Harmony Blockchain’s Deep Sharding Might be the Winning Decentralized Architecture

Harmony is BUIDLing the future of scalable public blockchains that can democratize automation

In the world of memes, I’m all-in on this. Move over HODL, it’s time to BUIDL the future. I think about the future of technology on a daily basis, and this includes how artificial intelligence, blockchain and the 4th industrial revolution with exponential tech will create a better world.

Part of that grand narrative for the 21st century involves decoupling human productivity like work from money. What we call ‘money’ and ‘work’ in even twenty years will be radically different.

One of the key points about how automation scales is how basic income mechanisms will protect us in the transition. What if blockchain tech and a new architecture could do that?

It’s counter-intuitive at first that the best blockchain architecture would enable global citizens to monetize their own data. It turns out high TPS and ZK (Zero Knowledge Proof) might enable it to happen sooner than we think.

Harmony

Can Data be a Universal Basic Income?

The future of blockchain might be tied to a basic income.

Anyone who has read content on one of the main publications I run, Utopia Press, knows how passionate I am about universal basic income. I’ve talked to dozens of people working at the intersection of blockchain and UBI. It’s an exciting pioneering field.

Currently, it’s impossible for an average person to benefit from the personal data that we create due to lack of infrastructure that streamlines the validation and disbursement process of monetizing our data. Much as Facebook wants to create an internal private stablecoin to monetize WhatsApp, we probably need entire new platforms to decentralize how this might work.

Currently one of the best bets for this is a blockchain startup I’ve featured before, called Harmony.One. Their motto is “Open Consensus for 10 Billion People. Harmony for One and All.” They want to create an open infrastructure with bells and whistles such as revolutionary high-throughput, low-latency, and low-fee consensus power decentralized economies of the future. What I didn’t know is they were embracing basic income ideologies.

So while Andrew Yang gains support for a 2020 elections run based on this sort of thing, these guys are actually building the open platform of how this might work. That’s sort of a big deal for anyone that feels uncertain about the future of the global economy.

Harmony Architecture

What one has to remember here is Harmony has got the brightest engineers. We are talking about a blockchain startup that has already raised $18 million in seed funding with a team of ex-engineers from Google, Amazon, Microsoft and Apple.

How blockchain is related to how Data could become a Basic Income

Public blockchains bring something that was impossible to the realm of possibility.

  • Blockchain provides a layer that automates impossibly tedious tasks like validating whether a person’s data has been used or not
  • Through low transaction cost and transaction automation, blockchain is able to disburse even smallest transaction amounts to everyone in the world without the need for a 3rd party to handle those transactions

Harmony is BUIDLing it — the solution that is!

There are 2 main components that make Harmony the perfect vehicle for providing Universal Basic Income through Data.

  1. Deep Sharding — Harmony’s unique way of sharding all the way down to the blockchain networking layer (Exponentially faster than the traditional way of reaching consensus on a blockchain)
  2. Zero Knowledge Proof — allows people to validate whether something is true without revealing the full data.
  • For example a company will be able to find out what your income is (a very intrusive question to reveal), not by asking the exact question but by doing something like a range query where they’ll give a range of income bracket that you might belong to and get an answer back in the form of true or false.

On the privacy-centric encrypted internet of the future (Apple and Facebook are already pivoting), there’s room for public blockchains to change how we relate with the future of data, content and incentives on the internet. Public blockchains are likely to be more trustworthy and global citizen/consumer friendly versions of how this plays out.

  • Harmony wants to create a scalable marketplace for the decentralized economy. In the future of cryptoeconomics, there’s room for a Silicon Valley led player here.
  • In blockchain just like in any other kind of startup, you need to follow the talent to project who will be the “winners” in their space.
  • Given Harmony’s engineering focus, funding potential and vision — it’s a decent bet for how blockchain might solve the some of the challenges of the future internet.
Stephen Tse (谢镇滔) | Harmony
After working on large-scale infrastructure projects, some with hundreds of millions of users, at both Google and Apple, I was ready for the next adventure. — Stephen Tse (interview with HackerNoon).

One of the main co-founders, Stephen Tse (谢镇滔), was a researcher at Microsoft Research, a senior infrastructure engineer at Google, and a principal engineer for search ranking at Apple. That in a nutshell is the kind of pedigree that I want to see from a legit blockchain startup.

