like to take a step back and differentiate between someone's private key getting hacked because of their fault, because they

got hacked versus you losing data or your passwords because some remote website got hacked, right? Because that happens more often these days. Because most of the times when you'd see, like, oh, Yahoo got hacked, and then everyone's passwords are now online, or this other site got hacked, and all of your data, all of your passwords, all of your private information is now online. That happens more often because these websites, they become like honeypots for data. and that's the thing that we're completely removing. There are no passwords. There is no private information that these remote servers or remote websites have on you.

And to hack a user, someone would have to go and hack that particular user. So if someone is targeting you, that doesn't mean that my information is at risk as well. So let's actually talk about your token. I know that previously you guys were not interested in having one. and in fact, maybe even a little bit somewhat against having one. So tell me how and why you guys changed your mind on this. I don't think that we changed our mind on this. I think we were just very careful about because the BlockSack system by definition

actually requires a token. There is a token even today. That token is Bitcoin. So it's more like I think we, when we saw a lot of projects, which were just raising money by putting a white paper on a website. Like that was a little bit alarming, just in general in the space, that these projects are, they haven't really built anything. They are just going ahead and raising money for the sake of raising money.

So I think maybe some of the earlier conversations we had with you were more along concerns for the general industry instead of the specifically, a token in the block side network. Yeah, I mean, also, you know, we've been, we've had plans for over a year now for building out, really building out the blockstack blockchain. And we've actually been, you know, solely over time, building up more and more components that allow Blockstack to be its own independent network. So, for example, the Atlas network, that's a really important component.

So Blockstack actually has its own peer-to-peer network for replicating routing information. it's unstructured, which allows it to be fully replicated, it allows it to be very reliable. So that's, and what does that mean exactly? That means making sure that when, if I go to like cana.com, that there's multiple ways to get there. Is that what you're saying? Well, you can think that like there's certain data that's stored in the blockchain, right? you can have a very low number of bytes. For example, you can have a hash, right,

which is a way to represent a larger piece of data. It's like some form of digital signature or a way to secure data outside of the system. So you have that hash that's stored in the chain, and then you can have additional information that corresponds to that hash stored in a separate. peer-to-peer network, and that's in the Atlas Network. So what that means is that we can reduce the resource requirements that are on-chain

and still allow for the same level of universal resolution for the domain name system, right? So that was an important component. And then the other thing is, you know, we have thought very hard about for over a year now how we can improve block stack and how we can really accomplish many different things but you know improve the scalability characteristics you know improve on on the on the domain name offerings that we have allow for incentivizing users and developers to to to join the system really bootstrap early network effects and that is what has driven our interest in coming out with a block stack, a token, right?

It's not driven at all by any kind of sale, like a lot of these other projects have been. As mentioned, we have been interested in doing this before any of these sales even existed. So it's very much been something that has been core to the idea of block stack. Yeah, and going back to the token a little bit, it's basically, it's a mechanism for spam protection and security of the network, because without a token, any spammer could just go and register lots of domain names for free or just abuse the resources on the network. That's why in the very, very early days in 2014, we were using the smaller blockchain called Namecoin that had a token.

And then when we introduced our virtualization layer on top of Bitcoin, again, there, there, there's the token that is Bitcoin that people need to use to effectively buy these domain names, and a spammer can't just go around and register thousands or millions of domains for free. So similarly, there's a scarce resource on our network that needs to be protected, and the token is the way of doing that. So since you're not really looking at your token as a way to fundraise, aside from preventing spam, what are some of the other behaviors that you want to incentivize in the Blockstack system? Well, really, I mean, at the end of the day, we're growing a two-sided platform, and that comes down to getting as many users as possible, as many developers as possible, and really facilitating the discovery of each other so we can get as many active users across applications as possible.

