The OST vision to be the essential technology fabric that enables the decentralized web, how we’re going about building it, and more from our recent AMA

Our vision at OST, “Open Simple Token,” is to be the essential technology fabric that enables the decentralized web — the blockchain infrastructure and toolkit that companies of all sizes rely on to provide more open, fair and valuable customer solutions.

Last week we hosted an Ask Me Anything (AMA) session on YouTube with myself and Ben Bollen (OST Chief Blockchain Strategist). We received many questions during the live broadcast, as well as prior to the AMA on our subreddit.

In today’s post I call out seven questions and answers that speak to our overall vision and the technology we are building at OST, and importantly: why we are building it.

Watch the complete AMA here or read the transcript from 7 questions below to learn more about our vision and execution. (Our team will post more Q&A from the AMA in subsequent posts.)

(1) How have things have been going at OST?

JASON: We have been very much focused on building real solutions. Our number one KPI at OST is not how many people bought a token this week, it’s not the price of the token. Our number one KPI is 50 solid customer success stories, meaning really functional token economies. We say if we can get 50 highly functioning token economies, that’s a proof point for us to build on for a long, long time.

Basically the last six months we’ve been focused on four things.

Number one is team. When we ended our ICO (in December 2017), we had a software development team who had a lot of experience in web development, in application development, and we had a burgeoning blockchain technology science team that Ben was leading. We were about 24 or 25 people, and mostly on the engineering side. Since the ICO, we’ve now grown the team to over 50 people covering all facets of the business, including commercial aspects of the business. So we have teams in Hong Kong, New York, Berlin, and India, and we’re focused not just on building the solutions but also in signing up partners, companies to work with us on those solutions. Number one has been the team, so getting the team in place.

Number two has been the technology. Ben will walk through what we’ve been working on on the technology, and the very big vision that we have regarding technology.

Number three has been on the partner side. One of the things that we’re really proud of when it comes to OST is that we’ve been building with our partners, and announcing real partnerships and working with partners to build on the technology. This is a critical component of our solution set, blockchain technology is in the very early days today, and it’s going to take a very long time for some of it to emerge. Even the things that our customers start to use in the next few months will still be many, many years in development as they get more and more perfected and add more and more features and capabilities. I’ll talk through the longer-term roadmap in a bit as well. Building with partners has been an essential part of our strategy from the very beginning, so that we’re not building in a vacuum. You may have seen that we have announced about 30 partners. There’s others that we haven’t announced yet.

Some of the larger partners that we’ve announced are companies like Unsplash, which has over five billion photo views per month. We announced last week a partnership with FinComEco to do some amazing work on a token in Africa. We’ve got some other great partnerships lined up as well. With each of these partners that we have announced, the first step is working with them on technology, working with them on integration, working on planning a token economy, and that’s the same thing that we’re doing publicly right now in our alpha phase two, where we’ve had 250 development teams apply to be part of Alpha Phase II. 142 teams were selected, and 85 of them have basically met the first hurdle and it looks like they’re also meeting the second hurdle to submit a POC integration with Alpha II of the OST solution.

Number four is community. The fourth leg of our stool in building out our strategy is to build with the community. We’re very thankful for community support and for pushing us and to continue to ask great questions. We can’t do this alone. We need your help. We need the community support, and it is an area that we are pledging to do much more of in the future is to come back to the community and involve the community more, and have a much more larger presence in the role of the community. We’re going to be doing more blockchain and Ethereum meetups and meetings. We’re doing this AMA today. We’re doing one next week in New York with Betaworks, which we just announced. You can expect a lot more of seeing OST out there with the community as we move more and more towards customers and companies using our solutions.

(2) What’s been the biggest challenge so far in terms of the overall project?

JASON: I’d say the first is we want to be a solid project and really stand out in terms of proving results versus just hype, and so for us the market, there’s a very speculative market in crypto, and there’s a lot of folks pushing to say, “Get the price up. Get the price up.” That’s not our focus. The OST token is a utility token that is used to stake against minting branded tokens. It’s a token that we think thousands and thousands of companies will use and have utility from. Our focus is build that solution and make it useful.

One of the struggles is how do you stay focused on “Get it done. Get it done” when the market forces are saying, “Scream louder. Scream louder.” Then I think the other is just it’s also that balance between the here and now and a massive vision that we have.

We purposely haven’t gone out there and thrown out, “Here’s what OST is going to be in 2022, or 2023, or 2025.” Because we also want to sign up companies and customers and partners to work with us right now to build the near term.

We’re building this for real use now, in 2018, 2019, but we’re excited to start telling the broader arc of where that story is going out in the distance in the future.

(3) Ben, from a tech perspective, what’s been the biggest challenge for you?

BEN: There is this very promising thing that we call web three technology, where you regain ownership of your data and specifically your tokens. The question is if we want to scale this to millions and potentially billions of people, we really have to understand deeply the problems that we need to solve. Scaling is often understood in a transactions per second number that we need to push up, but it is also user adoption and other problems that we really need to understand. The biggest technical challenge is really trying to understand the problems that we need to solve in order to enable scaling, because it’s a set of problems that need to be solved.

