Yifan He from Red Date Technology: How to Understand “Blockchain” in BSN

Cointelegraph China hosted the Great Bay Area International Blockchain Week from August 5–7, 2020 in Shenzhen, China. Yifan He, CEO of Beijing Red Date Technology and Executive Director of BSN Development Association, and Qiang Ma, COO of Beijing Red Date Technology, were invited to attend this conference. They introduced the architecture, security and privacy mechanisms of the Blockchain-based Service Network BSN (referred to as “Service Network”, “BSN”) in Chinese and English respectively.

During the speech, Mr. Yifan He reinterpreted the logic, technical advantages, and development track of blockchain from a new perspective by benchmarking the Internet with BSN and put forward a prospect for the future development trend of blockchain technology. We have selected excerpts from the conference speech videos and texts for your reference.

Video: (In Chinese)

https://v.qq.com/x/page/j3014bco2gu.html

Content:

Today, on behalf of the BSN Development Association, I will give you a brief introduction to BSN. To begin, I want to spend some time explaining BSN fundamentals and its infrastructure so everyone can better understand why we do BSN and what BSN is. I will brief you on how to understand blockchain and distributed ledger technologies from the perspective of BSN.

First, we believe blockchain technology is a new and growing information technology and a continuation of the information revolution of the Internet. For about 300,000 years, we have been surpassing the information revolutions of mankind, one by one. What was the first information revolution of mankind? It was the ability for people to speak and express what their thoughts in rich languages. Data is transferred from the mind to spoken language. As this data transmission grew, the need for people to store this information became increasingly important. From this need, text appeared. Text is the first information storage method in human history. Don’t underestimate this. As more and more information was stored in textual format, it would take a long time just to pass the information distantly, such as sending a letter. Time delays would lead to the development of new data transmission technology. This is when the telephone and telegraph appeared, although the process took nearly two to three thousand years. The development of the telephone and telegraph directly changed a large number of production relations and methods, including war. With this kind of data is being transmitted, there became a problem of storage as there was not enough paper to record all the information. After another 40–60 years, computers were developed and began to store data in binary form. Today, we can store all of the information of a library on a hard disk. As there is more and more data on a computer, another problem arises. How can we transfer data from one computer to another quickly?

I believe that many people have experienced this issue. I have been involved with computers since the 1980s. In about 1995, I could not transfer a large file through dial-up Internet. I could only burn it onto a CD and send it out via express mail. The advent of the Internet gave us a new mechanism for data transmission that allowed data to be exchanged between two computers in seconds. Such a simple exchange has changed the entire human society and all business logic. We believe that blockchain technology is an upgrade of the Internet transmission method and a new method of data transmission and storage.

For example, let’s say we have a business involving four people. One transmission method is Person 1 talking to Person 2, Person 2 talking to Person 3, Person 3 talking to Person 4, or even Person 1 talking to Person 2 and Person 3 first, and then Person 3 talking to Person 4. This kind of information transmission model is similar to the Internet model, however, there are many interaction issues between parties. In the process of transmitting messages, there can be fake information, misunderstandings, or even just forgotten messages. I think we’ve all seen it before. Let us say these four people are fed up with this transmission method. Everyone agrees to sit in the same room and talk together. One person talks and the other three hear what is said. Everyone knows that everyone has heard it. This transmission method is the basis for a broadcast-style transmission of the Internet. If we are in the same room, I know that you are yourself. If these four people are spread among four continents, and you also want to realize this kind of information transmission and information verification, a set of IT systems are needed to implement this communication mechanism. As a result, we have blockchain. We have distributed ledger technology.

The actual blockchain or DLT technology is not a new model. It simulates the kind of broadcast communication model that we humans use to commune in groups as early as we lived in caves. We just built the same transmission method through information technology to handle more people, more data, and more distances. This is the essence of blockchain technology. When there are just four people in a house and they say that no other people are allowed to enter, it is a Consortium Chain. If we say that countless people can get into this house, and they can enter directly without permission, and there are 1 million people in our house, it is a Public Chain. Then during the communication process, millions of people said that we have a set of algorithms. We calculated a string of codes based on this algorithm. Someone calculated this code and spent $5 dollars. Everyone agreed that they did spend $5 dollars. Then everyone considered the code generated as 5 dollars, here comes cryptocurrency. Blockchain is an important process of transmitting and storing data and information. The consensus that blockchain technologies are based on, is formed just because of this kind of data transmission method. It has built a new way for mass communications and created brand new business scenarios and business models. This is our understanding.

Due to this way of information transmission and storage, new information technologies, such as blockchain, have two factors that either hinder or promote the development of such new technology. Firstly, the cost. Like the Internet, if it took millions of dollars to build websites in 2000, it would be almost impossible for the Internet to grow. It also means that for any information technology, the cost must continue to fall infinitely close to zero so the technology can flourish. It is similar to the time when writing on paper came into existence. In the beginning, the cost was based on how expensive your paper is. Can I afford this paper to write on? Secondly, how high is the cost for me to learn how to write characters? Does it take 20 years to understand a language? These two costs: learning and resources, are directly related to the overall development of the technology. Today’s Blockchain technology is similar to the beginnings of the Internet. In the beginning, the cost is very high. You may spend several million dollars to build a website. Especially in the LAN era, as you must buy computers and related equipment. With the gradual reduction of costs, and the release of cloud services, now anyone can build a website for less than $100 dollars. Similarly, programming began with machine code and later moved to high-level languages. As programming languages got more and more refined, and programming costs are got lower and lower, we saw the boom of the Internet. Comparing this to Blockchain, we know that its cost must be infinitely close to zero, and the technology to build a public chain should be as simple and fast as pressing a button. The resources people need to build a consortium chain should be inexpensive. Everyone should be able to build a chain and bear the cost, so that the blockchain industry will flourish.

What is the second major factor? Information technology must develop interoperability and reduce interoperability costs. As everyone did not have the Internet in the early 1990s, they were building local area networks. It was not interoperable, and many business scenarios were not possible. For example, if China Mobile was always its own local area network, and the bank was always its own local area network, mobile payment technologies would never appear. Interoperability is particularly important, but there is a cost issue around interoperability. Do not underestimate the difficulties to achieve interoperability. As I mentioned earlier, a lot of information in the information revolution is not interoperable, such as language. I was discussing with Mr. Ma just now what iFlytek does. It is used to make language interoperable, such as Chinese and English intercommunication. Think about it. If all societies communicate in their own native languages and regardless of what languages they speak, everyone could understand each other in their native languages. It is unimaginable how fast the economy and technology in human society will progress. However, many of our languages are still not interoperable. An information technology that has been used for 300,000 years has not yet reached complete interoperability. So, interoperability is important and difficult.

What problem does BSN actually solve? Exactly the two problems I mentioned. In the beginning when we designed BSN, we thought that no matter what people build, a public chain or a consortium chain, the cost should be infinitely close to zero. We saw the current blockchain industry, from a technical point of view, similar to the Internet of 1993 and 1994. Every public chain and every consortium chain is a local area network of the past. If the local area networks did not connect to form the Internet, the business logic between could remain quite simple. But when you link together the data of various economies, various companies, people will begin to innovate and flourish based on such interoperability and data sharing. We want to see BSN grow as a huge interoperability environment. First, data on all chains will be interoperable. Second, it must be cheap for everyone to use. It must be infinitely close to zero. Though it cannot be zero, it must be as close to zero as possible…