So tokens get released to developers who develop apps on the platform, or how does that work? Yeah, exactly. So, I mean, we're going to be releasing more details about all this soon, but yes, an important component. is that developers will get tokens simply by having apps on Blockstack. Huh. Okay. Well, then, so let's talk about this developer fund that you guys are launching. What is it? And why did you create it, especially if the developers can also be funded with tokens?

Yeah, I think it's basically, we believe that traditional venture capital still has an important role to play in this decentralized apps ecosystem, because they have actually seen startups over many years. They can actually help entrepreneurs with team building and a lot of other things that are needed for having successful applications being built. And one thing that we have seen in the recent interest with all these token sales is that teams without any experience are actually raising very large amounts of money without having any real guidance or support from experienced players like these investors. So our 25 million signature fund is kind of like our way of establishing this channel between app developers who want to build on top

of Blockstack and these sophisticated investors who have been thinking about this space a lot and who have some really good ideas about how this ecosystem can develop further. And who are the investors in this fund that will be advising the developers who receive these grants? So we announced their first set of investors. We're working with Lux Capital. We're working with Open Ocean, with Rising Tide, with compound, and with version one. And at the moment, so obviously we've seen that there's a lot of interest in building decentralized projects.

But for now, what attracts a developer to develop on BlockSack as opposed to something like Ethereum, which has so much buzz? There's a few things there. I mean, one, it really depends what kind of application that you're building. So if you are going to build a new system for derivatives, if you're going to build a decentralized exchange, then it really makes a lot of sense to build on Ethereum. Ethereum is really good for those kinds of complex financial instruments. It makes a lot of sense for Auger to be built on Ethereum, for example, right?

At least today. And if you're building something where you're trying to build a decentralized social network, you're trying to build a decentralized Airbnb or decentralized eBay, you should really think about what is the simplest way that you can build out your system in a way that also has really good performance characteristics, has good scalability, and will not mire you down in terms of reliability and security issues, and also something that's going to be really like cheap for your users, right? Because you don't want to introduce a new system where it's going to cost, you know, tens of dollars or hundreds of dollars just to be on your platform.

And with any of these systems, if they get scale, if they get a decent number of users, that's going to happen, right? So when you look at the existing platforms available, block stack's really the only one that offers such a comprehensive toolkit. in terms of identity, authentication, storage, everything that you'd need to get started with these applications. And we have everything completely full-stack end-to-end. We have the browser available. We have a system where you can set up your identity.

Users can set up their identity and their storage. We have those libraries. We're coming out with iOS and Android apps in due time. So we can really cover all the bases and give that developer a great experience. and give that developer the ability to bring a great experience for the user. And you can't really say that for any platform out there today. And can those developers also incorporate their own tokens onto the apps that they build on your platform?

Yeah, this is something we're looking at later on. And I think, to build off of what Ryan said, if you look at applications, like, for example, our team actually uses a to-do list app that is built on top of Blockstack. And if you just take the example of that simple application, writing a smart contract for a to-do list app just sounds absurd, right? Like, why should there be a smart contract for something like a to-do list app? Or if I'm adding an item to my to-do list, it shouldn't impact anyone else on the network. Like there shouldn't be any transaction generated that now needs to be processed by thousands or potentially even millions of people down the road.

So I think that kind of like speaks for the architecture that we have built out, where developers can very quickly, very easily build out applications like this To-do list app and have it scale out. Like we can get like a million people for this app today, and it wouldn't have any scalability impact on the core of the network, just because of the way these applications are designed. Yeah, I mean, we can really just repeat the mantra that most of the time when you think you need a smart contract, you probably don't.

Okay, but in that case, like, the reason is that every user on that to-do list, even if it's all shared across a million people, their kind of like own to-dos are being stored on their own storage. Is that? Why is it so scalable? It's scalable because think of this as, like, imagine that in the early days, when you bought a piece of software, and it shipped to you on a CD-ROM drive. And someone locally installed something, and they keep their data on their own computer, and they can use the software. And a million people can use that software without impacting each other.