Blockchain is more Trustworthy than Corporate Walled Gardens

Harmony wants to create a data infrastructure layer that can be shared among everyone in the world. It’s an open platform but on the blockchain, and essentially is something Facebook could never replicate.

So here and in this way the average person does not have to build Google or Facebook in order to benefit from their data, rather they can do so with minimum effort and without completely exposing themselves on the internet. This, if all goes well, is a bit like Silicon Valley 2.0, a new frame of reference of what the internet could become.

Why a radically fairer economy accessible to everyone in the world Matters

  • The world we know isn’t the same world our children will experience.
  • Smart machines, robots and machine learning will start replacing our jobs, work and incomes. It’s a no-brainer, they are precise, they are fast and they don’t get tired (and they don’t unionize for a higher minimum wage).
  • According to this report by McKinsey, robots will replace up to 800 million jobs by the year 2030.
  • The global economy of the future needs to account for things like automation, rising student debt, a shrinking labor pool and a ballooning health care cost due to an aging population.

I write a lot about the wealth gap, so forgive me if I’m repeating myself here.

The Old Internet is Increasing Wealth Inequality

Let me just break it down in easy to read chunks:

  • The wealth gap is bigger than ever. According to an analysis by the Pew Research Center, the top 1% holds 38.6% of the nation’s wealth as of 2017, which is up from 33.7% in 2007.
  • Our personal data has been harvested, monetized and micro targeted for Ads with companies (such as Google, Facebook) getting bigger and bigger with more powerful lobbying too.
  • Instagram embracing checkout E-commerce directly in the app might give Facebook an extra $10 Billion in profits and will be even more invasive on our data.
  • Amazon is expected to become a major advertising force in the next five years and continue to build their own entertainment ecosystem that will pivot into healthcare and disrupt more and more industries.
  • These companies and others are building incredible infrastructure to monetize individual components, like our personal data. As individuals that don’t have the access or capability to build an infrastructure of that scale, we have no access to the benefits of the data that we create.

Many Millennials and GenZ global citizens don’t and won’t have the disposable incomes to invest in the stock market like generations past. A new wave of companies on Wall Street have incredible debts and aren’t even profitable and Wall Street does not care. Yet Big Tech will continue to buy out other companies, creating even more formidable components of capitalism where the monetization of our data is out of our control. All of which increases wealth inequality and hastens a potential cannibalization of the American Middle Class.

If Bitcoin is the new gold, data is the new oil. Or maybe Data itself is the new gold. It is estimated that both Facebook and Google generate over 85% of their revenue from Ads. That’s 85% of 46 billion and 136 billion dollars that these companies generated in 2018.

The Future of Data as the New Oil

What’s happening now? Huge ecosystems of customers (like Apple’s) and users (like Facebook’s) are going to pivot to a walled garden version of the internet focused on privacy, data security and so forth.

Unfortunately the Ad-centric paradigm dominates in a surveillance capitalism spearheaded by Facebook and Google’s duopoly. So for all intents and purposes, in 2019 through the recording and selling of your data in the form of advertisements (the rules of the game currently), these giants continue to grow bigger and bigger (almost exponentially). The data markets don’t stop there. With the smart home, smart speakers, the evolution of IoT, the data being generated from your home and the objects you own (from devices to wearables) will create a monumental market in the future.

What’s the alternative?

  • Smart contracts could scale to a global level.
  • The centralized Internet could be disrupted by more decentralized models where profits are more evenly distributed.
  • By decentralizing access to these tools at scale, people around the world can create innovation that we haven’t yet imagined.
Harmony

Decentralization As a Movement

This is where my own philosophy of futurism syncs best with Harmony. A grand vision requires engineers capable of BUIDLing it. The Harmony for One and All theme here actually makes sense. It makes more sense to see the forest for the trees. The 2020 elections aren’t likely to change the narrative for how we conceptual the future global economy, but blockchain might. Decentralization-as-a-movement, people.

The future of data sharing needs to be more decentralized, giving people more control and benefits and revenue share. I think that’s a fair world we can all aspire for together for the future of techno-capitalism.

However, as an average person, there is no way to benefit from the personal data that we create due to lack of infrastructure that streamlines the validation and disbursement process of monetizing our data.

We need to decouple data as a well-kept treasure for the rich or the 1%. We need to disrupt inequality and change the rules of the game. Otherwise we will remain trapped in a surveillance capitalism prison for decades as the internet goes further and further off course.

