What happens in Zug…
Tradeshift was in Zug for the Techcrunch blockchain event. Gert Sylvest from Tradeshift Frontiers participated in a panel on what blockchain will entail for supply chains in the future.
A strange crowd
It should be no surprise to an observer of the Ethereum environment that the core Ethereum developers are a quirky bunch. Not exactly your usual kind of stage material, they brandish their strange t-shirts and throw meme references randomly into hard technical talks. They’re so young that they make millennials seem old.
It’s eerie, because the Techcrunch crowd is full of investors, startups and long-established companies. They are here knowing full well that their fates are somewhat intertwined with what comes out of this loosely-knit crowd of modern-day wizards.
Because there is a fair amount of wizardry going on here. By today, we have technology that allows you to send funds truly anonymously, we can prove things in “zero knowledge” (for instance: that we have a driver’s license without revealing our name) and it all runs on decentralized technology that is open for everybody to participate, experiment and develop with.
What goes on here matters
It is in this crowd of unlikely superheroes and almost-magical technological tricks that we find ourselves discussing what the world will look like in the future. Because for those who know, blockchain technologies stand to have a tremendous impact on the world in the future. This is why Tradeshift Frontiers was started, and this conference was case in point.
In a short few days, the audience heard about instant messaging platforms that nobody owns, the end of the computing cloud providers, how to address human rights violations in the most-overdocumented civil war in Syria, that in the future everybody will make our own passport, and the new quality of “digital scarcity.” Early adoption technologies are often focused by “bad” applications — when we invented cryptocurrencies, it was seen as a tool used by gangsters, illegal drug dealers, etc — but blockchain holds much larger promise.
Please remind me: what was blockchain again?
It’s a set of technologies, based on cryptography, that removes the need for parties to trust each other (say, companies in a trade relationship) to come to agreement about transaction history. E.g. “The shipping company said they delivered on the 19th, the buyer acknowledged receipt on the 21st, and the buyer paid the seller on the 25th.” The crux is that it’s no system of man that ensures agreement (“I’ll pull you off to court if you don’t pay!”) but rather some stone-cold technology.
What’s happening in Ethereum?
Much focus lands on scalability and the conversion to proof-of-stake. While the two problems — sharding and Casper — used to be considered separate, they are now more and more being assembled under the term “Ethereum 2.0.”
It turns out that sharding stands to gain from the introduction of Casper. It provides finality to transactions, and this allows shards to synchronize on state availability. This observation has caused plans to move around so that Casper is likely to get deployed first (incidentally, proof of work is looking more and more grim these days).
Taking some of the scalability pressure off the Ethereum mainnet is Plasma, which is almost ready to ship. Indeed, many of the projects shown in Zug are anxiously awaiting Plasma’s arrival. Plasma promises very high scalability of sub-chains, “blockchains of blockchains.” Crucially, however, the sub-chain inherits the security of the mainnet.
The learning problem
Ethereum is also looking inwards: while cryptocurrencies and blockchain technologies are great and all, too few people know about them. Notably, cryptocurrencies were introduced as “everything you don’t understand about money combined with everything you don’t understand about computers” in John Oliver’s episode about them.
Karl Floersch thus is starting a course under the name cryptoeconomics.study. It’s an open-source course, and is focused on getting more people able to participate in the technology creation process.
MakerDAO + Tradeshift = <3
That’s all very fluffy and hard to grasp. In the midst of it all, there was an announcement of a partnership between Tradeshift and MakerDAO.
We’re proud to announce our partnership, and are happy to see it well received. Many projects in the blockchain space — indeed, in the conference itself — are looking to have real-world impact, and our collaboration is one that moves blockchain closer to the “real world” outside the cryptocurrency craze.
Government in a blockchain world
The real world is a different matter, though. In one of the fuzzier talks of the meetup on Saturday, Vlad Zamfir talked about the challenges and opportunities in governance for blockchains. Blockchain has some interesting properties to it: it’s often quoted as “build unstoppable applications” and there’s something to it. Once a smart contract has been “put out there” no government, group of people or technologist can take it down. Yet, there have been exceptions where the community chose to go in another direction, most notably Ethereum itself chose to bend the rules in the story of the DAO.
This breaks open the question of how and if we want to allow humans to govern blockchains: is it even something we should be able to? Is it like a backdoor into encryption, or is it a necessary component of a system by humans, for humans? Zamfir argues that often doing nothing isn’t the most socially scalable (e.g. the DAO bailout), but if blockchains will have ways for courtrooms or other institutions of man to order changes, then there’s also a social scalability problem: whose law? Will the US accept a change required by a Chinese court, or vice versa?
Zamfir argues that this presents a problem, but it also presents an opportunity. Current international organizations don’t hold much power — if any one country doesn’t like an international trade or environmental agreement, they can unilaterally choose to pull out of it — and blockchain solutions can do better than this. The agreements would be very specific, and faster to experiment with than the current system of international law. We can obtain new ways of stably interacting across continents with faith that we all agree on the rules.
Thus the promise of blockchain: trustless — which, in spite of how it sounds, is actually a good thing — systems that allow entities to interact reliably across jurisdictions and cultures. At Tradeshift Frontiers we intend to be the gateway that helps bridge these new technologies into the existing world of B2B.