And then the model changed later on where with cloud computing, a million people would sign up on a remote server that was operated by that company. And if suddenly a million people started using an application, those servers are getting a lot of load, and then you need to scale that up and so on and so forth. When you enable people to own their own data,

own their own storage, own their own software, and do things as much locally as possible, this is a model that can actually scale out to hundreds of millions of users without impacting other people, because there's no central bottleneck, there's no central mainframe computer that everyone needs to connect to just to be able to use a simple app. Okay.

And so right now you guys are using the Bitcoin blockchain. Do you plan on supporting any other blockchains? And also, how do forks affect block stack? Oh, sure. Yeah, I'm just going to build off of also a previous question that you mentioned, which is in terms of users being able to, actually developers on the platform being able to issue their own tokens. That is something that we are building towards.

and we're going to be releasing more details about that soon. But an important thing to think about is that right now, the de facto way for developers to create tokens is on Ethereum. And I think that's unfortunate. What we want to do is give developers another choice and something that integrates well with the Blockstack platform. We talked about the simplicity of giving identity and storage solutions, and we're going to absolutely do the same thing for tokens.

But what about this question about the Bitcoin blockchain and how any forks affect you guys? Yeah, absolutely. Are you planning to adopt other blockchains? Yeah. So how block stack works is that we have this virtualization layer. So our blockchain called virtual chain actually lives a layer above traditionally what people think of as blockchains. And we use underlying blockchains just for like storage. we just want to store certain pieces of data in the underlying blockchain.

And right now we use the Bitcoin blockchain. It's very easy for us to write these drivers for blockchains. Like, for example, for Zcash, there's already a bounty on our GitHub for that driver. And it's actually minimal changes from the existing driver that we have on Bitcoin. And then you can plug in the Zcash blockchain as well. Same for Ethereum and other blockchains. It's something on our roadmap. It's something that we already have bounties for on GitHub,

so any open source developers who want to contribute resources there, they can. But in general, like, we don't have any specific timeline for when these features would actually go live. So in terms of what listeners can expect next from you, it sounds like the token sale will be coming up next. What are some other things on your roadmap? Yeah, so there's the token distribution that we have coming up. That's a big one.

and then really we're building towards the new version of our browser that we can release to consumers. So you can, if you're a developer, you can download it today. If you're a user and especially ambitious, you can go and try it out on our website at blockstack.org, but we have yet to release that real consumer-ready version. So that's going to be coming out soon, and there's going to be a lot of exciting updates on there. Right. So those are really the two things that we're building towards. Great. Well, how can people get in touch with you guys? Well, you can join us in our Slack. You can go to blockstack.org and go sign up for our mailing list and sign up for our Slack group, sign up for a forum.

Come chat with us in there. We're always in there. We're happy to talk. Ask us questions about Blockstack, about development. Anything you want. I'm happy to help. And Ryan and I are also pretty active on Twitter. So you can find Ryan at Ryan E. Shea and me at At Monique, just my first name. Great. Well, thank you both so much for coming on the show. Great. Thank you so much, Laura. Really enjoyed it. Yep. Thanks a lot. Thanks so much for joining today's episode with Ryan Shea Manimba Ali, the co-founders of Blockstack.

To learn more about Blockstack and to find previous episodes of the show with other innovators and thought leaders in the blockchain and crypto space, check out my Forbes page, Forbes. slash sites slash Laura Shin. Also be sure to follow me on Twitter at Laura Shin. New episodes of Unchained come out every other Tuesday. So if you haven't already, subscribe on iTunes or wherever you get your podcasts. If you liked this episode, share it with your friends who are looking to learn more about this rapidly evolving space. And please rate, review, or send me feedback on who you'd like to see interviewed on the show. Unchained is produced by me, Laura Shin, with help from Elaine Zelvey and fractal recording. Thanks for listening.