AMA with Gabriel Kurman Co-founder of RSK about their project, Rif OS and the future of blockchain technologies

Transcript of the Vocal AMA from our telegram channel www.t.me/StartupToken Also available in audio.

StartupToken Team: Hello everyone and welcome to our AMA with Gabriel Kurman, Co-founder of RSK (Rootstock)

Hello Gabriel, thank you for joining us today!

Gabriel K: Hello everyone!

Can you introduce to us what is RSK and how it works?

Gabriel K: Sure! So, hi everyone! Thanks for the invite and for joining this ask me anything about RSK. RSK is the first smart contract platform secured by the bitcoin network and infrastructure. It is a fork from Ethereum J so the RSK Blockchain is fully compatible with Ethereum. You can run smart contracts on solidity; you can use truffle, metamask, web3 and all the same RPG methods. But the difference is that, the smart contracts on RSK are secured by the bitcoin network. So, the RSK Blockchain is connected to the Bitcoin Blockchain in two different ways. On one hand, the same Bitcoin miners are the ones to secure the smart contracts integrated at the pool level. RSK currently has 30% of total Bitcoin and with that is as secure as Ethereum in terms of 51% attack. The bitcoin miners just make their money by mining bitcoin, this is an extra revenue stream for them and for that reason, RSK fees are one third of that of Ethereum.

Now, of the RSK Blockchain, [on the other hand] it’s been implemented as a side chain of bitcoin which means that instead of using Ether to pay the execution of smart contracts as fuel, we used something called “smart bitcoin” or RBTC. The smart bitcoin is peg one to one with bitcoin. And the way it works is that you send an x amount of bitcoin or satoshis to a peg address. Those bitcoins get locked and with a private key derived from your same private key or private address, you get your private key on the RSK Blockchain. So, you manage those smart bitcoins, you use them to execute smart contracts. And whenever the user or the miner wants to cash them out, they send them back to the peg and release the bitcoin that were locked in the first place. So, for these reasons, RSK has so much support from the whole bitcoin ecosystem because if RSK is successful, that would imply thousands of bitcoins locked in the peg and a potential increase in the bitcoin price and the full utilization of bitcoin technology for the execution of smart contracts. And also, RSK has full support from the bitcoin mining industry given that this is the first time that it allows them to participate in the smart contracts revolution. But at the same time, for the Ethereum and smart contract solidity programmers, having RSK is a great news because it’s the first time that they can get their solutions to be flexible in terms of infrastructure and not only execute their solutions on the Ethereum network, that will soon be forked and move in to proof of state, but also they can secure their solutions with the bitcoin infrastructure : when we reached a hundred percent mining it could be 4 or 5 times more secure than the current Ethereum Network.

What is your background prior to founding RSK?

Gabriel Kurman

Gabriel K: So, on my personal background, I am an economist. I’ve been working in private equity and corporate finance all my life until 2013 when I went to the first Latin American Bitcoin and blockchain conference organized in Buenos Aires by Diego, also co-founder of RSK and some other volunteers, they are currently leading the Latin American Bitcoin Association. Labitconf is a company that has been running for six years and it goes to different country every year. Since then, I’ve also helped in the NGO, organizing these conferences. And it was very clear for me coming from Argentina where we have recurrent economic crisis every 15 years and a long history of devaluation and a capital controls that there is a clear need of renewed financial system that is fairer and more inclusive. Keep in mind that 65% of total population in Latin America, from 200 million people, are currently excluded from the traditional financial system and are in complete poverty. So, when I understood, the potential of Bitcoin as a permission less, long-term store of value, and then understood the potential of programmability of smart contracts that could allow us to build the financial system that processes micro transactions that could reach billions of users, it was perfectly clear : my desire to join the RSK co-founders and build RSK exactly to do that. Join the best security of the bitcoin network with the flexibility and programmability of solidity smart contracts.

What is the relationship between RSK and RIF?

