AlchemyBytes Dual Token ICO — An introduction to AlchemySmartLabs — the unique element of AlchemyByte
Alchemy Smart Lab’s first task was to design its own funding token, AlchemyByte (www.alchemybyte.org). This was accomplished in six months, from February 2017 (when the lab came together as a working group) to August 2017, having been conceived as a concept in the summer of 2016.
The key design instruction for AlchemyByte was to create an asset that would have embedded value in addition to its link with the lab projects and to find a mix that would ensure token holders derived maximum value from holding it. We were asked not to create a token whose value was purely dependent on the success of the lab projects: it had to have clearly determinable embedded value. Also that embedded value had to be absolutely verifiable and not just a matter of supply/demand or sentiment/opinion: the value had to be provable and calculable. We think we achieved this.
AlchemyByte is a new digital token backed both by other crypto assets whose value is determinable and auditable, and by the development work of its laboratory — AlchemySmartLab) which is already in operation. 10% of token sale proceeds will be allocated to the AlchemyByte Smart Economy Laboratory (“AlchemySmartLab”). www.alchemysmartlab.com
AlchemySmartLab will work as an interactive cloud based networking hub, bringing together talent (young and old) from around the globe to work towards the achievement of a borderless smart economy with services provided digitally and payment for services also made digitally. We believe that the new future Smart Economy must be “smart” in both senses of the term: digitally and intellectually.
The AlchemySmartLab will work towards the end of the historical “stupid” economy of tariffs, barriers, political meddling and other reactionary disjointed thought models. The invention of the internet, now enhanced with blockchain technology enables businesses and consumers, businesses and businesses and even consumers and consumers to connect globally, speak and meet online for no cost and transact business while paying for goods and services instantly, easily and without high bank charges by simple transfer of cryptocurrency between wallets. As transactors also now have a huge choice as to what currency they settle transactions in, costs of transactions will inevitably fall as competing cryptocurrency issuers and existing democratised networks will reduce transaction fees to attract use.
AlchemySmartLab has already, Pre-ICO, started work on a number of interesting projects. Of course, as all of these projects will lead to proprietary intellectual property value which must be reserved for the benefit of initial token holders and therefore it would be inappropriate in a public whitepaper to go into any level of detail, a “flavour” of just three of these projects, however, is set out below. Some of the projects are improvements on existing technologies while others are genuinely “disruptive”.
1. AlchemySmartLab will work to integrate smartness into the “real” economy by assisting would be users with the necessary technical advice to start implementing cryptocurrency and smart contract solutions in terms of payment models and invoicing. For sure, there is as much (if not more) business to be had in this area as there has been over the last 25 years in getting companies online. The difference this time around though is that it will happen more quickly and players entering this space now will take a good chunk of market share. Players who have already entered the space are experiencing increasing uptake even now but the task is still huge compared to the relatively low number of existing advisers.
2. One of the major obstacles to the adoption of cryptocurrency in high value international trade transactions is in fact one of cryptocurrency’s key perceived benefits: non-reversibility. In the original Bitcoin Whitepaper Satoshi Nakamoto wrote in the Introduction: “Commerce on the Internet has come to rely almost exclusively on financial institutions serving as trusted third parties to process electronic payments. While the system works well enough for most transactions, it still suffers from the inherent weaknesses of the trust based model. Completely non-reversible transactions are not really possible, since financial institutions cannot avoid mediating disputes. The cost of mediation increases transaction costs, limiting the minimum practical transaction size and cutting off the possibility for small casual transactions, and there is a broader cost in the loss of ability to make non-reversible payments for non-reversible services. With the possibility of reversal, the need for trust spreads. Merchants must be wary of their customers, hassling them for more information than they would otherwise need. A certain percentage of fraud is accepted as unavoidable. These costs and payment uncertainties can be avoided in person by using physical currency, but no mechanism exists to make payments over a communications channel without a trusted party.” The blockchain has obviously now solved the non-reversibility issue through the peer to peer decentralised ledger. The Bitcoin whitepaper goes on to say: “What is needed is an electronic payment system based on cryptographic proof instead of trust, allowing any two willing parties to transact directly with each other without the need for a trusted third party. Transactions that are computationally impractical to reverse would protect sellers from fraud, and routine escrow mechanisms could easily be implemented to protect buyers. In this paper, we propose a solution to the double-spending problem using a peer-to-peer distributed timestamp server to generate computational proof of the chronological order of transactions. The system is secure as long as honest nodes collectively control more CPU power than any cooperating group of attacker nodes.”
Again, the blockchain has also solved the double-spending problem but there is no widely adopted decentralised solution to the buyer escrow issue. The Ethereum solution — the Smart Contract — is indeed a very good solution in some (many) cases, the example of the options contract (https://blockgeeks.com/guides/smart-contracts/) is one such application of Smart Contracts that needs little if any refinement, however the apartment keycode example which Vitalik Buterin used in the conference referred to in the link above is somewhat less perfect. What if the apartment is deficient in some way? For example, a leak or a damp wall. How can this potential “breach” of contract be catered for by a Smart Contract? How bad is the problem? Is it so bad that the apartment is not usable? Who decides? — ,
ost readers will agree that this cannot be determined by a Smart Contract without human intervention, so again we return to Nakamoto’s “trusted third party”. To give another example, let us take the delivery of goods across long distances. The goods are dispatched — the goods are received; all is well. But what if the goods arrive damaged? How damaged is “damaged”?
AlchemySmartLab already started work on a model for a solution to this issue using the same concept as the “peer-to-peer distributed timestamp server” to quote the Bitcoin whitepaper. This will be based around the concept of decentralised “trustee” nodes and will ensure that escrowed cryptocurrency is able to be claimed by sellers when goods are delivered (in acceptable condition) to buyers but not before. Similarly, we are also working to address the issues of non-functionality of delivered goods, damage in transit and even include a tokenized form of insurance all within a smart contract suite that is both independently auditable and at the same time decentralised. This in turn is linked to the escrow arrangement and will release funds as per the smart contract … or even for the time being what we may term a semi smart contract.
3. The third project is perhaps the most interesting but also the most challenging. Globally many billions (trillions?) of dollars are controlled by fiduciary arrangements: predominantly trusts and foundations. Each of these arrangements currently requires domiciliation, as does the one that the Token Issuer will arrange for the Master Trust to hold the assets which back AlchemyByte (at least initially). It is the domiciliation of the arrangement which determines its proper law and its regulation and via its regulation the comfort that any beneficiary of such an arrangement might desire that the arrangement will be administered fairly and in accordance with both the settlor’s wishes and the beneficiary’s needs.
The very need for domiciliation however renders the arrangement subject to the whim of the domiciling jurisdiction’s legislature or indeed the cowardice of the domiciling jurisdiction in failing to resist the demands of foreign governments’ latest “information exchange” initiatives which inevitably render what should be a private matter between settlor(s), trustees and beneficiaries a very public matter indeed. Is there a solution? Of course, there is: it’s a supranational trust arrangement by smart contract based on consent between sovereign human beings without regard to the laws of any particular jurisdiction. In cyberspace, any group of humans can make their own laws as appropriate between themselves, including laws on trusts. We already have players discussing what happens to wallets on the death of the wallet holder, this is just a logical next step. We have within the AlchemySmartLab team several highly experienced trust/foundation practitioners. Most of the projects will require trusted nodes, other functionaries and co-developers in order to be completed and operate. AlchemySmartLabs roadmap will be published in the near future outline key projects and their order of priority.