I’ve recently had the chance to work with the Kin platform to build a chat themes feature inside Kik and have been thinking about how Kin, in general, might solve some of the problems the industry faces when building for long-run blockchain projects. Vitalik Buterin has obviously been considering how to solve some of these problems with Ethereum. Like many times in life, when you want to solve big problems you need to ask some hard questions. Vitalik asked several such questions to the cryptocurrency community at large the other day, and as I read it there were a few things that came to mind…
“Why aren’t there any useful large-scale applications yet?”
- The incentives aren’t there. Great technology on it’s own is something out of reach for the average non-funded developer and can be a hard sell for developers that are focused on approaches that already make them money.
- Kin is rewarding growth by feeding the mouths of developers today, so that they’re building for tomorrow. A great example of how this is happening right now is through the Kin Developer Program, and later on through the emergence of the Kin Rewards Engine.
“Why are there not yet good solutions to account security? When will the problem of account hacks and thefts be solved?”
- Security is hard to do right. The technology that most blockchain’s are trying to build or grow is generalized to a ‘one-size-fits-all solution’ without the option of being fast or secure. In a developer’s world, typically you can make things that are fast, secure, or highly generalized — pick two.
- Kin is building with a multi-chain approach. Each blockchain optimizes for a different set of criteria: Ethereum for liquidity and security; and our custom fork of Stellar for scale.
- In standard consumer experiences, it’s also expected that accounts or wallets have basic features like account recovery. In the crypto world, your private key is everything, and if you lose it, your wallet’s balance is something you could easily lose. Given this, it’s likely that the safest place for that key to remain is on a client, perhaps on a user’s phone. This presents a challenge for account recovery because if you uninstall an app or lose your phone, you also lose your balance.
- Kik and Kin both understand the value of having these standard consumer experiences like account recovery. I think the strength we have in building a consumer app for almost a decade will help us solve this problem in an elegant way.
“How can decentralized apps work well even with five- to 10-second blockchain latency?”
- They probably can’t. Consumer’s of today’s applications are increasingly demanding perfection in the software they’re using. Watching a spinning wheel or progress bar was a trick Windows 98 did well to hide latency, but mobile users of 2018 are able to buy things with a credit card at the click of a button…so why would they accept a regression to tactics of the past?
- Kin combines the power of decentralization with security and portability options through a multi-chain approach. This means that you can keep the bulk of your funds on one blockchain where you might have higher latency transfers, but also higher confidence the money isn’t stolen, and keep a fraction of it ready to spend on the other where latency is minimized, but there may be higher opportunities for theft. I see this two-layer solution as something not unlike keeping the majority of your fiat currency in your bank account, but slush money in your pocket.
“Proof of Work (PoW) is burning billions of dollars per year, even more than all scams and thefts combined,” Ethereum’s co-founder asked, “Isn’t this a big tragedy?”
- Absolutely. It’s clear that PoW isn’t efficient. The focus on rewarding massive power snorfuling networks (as a proxy to dollars) just to run the network feels fundamentally misguided. The purpose of any platform venture has to be adoption. If there aren’t applications to make use of the platform, then there isn’t much left to do other then talk about and speculate on the future of what could be done with it. Sound familiar?
- Instead, I think if the approach was taken to focus on rewarding the builders of applications instead of the owners running the network then speculative trading just becomes noise compared to the volume of potentially more valuable uses. This approach is not unlike how app stores during the rise of the mobile era grew the adoption of mobile platforms. It’s no surprise then why Kin is choosing to focus on rewarding developers.
“What are the centralization risks in proof of stake?”
- I think that proof of stake is not unlike how the richest people in the world are able to have influence on policies that suit their interests and over time get what they want in the traditional fiat system. The users with the largest stake in the system contribute the highest towards confirming a transaction.
- Proof of stake certainly isn’t the only way to achieve a faster blockchain. Stellar, and by extension, a Stellar fork such as the Kin Blockchain, doesn’t rely on proof of stake or proof of work.
“Given how EOS governance has turned into an epic fail, doesn’t this mean that all on-chain governance including DAOs is fundamentally flawed? How can any DAO deal with bribe attacks, plutocrats and other risks?”
- Step one: Fund developers with a scarce asset to build your asset’s ecosystem.
- Step two: Have a sufficiently large enough group of quorum nodes that mitigates collusion but is economically aligned to optimize for maximum value creation of your scarce asset to benefit all. Developers make money by growing the whole size of the pie, not just by increasing their own slice.
- Step three: Everyone profits.