Gabriel K: So, the Rif OS ecosystem or platform is a set of infrastructure services that complete the RSK vision of financial inclusion. So, there are set of very important infrastructure services that are currently available on other platforms, in Ethereum in particular, which we need to be available in RSK in order to be able to reach the billions of users that we are trying to reach, building a new financial system that can reach us all worldwide. So, those services that are included in the Rif OS ecosystem are: decentralized storage, so individuals can store their decentralized ID in a secure manner distributed around the world, for example. Another service is a directory service, similar to ENS that also exists in Ethereum. It is extremely important when you are dealing with the unbanked people that most of them are illiterate so it’s very hard for them to manage public keys. And having the possibility of interacting with an alias. It’s much easier for them not to be scammed and not to commit any mistakes. So, the naming services, and other of the Rif OS infrastructure services, they are being developed on top of RSK. Then we have oracling services. Oracling services will be key in order to have fiat-based fees, one of the main limitations to brought that options of blockchain technologies that in the case of the smart contracts, it is very difficult to predict the cost of the smart contract execution. So, having an extremely secure oracles, we can provide reliable information that will allow the platform to develop its fee at based fee so users can secure or ensure their execution cost related to specific fee at currency based on where you are located. And then, we also have the Lumino network as part of the Rif OS services, and the lumino network keys is our version of Raiden, similar comparable to the lightning network that would allow us to do off chain payments with the up to 20 thousand transactions per second which will be key for those unbanked around the world that need to do hundreds of transactions a month, maybe sacrificing a little bit of decentralization in order to get lower transaction costs and not to be registering every single transaction on the blockchain. And there is also a fifth service that is related to secure communication channels that is also key in terms of securing peer to peer lending agreements on the network. So, those are the Rif OS infrastructure services that are being developed by the RSK team altogether and they will be launched on the RSK network.

Could you highlight why, as a developer, I should execute my smart contract on RSK instead of Ethereum?

Gabriel K: […] I think the most important thing for every single project that is currently working on solidity smart contracts is to be able to have predictability in the future. So, whatever they are working on building needs to be agnostic to the underlying infrastructure where the smart contracts are running. It’s so early in the development of these technologies that we have a lot of questions whether different platforms will be able to scale, whether the Blockchain size will be unbearable, whether the infrastructure will be secure enough, and then you have the technological risks, potential hard forks, and in the case of Ethereum, they have a project of moving to proof of stake that has never been proven to be able to secure significant amount of value as opposed to proof of work that has already 10 years in bitcoin, being extremely secure. So, the first reason why any developer or any project should make their solution available in RSK is to be flexible, to have options and secure their solutions using bitcoin infrastructure and ASIC mining. Overtime, the platform that can provide the highest level of security at a low execution cost, would probably be the one that most people will use but even there will be case where different used cases will use different infrastructure platforms. And the most important thing is that the intermediate layers, the solutions, the dapps can be completely infrastructure agnostic. And just choose the best infrastructure depending on their solution.

On top of that, as of today, I said before with 30% of total bitcoin hashing power, the RSK may not be as secure as Ethereum in terms of “51% attack” cost, and we are in the process of adding the additional hashing power, merge-mining RSK, you need to keep in mind that it’s a no brainer for miners to merge-mine RSK because it is just extra revenue stream for them at no additional cost. And if you see in the RSK gas station, there is a daily comparison on the fuel cost of RSK versus Ethereum and in average we are ⅓ of that of Ethereum, so in the short term, it’s also a much more cheap and efficient to run smart contracts on the RSK manned than on Ethereum.

Tell us about some interesting projects built on the RSK platform/RIF OS?

Yes, so there are multiple projects that have been working on the RSK platform for more than a year. We have la Vivienda for instance, the second largest bank in Colombia that has developed a very simple initial pilot for paying lunch of their employees. But the main purpose of la Vivienda is they are focused on micro lending and financial inclusion is to learn how to use the RSK platform in order to develop their blockchain micro-lending solutions. So, they started by something very simple with no regulatory or commercial risks, now they are scaling the project by providing loyalty solutions to their customers, and then moving from loyalty to financial services. We also had a pilot ran by Kiwi group which is one of the largest Fintechs in Russia. Also, Tajeta Naranja, which is the largest known banking credit card in Argentina. We also have Dex Rate, which is a US logistics company that launched their pilot on the RSK mainnet last week, where they use the RSK blockchain to do traceability.
TEMPCO is a Korean company that is also working on logistics and they are planning to do their bitcoin-backed token offering (BTO), its the way we called ICOs on RSK, basically a token backed by a bitcoin infrastructure that will be launched in the next couple of months. And their platform will allow with that token to do traceability similar to what dexFreight rate is doing. And there are many more projects including loyalty, logistics and there is one project that we’ve been working on for the last 3 years as part of the Latin American NGO which is called System D, it provides financial inclusion in the Argentina slums. RSK is a partner of that project that receive the 1.5 million dollar grant from the Inter-American Development Bank, it’s a project that has been created by Diego manay years ago along with many other volunteers. And RSK will be providing an open source wallets and infrastructure.
But it’s a project that will be again technologically agnostic, so it is open to many different blockchains, but we’ll make sure that one of the solutions is available in RSK, and because this is one as I said before, one of the main goals of the RSK team is to make sure that the technology that we are developing with the bitcoin security is food and to reach our goal : providing financial inclusion and helping to build better and more inclusive financial system.