If our main hypothesis is connecting the existing digital platforms with web three technology, also the development cycle is entirely different, because on the web development cycle you can do agile development. On the smart contract cycle you effectively need to launch a smart contract into space, and you can never touch it again. Those two need to go together. Building out the roadmap has been a huge challenge of building out that gradual launching of smaller and smaller satellites into Ethereum blockchain’s space.

(4) Darrick Urso is asking ‘would we say our value proposition is creating tools for a market we anticipate explosive growth in?’ How do we think about creating our tools for the market?

JASON: Building on what Ben said is that we think that we’re moving to a world call it decentralized internet, or call it web 3.0 where transactions are happening between parties in a decentralized way, in a trustless way, and that so much of transactions that go through intermediaries today are going to happen in the future this way. It’s going to be both transactions between individuals, individuals and companies, companies and companies, and machines and machines.

One of our purposeful actions and our strategies is not just work with DAPPs, decentralized applications, and not only build the web 3.0 for the future, but to work with mainstream companies right now with millions and billions of transaction volume and user interactions and help them move those transactions onto the blockchain. It has a lot of complications to it, but they’re real interesting problems to solve.

(5) A question for both of you guys is to share more details about the product roadmap. What are we thinking about for the rest of 2018 and the bigger vision for OST?

JASON: We see a world where let’s say five years from now much of the transactions today that go through central authorities are basically happening in a decentralized manner. A lot needs to happen to get between here and there.

With our roadmap, we’re trying to solve five very hard problems for customers and towards this big, massive vision.

1. Improving the usability of blockchain is a big challenge.
2. Scalability is another one.
3. Making sure that you have integration between existing apps and services,
4. Making sure that there’s trust that all the transactions are actually real and they’re going to go through,
5. Providing liquidity of branded tokens once they’re acquired by people.

These are five problems we are working to solve, and there’s going to be many more, but these are 5 big things to solve.

The pieces that we’ve been putting in place in the roadmap to answer these challenges are as follows:

• The first thing that we did was the Open ST protocol. The OpenST protocol was to say if a company wanted to launch their own tokens, the Open ST protocol enables them to stake OST on Ethereum mainnet against launching and minting their own tokens on open, scalable side chains. The invention here was it’s a usability innovation as well as a scalability innovation to help take basically mainstream companies to be able to launch their own tokens without having to build everything themselves and to also move the high volume, high throughput traffic off of public Ethereum and onto side blockchains but still retain all the properties of public Ethereum in terms of immutability and accountability of those transactions.
• At the same time concurrently we started building the OST layer, which is like a software layer, which is a set of software APIs and SaaS to enable companies to manage and integrate basically Open ST and its benefits and branded tokens into their businesses.
• Then where we’re going with that next is a series of phases. The next phase which we’re actually working on now which is called OpenST Mosaic is all about scalability and economic finality in a fully decentralized manner. I’m going to turn to Ben in a second who’s going to talk through exactly what OpenST Mosaic is.
• Even beyond OpenST Mosaic, where we’re going even beyond OpenST Mosaic is in the fourth phase which it’s not exactly linear. We’ll be working on this while we’re working on OpenST Mosaic — some folks will also be working on this next phase — is how do you actually enable exchanges of branded tokens. Let’s say if you earn an Unsplash token, how do you not just exchange it with someone else within Unsplash, but also exchange it across the OST network, then across anywhere that’s Ethereum-enabled, so any other Ethereum token, and then eventually atomic swaps across any crypto or any asset for that matter.
• That’s really interesting stuff that we’re thinking about for the future. After that it’s how do you enable via AI maybe machines to do this, and to do it a sort of intelligent way so that it’s not just humans to humans interacting across from the side chains to other cryptos. There’s a lot of components going into this.

(6) Ben, because we’ve had this question a number of times, why don’t you explain to everyone what OpenST Mosaic is and what our team is working on right now when it comes to OpenST Mosaic?

BENJAMIN; I can drill down on the roadmap so far, and where we’re working on and going in the near term. We had a few releases:

• We had OpenST 0.9.0 before the ICO, which was a proof of concept that we integrated into Pepo App, and then
• We released OpenST 0.9.1 which really was centered around this concept and introducing this concept of staking and minting. Why we use those two verbs is because there’s two independent systems running. One is the staking where all the value is defined on Ethereum mainnet and then the minting is for a company to use that value that is backing its new branded token, and using it as a white label token OST to create its own in-application experience.
• Then we released OpenST 0.9.2, and where we focused there was really on the token rules, so the early economic behaviors that the company could define that would make this token its own token, so that the token really had the behaviors that the application designer wants, and so that you really can look to build a token economy that’s unique.
• Then with OpenST 0.9.3, what we’re working on right now, is making Open ST a complete protocol. The current sprint we’ve been a bit more silent about it, but it’s a very technical sprint. We’re improving and completing the protocol, and this is a unique contribution that doesn’t exist, so that you can actually transpose the value of those tokens without anyone else participating. You as a user or company can generate all the proofs that you need to present to either auxiliary system, the utility chain or the value chain, to stake and mint or redeem and unstake your tokens. Also, as an end user you can independently of the company, independently of OST always take the value that you have in branded tokens and take it back to Ethereum to have the OST that backed it up. It’s a very crucial, fundamental stone that we needed and is that the protocol functions without the ability for anyone else to block the user’s ability to regain the value that he had that was back in the OST originally

