Soqqle shares Blockchain learning points in Innovation Rainforest Workshop
Daniel talks about what his experience in kickstarting use cases in J.P. Morgan and what he would do differently if he could go back and change things.
It was clearly an uphill climb.
I used work in in J.P. Morgan as a Program Manager dealing with Equities. Working very closely with my product managers, my job was to get people to do things that they did not want to do.
And that was for something that people was supposed to do.
And when Blockchain came, things became a bit different.
“The Power of Blockchain”. Was what i shared. Here’s my typical lines:
“You heard of Bitcoin?”
“Here’s what is interesting. For the first time, money is able to be moved digitally from me to you. And no one’s in the middle, and its done way quicker then the 2–3 days it takes today.”
“Do you wonder why? It’s the technology. And you know whats cool, it’s not just for money, it can be used for anything.”
Then we went into use cases.
I had to create a team from scratch. I pulled 4–5 developers together. We met every week after work — we looked to build something cool and explored use cases for the teams.
I also looped in the users.
“Hey this can save you so much time. You know that process we can never get priortised? This can save you DAYS of work.”
We drew process flows, came up with nice flows with smart contracts to integrate. We prototyped but were faced with tons of challenges.
I had a real job. But it wasn’t the main problem. I could dedicate hours after work to build something awesome. But my team was struggling. Many had kids to take care of after work. Eventually they couldn’t keep up.
The kind of approvals needed to get the global team interested was crazy. We were in Asia, and unfortunately at that point of time — there wasn’t really an innovation guy around here. There was no distributed consensus in the bank.
I left the bank and eventually wanted to spread my wings to soar.
I left thinking that Blockchain was awesome.
I met several Blockchain experts especially the ones in Mathiannal Group who were in it since the start of Ethereum. With the influx of ICOs and badly designed tokens, i started a path 6 months ago (not long i know) with all of the learnings that the industry had for 3 years.
It could do way more.
The dream of Tokenomics when done right creates incentives for a healthy economy that is missing in many of today’s world. Many of today’s systems are singular focused. With the introduction of tokens, it creates a new marvelous concept of a tokenized economy.
However an economy is not just technology, which most people mis-understand for Blockchain. It’s a combination of psychology, sociology/anthropology, economics AND technology. The power of the coincidentally developing theories of behavioral economics is super key here. Once theories have been identified, and goals charted out, clear mathematically calculations using game theory mechanism design and model simulations can be identified.
For example, we designed our first game-challenge using the below:
You noticed that the token is hidden in the extrinsic benefit. In a theory called crowding — extrinsic motivations can often overrun a user’s smaller ‘intrinsic’ goal (most people i believe see personal growth as a minor intrinsic goal amongst other larger goals in life). We plant some smaller behavioral improvements (intrinsic) and allow for a chance for tokens to crowd out these benefits to reach the nash equilibrium we need (game theory).
And this is just for 1 task.
We have 9 types of tasks. Based on which we can then draw a process flow which is engineered into our system.
This is the first part of the incentives which allows the ability for a user to earn tokens which can be passed around to exchange and obtain cool tasks, challenges and other gifts.
A distributed consensus solution is often mysterious and elusive. Why is distributed consensus in this case so powerful with Blockchain? A deep-dive into consensus theory describes two theories in sociology, one called consensus theory one called conflict theory. The two are often at logger-heads with one saying it is needed for stability and other saying its a means to control power to limited resources. Most ICOs lean towards conflict.
The reality is that the solution needs to have Blockchain sitting in the middle. The philosophy of a Blockchain solution needs to encompass both stability as well as allow for freedom of expression. Therefore most economically-viable solutions end up having a dual-token model.
For Soqqle we opted for something a bit different from a dual-token model to achieve the same effect, without the confusion. As token mechanism and design is a big monster on it’s own, i’d write about that separately. There’s some intro here.
Blockchain is of course not totally without it’s headaches. The biggest are risks that we have to be aware of. Without regulations and feedback from experts it is difficult to make right decisions.
For example, there is a need to ensure top notch security and kyc rules / policies for the processing flows. Often these are not something that are done in most of today’s systems. Why is it anything different now? Well, we make sure that our processes are streamlined, covers all angles and where multi-parties are involved in transactions, they are all done in a way that is safe for everybody.
In one of the earlier meetups, one of the previous founders who completed his ICO recently claimed that KYC is not needed and made comparisons to existing systems like Spotify that when you pay subscription fees no kyc is done. It’s an absolutely clueless comparison given that the business model and ‘follow the money-trail’ is completely different.
Therefore with a token economy, we can have a solution that does not just instill trust by the system, but also can instill trust by the processes instilled by the people, and still have an incentivizing economy that promotes healthy circulation of added-value to people’s lives.
One of the last slides included a what i would do differently in the bank.
- A corporate ICO — where all companies with a stake in the solution should participate to create a fully decentralized banking solution. I will describe at a later point of what kind of decentralized solution it could be.
- Integrated Tokens — Can tokens be integrated in the bank’s operating system to facilitate good-will, and good behavioral? Can we tie our learning and development to tokens as an incentive?
- Shared Ledger- A decentralized solution as a cooperative game to promote good use and streamlined operational processing.
- Smart Contract- Smart contracts linked to tokens-as-trades that can self-execute life-cycle events tied to scenarios executed by the exchange. (Corporate actions). It can also tie to credit ratings based on trade factors like direction.
The last slide and ultimate goal goes into a fully decentralized solution.
Banks can last the stand of time. Businesses always need money to run. Besides crowdsourcing, liquidity providers are one of the only other alternative solutions. A decentralized solution that evidences how a party is providing sufficient liquidity to improve the world will surely cast a foothold into the future.
However, who will manage the data, and operations managing the decentralized solution?
It will likely be either centralized teams, or Artificial Intelligence.