What is your strategy for 2019?

Gabriel K: So, by the end of this year, we expect to launch on RSK the RSK Ethereum bridge, which will allow projects to lock their tokens on Ethereum and launch the same amount of tokens in RSK, this will be a great tool to make projects very easy to move from one blockchain to the other and make their platforms available on both blockchains at the same time, something that for instance Civic has requested, they want to make their solutions also available in RSK. We also going to launch something that will allow very easily to confirm bitcoin transactions from the RSK blockchain, and this will allow automated bitcoin backed token offerings, or BTOs so we will allow projects in the emerging markets to do crowdfunding automatically, receiving their funding in bitcoin. This is something very interesting that the RSK architecture changes from the Ethereum architecture which is that on Ethereum, when a project does fundraising from crowdfunding, they receive the funding in Ether that was never meant to be a store value and is the platform is fuel, and we’ve seen in recent months that the fuel can be extremely volatile because its not scarce and it’s not immutable and we go through major fork with Casper. In the case of BTOs, or bitcoin backed token offerings, the way it works in RSK is that the project or start-up receives the funding in bitcoin with the store value on the bitcoin blockchain. And then the smart contract on RSK confirms the transaction and sends the tokens on the RSK blockchain which eventually will have the same level of security as of bitcoin due to merge-mining. And we only need to use RBTC or smart bitcoins for a few bucks in order to pay for the fuel. So, this is something that we’ll be launching in the next couple of months.

And then, during 2019, we’ll be working very hard on the Lumino off-chain payment channel which is something very important, you know, to reach the billions of users who are desperately in need of better financial system using blockchain technology and we are also going to be working on the other infrastructure services from the Rif OS ecosystem.

What is RSK’s stand on the BCH smart contract capability (worm hole) and its imminent forking?

Gabriel K: Regarding the questions on bitcoin cash, what I would say is that, we appreciate every single project that is innovating, if their innovation is open source. We like when projects compete in terms of decentralization, security and innovation. And it’s great that we have different options in different platforms, some of them might serve different use cases. So, it is great that the bitcoin cash team is working on that solution. If there is something interesting, we might take it in our platform. The drive chain that we’ve created could also be implemented by the bitcoin cash team and they could run smart bitcoin cash on RSK as well. The idea is that all these blockchains should eventually work together. These will make the ecosystem more antifragile and this is the ultimate goal, I think. All the innovations and improvements that RSK develops are completely open source and available also to the Ethereum community. And everything in improvement that other blockchains are doing, we can also analyse it and if it ends up being really positive, we will take it. What we’ve done with RSK is just taking technology that are being created by other teams, the bitcoin developer community and Satoshi, the Ethereum community, the merge-mining is also a technology that is already available. And the side chain idea from blockchain back then was improved to the drive chain plan that is simplified, more feasible version of it. So, we in RSK are very agnostic and very pragmatic in terms of technology. Everything we build is open source for everyone to take. And we also analyse the best technology available and could be implemented.

Will you work more specifically in some countries, areas or fields?