That’s what we’re working on right now. It involves all sorts of things with Merkel proofs and making them efficient, and committing state routes of the other chain on the first chain. This is also where OpenST Mosaic comes in. We’ll be working on OpenST Mosaic starting from now. What OpenST 0.9.3 allows us to do is to start building OpenST Mosaic; now, I’ll detail that in a second, and start building that in parallel. This is a proof of stake system, and as people who are aware of the space know, this is all still to be tested, and we also expect this to be running in parallel with the production system. So when companies feel comfortable to transition over, they can do so.

The important part for us is that we have a runway where OpenST Mosaic runs in parallel and that’s with the production system, and we can assert that it works well, and we can build up an open set of validators that have a stake into the system. That’s what OpenST 0.9.3 also enables. Then very briefly, just taking a step back, so what are the problems that we want to solve? We touched on that we want to connect existing user platforms with token technology, cryptographically defined tokens on Ethereum mainnet.

There are three core problems that we had identified on the protocol level that have to be addressed.

1. One is scaling Ethereum and scaling here in the traditional sense of how do you make sure that you don’t build Ethereum, that we have enough transaction throughput, that you have economic finality of the transactions mined. There’s also two other very important problems.
2. One is user friendliness of the wallet, of cryptographic tokens. If we want to scale this to millions and billions of people, we need to be able to give them tokens without them first learning what is cryptography, what is Ethereum, how do I manage my key. That’s a piece of work that we call token holder contracts. The simple trick that we do is we have smart contracts that the user owns, but that allow much better user experience when handling his own crypto within the application, so that you don’t have to start managing cryptographic keys for all the applications that you might have, but rather you have one wallet that allows you to manage all the contracts that you have that have the tokens for you. That eases the user experience quite a lot. That’s where we’re working on OpenST 0.9.4, and very interestingly also that work will allow our partner companies to build their own smart contracts and build their own additional logic on top of OST beyond what we provide out of the box. I’m looking very much forward to that.
3. Then the big piece is also OpenST Mosaic. The question is how do we make sure that we can actually execute the transactions of all those partner companies while not bloating Ethereum or creating a bottleneck. I’ll not go into a rabbit hole, but people will probably have heard that there is a lot of work that has gone into proof of stake systems. There are projects, very interesting ones that tried to build proof of stake as a new chain. Then Ethereum itself puts work into a hybrid roadmap towards moving Ethereum from proof of work towards proof of stake. What we do with OpenST Mosaic is we take all those learnings and we take it one step further, and we explicitly also solve for the problem at hand.

We use Proof of Stake to finalize and secure these auxiliary systems. What that effectively does is that Ethereum is fully verifiable. All tokens are only defined on Ethereum, so a full node on Ethereum can see that everything happened correctly, but the full node doesn’t have to verify the specifics of an application that happens on this auxiliary system. However, if you have a stake and an interest in that application, you can verify Ethereum mainnet, and you can run a full node for that auxiliary system. That is what the OpenST Mosaic node will do, and then it’s also an open system, so you can run that node and participate into the staking game where you define and get rewards in OST for participating in the economic finality of what has happened on the auxiliary system.

(7) How does OpenST Mosaic work in terms of people and the sealers and could they earn money through the system? How does that economic finality happen and what are the roles that people could play?

BENJAMIN: Yes, it’s an open system, and so this was an important conundrum also to solve. On the one hand you want to have a very performant blockchain backend that has a high availability, so actually using a POS system with highly available nodes, high performant nodes benefits you. Then that’s a closed system, and that doesn’t solve the core problem. What we do is OpenST Mosaic is a layer two network, but it’s specifically a layer two network that connects to Ethereum mainnet.

A quick definition: People often refer to layer two solutions that build logic on top of Ethereum in this case now, and so in the list are State Channels, Plasma, Truebit. I hope I don’t forget any important names. Those are what people think of as layer two solutions, and OpenST Mosaic fits in that category, and specifically, as I said, we build a proof of stake system that has a stake defined on Ethereum mainnet, and also the rewards are then rewarded in OST for those stakers on Ethereum mainnet for the work that they’ve effectively done on the auxiliary systems. The reward is specifically a cut in the gas price or the transaction fees that have been paid for the amount of gas that has been consumed on the utility chains. That is all summed up and then rewarded to the sealers of OpenST Mosaic.

Watch the full AMA on YouTube:

About OST

OST is building the complete blockchain toolkit for business. We strive to be the blockchain technology partner of choice for businesses of all sizes and levels of technical sophistication, enabling any business to create, launch, and manage their own branded digital token economy powered by OpenST protocols and OST blockchain management software. The OpenST protocol enables companies to launch branded token economies on highly scalable, open, cryptographically auditable side blockchains. OST has offices in Berlin, New York, Hong Kong, and Pune India. For more information, please visit: https://ost.com/