Gabriel K: Well, in terms of areas and regions, we have around 200 RSK ambassadors distributed around the world, and actually it is a good opportunity to invite everyone in this call to join the RSK ambassador program, it is available in our website rsk.co . It starts with a training program that is completely free, so anyone can do it and if you want, you have an option at the end to certify also at zero cost, and become an ambassador which somehow demonstrates that you’ve been through the process and are knowledgeable about blockchain in general and RSK in particular and the reason why we have so many ambassadors around the world is because the bitcoin communities and meetups around the world are really looking forward to see RSK succeed, because eventually this will increase the value of Bitcoin. So, in terms of regions and areas of our interest, it’s more about the regions and the area where the ambassadors are and how actively they can bring smart contract use cases to their countries and to their cities. All the different solutions that are being developed around the world are available for the ambassador if they want to partner with the companies that created those solutions and bring those used cased to their own country. In particular, we are of course super interested in promoting blockchain technology in RSK used cases in the emerging markets. There are 3 billion people that are currently outside the system, and for them, having bitcoin or blockchain smart contracts is not something else, in Europe, in the US, the benefits are marginal because we all have credit cards, we all can do remittances, we all can buy shares and stocks online or use paypal. But for the 3 billion people that are currently outside the system, this is a life changing technology, and these are the areas in Latin America, in Asia, Southeast Asia and Africa, where we expect to see the blockchain revolution happening. And of course, we are looking forward to hear from ambassadors from those regions and how we can help, in education, in developing new skills locally and bringing use cases and all kind of partnerships to see blockchain technology thrive in those areas where it is needed the most.

Where do you see RSK in 5 years?

Gabriel K: Well, 5 calendar years, actually 35 blockchain years, right? So many things happen every single year in the space that I think it’s impossible to predict and to see where this is going. I believe that the growth and the innovation that is happening in the space is similar to what happened in the early days of the internet and the social media and the social network had been so impossible to predict because there is something off scale when you have billions of users using this technology with some different ideas and use cases become available. RSK will continue working towards its mission that is the developing the technology that enables a better, more fair and inclusive financial system. Once we reached some of these intermediate goals, we’ll keep on working just making the network more antifragile, more decentralized. We’ll be working on full node rewards, that is important for decentralization. We are going to use smart contract fees to reward bitcoin full nodes, and also RSK full nodes. We have 67 RSK improvement proposals, they are all open source and available in our Github for you to check directly. But we are really expecting in 5 years to have really decentralized global community-based projects. We developers and developers from all around the world, building solutions and contributing to RSK on a decentralized basis.

200 ambassadors? https://ambassadors.rsk.co/

Gabriel K: Yes, I think on top of the 200 ambassadors, we have around thousand that are in the process of completing the course and sitting for the exam. Some of them wants it for the exam because it’s not mandatory. Some people just use the course to learn about the technology and not interested in getting their certification. We are really looking forward to get in touch with all the ambassadors and hear the used cases that are needed in every single party ecosystem and trying to connect them with the business partners who are developing those used cases so we can accelerate the global adoption of blockchain solutions worldwide.

Is it possible to do an ICO on RSK? Will BTO create new tokens? Or will be using a unified token?

Gabriel K: Oh, I can reply to these 2 questions altogether. Yes, RSK is fully compatible with Ethereum, so anything that you can do in Ethereum, you can do in RSK. With exactly the same smart contracts and same methods and tools and everything. We are not calling ICOs as a name because we think that the ecosystem has realized and became more mature related to crowdfunding, so we call them BTO as I said before or Bitcoin Backed Token Offerings in order to understand that in this case, the tokens are not secured by GPU, hash empowered by ASIC or bitcoin merge-mining. And yes, you can do as many tokens as you want. The process is exactly the same if you want to do private sale and if you want to do a crowd sale, then you have this situation that I’ve mentioned before that, given that you’re not receiving the funding in the fuel because it doesn’t make sense, what happens in Ethereum, you need to learn how to confirm the transactions on the bitcoin blockchain because you will be receiving the funding in bitcoin to be able to automatically issue the token on the RSK blockchain. So, if any of you is interested, you can send me an email, I can put you in touch with the business development team, which is putting together instruction in order to facilitate how to explain the different projects, how they can do token sale on RSK , a BTO, and issue the tokens on RSK Blockchain.

Will blockchain replace banks in your opinion?

Gabriel K: Well, after the 20 years of the internet, we still have postal services. So, based on that comparison, we can say that there should be still room for banks or banking services if you will. Now the financial services industry will transform completely in my opinion. We probably, every single one in this call, used to spend money buying CDs for music and renting DVDs on blockbuster and now we pay 5 euros per month and we want to have full access to every single song or movie in the planet. Probably the same pattern will happen in financial services. We’ll continue to use banking solutions, but just not willing to pay for them, or having a minimum annual fee, so what I see or envision its financial services with help of blockchain technology and smart contract automation. Moving into this new segment of the market, these 3 billion new users coming to the internet and to the financial services through free internet access and low-cost smartphones that will be demanding social network and financial services. So, only those fintech companies, banks or start-ups learning how to do microtransactions, micro payments, micro remittances, and micro e-commerce when people buy foods in the streets. Those emerging markets are probably going to be the ones helping us build the more inclusive financial system and developing profitable use cases and business models, because those newcomers are the ones that are going to be served by the billions and with very small fees, it could still make profitable business models.

Will we need different wallets to hold the BTOs?

Gabriel K: Regarding the wallet questions, so currently RSK is integrated with mycrypto, ahh, with jaxx, ahh with Trezor and Ledger, so you can store your smart bitcoins, the fuel, the platform or any other token that will be issued on RSK on those same wallets. We will be working on easy-to-use open source wallet also to make it easier. There is a Korean wallet that is also integrated with RSK and I think in the next couple of weeks, also my Ether wallet will be integrated with RSK and once you can store smart bitcoin or RBTC, you can get any other token that is issued on the platform as well using the same wallet. So, we want to make it very simple for users to interact with RSK as well.

Thank you Gabriel it was great having you here, Thank you for your time and your enthusiasm, we will see you in Tokyo on Monday for the beginning of “The Internet of Value Asia Tour” https://startuptoken.com/asiatour

Thank you all for your great questions!

The Internet of value Asia Tour. Powered by Bitcoin, RSK and RIF

Bitcoin set the foundation for the construction of a new Internet for the transfer of Value. Both the RSK Smart Contract Network and now RIF OS (Root Infrastructure Framework Open Standard) were created as means to move this vision further with the hope that the new Internet of Value will foster prosperity and equality around the world.

RSK is the first open-source smart contract platform secured by the Bitcoin Network that is: Bitcoin friendly; secure; scalable and flexible

And RIF OS built on top or RSK Smart Contract Network is a suite of open and decentralized infrastructure protocols that enable faster, easier and scalable development of distributed applications (dApps) within a unified environment enabling broad interoperability and faster time-to-deployment, bridging the gap between blockchain technologies and their mass-market adoption. RIF OS Protocols complete the RSK Smart Contract Network vision of bringing the Internet of Value to life.

Entrepreneurs, developers or enthusiasts, join Diego Gutierrez Zaldivar, the newly appointed RIF Labs CEO, on his new Asia roadshow, led by StartupToken, a Blockchain Startup Accelerator, and be the first to discover the RIF Open Standard Protocols.

About RIF Labs:

RIF Labs operates as a purpose driven organization focused on promoting and developing the next generation of open blockchain-based infrastructure that will enable worldwide financial inclusion and bridge the gap between this nascent technology and mass adoption.

RIF Labs is implementing RIF OS Protocols an all in one, easy to use, blockchain infrastructure service suite that will allow greater scalability and faster time to market for traditional and blockchain developers.

The organization has a growing team of mission driven, passionate collaborators all over the globe and it’s led by the RSK Labs founding team and other top executives that are widely recognized at the forefront of the Bitcoin and cryptocurrency space, actively leading key innovations and community building since 2011.

About RSK:

RSK is the first open-source smart contract platform secured by the Bitcoin Network that also rewards the Bitcoin miners via merge-mining, allowing them to actively participate in the Smart Contract revolution. RSK goal is to add value and functionality to the Bitcoin ecosystem by enabling smart-contracts, near instant payments and higher-scalability.

About StartupToken:

As one of the first global Blockchain Accelerators, StartupToken, an RSK strategic partner, is a portfolio company of Coinsilium Group, a publicly listed VC in the NEX London Exchange, which is dedicated to help decentralized organizations building projects on top of blockchain technologies.

We focus on early stage, seed and pre-seed projects where direct support to founders and creating value post-investment is integral to our business model. The bulk of our portfolio projects include financial tools, social impact, clean energies, and digital asset trading platforms.

Our services include, but are not limited to, startup advisory, mentoring, business & marketing strategy. We also place a large emphasis on Blockchain technology education to entrepreneurs, enthusiasts as well as developers.

For more information and exclusive content join us : t.me/startuptoken