Can Blockchain Help us Reclaim our Data?

Blockchain has many use cases but how we manage our data is increasingly one of the most incredible ones.

Imagine trying to identify who needs your data, packaging the right data for them, creating a pricing for your data package, negotiating on the pricing, validating if the data has been used or not, and getting paid once the data has been used. In an automated world that’s more decentralized, blockchain would do this for you while you keep the “rights” to your own data and how it is used.

Blockchain will Automate the Monetization of our Data

I’m not a technical person but the way I conceptualize it is so simple it’s silly. Basically the Blockchain will automate the impossibly tedious tasks and processes of monetizing one’s data. It’s really that simple.

In Harmony’s terms this could consist of:

  • Minimizing transaction costs: blockchain will be able to handle the sale of smallest amounts of data and still leave a profit for the user
  • Smart contracts: the transparent and automated nature of smart contract use will be able to validate the usage of data and be paid for it the moment it happens without the involvement of a 3rd party
  • Automating Trust: the Blockchain could here act as a base layer data storage with functionalities to make the transaction of data seamless so that different UI can be built on top depending on the needs of the buyer

It’s worth noting that Microsoft could implement this with LinkedIn if it wanted to. I’ve seen the schematics for such a feat. It’s doable. LinkedIn is the 25th globally ranked and 9th U.S. ranked website in the world according to Alexa. However corporations like Facebook, Amazon, Microsoft, Apple and others have little incentive to build this. Obviously they are the profiteers of the current system. They are no longer innovators but conformists and have little incentive to truly help the internet move forward with decentralized innovations.

Public blockchains have much more potential to actually bring something new to the internet.

Wouldn’t it be ironic then if a Silicon Valley blockchain startup disrupted the ill-fated version of the internet G-MAFIA companies themselves created? As a futurist where it’s my job to be a social critic of technology companies, the irony would not be lost on me. Blockchain startups have the unique challenge of not just building a new technology but winning the hearts of crypto investors and later, the world.

Harmony’s Vision is People Friendly

Harmony is, after all, a San Francisco based blockchain startup, consisting of former members from companies such as Google, Amazon, and Apple.

It’s just intuitive that people should manage their own data. The idea that corporate entities — who are being investigated, who don’t pay their fare share of taxes and have monopoly status (and all the lack of fair competition that entails) — should be allowed to own us, our content, creations and data for profit is, I’m pretty sure, a bad thing for people and the internet.

That’s why blockchain should be embraced for all the good it can bring.

Picking through Harmony’s Medium presence, it’s easy to see essentially how they are creating the technical basis to be a solution and vehicle for providing Universal Basic Income through Data. Clearly this won’t be their main use-case, but it is something I think that will appeal to global citizens and potential investors.

A Deep Sharding solution is definitely required to have a fast enough network that has the capability to hold massive amounts of data, quickly confirm and validate the use of data and disburse incentives accordingly on a global scale.

On the road to third generation blockchains, there’s been a lot of hype around layer 2 innovation:

  • Layer 2 tech (Ex. Lightning network)
  • Changing consensus method (Ex. Proof of Stake)
  • Introducing a whole new tech (Ex. Sharding, eg. Zilliqa)

To overcome the huge bottleneck for scalability and speed, a radical innovation and improvement needs to take place.

Deep sharding | Harmony
Harmony (via WeChat)

What is “Deep Sharding”?

The Harmony team has come up with a term called Deep Sharding. This implies something different, by not sharding just the transactional layer but going a level deeper to shard the layer where consensus happens.

Through Harmony’s Deep Sharding approach, participating nodes are able to securely find the nodes that are relevant to the specific transaction and involve them in the consensus process.
  • Participating nodes are able to securely find the nodes that are relevant to the specific transaction and involve them in the consensus process
  • The number of transactions achieved per time frame will increase and thus increase the speed at which public blockchain can operate.
  • This level of parallel processing will achieve a scale and speed of blockchain that has not been possible before.

The Zero to Hero of the Future Internet Requires Zero Knowledge Proof

People are going on the western internet with aliases now, we’re changing our names in apps and going behind privacy walls. In a many-walled garden or heavily isle internet, in a data-driven world, how would we add value without sharing exact personal information?

Harmony aims to solve this dilemma through an innovation called zero-knowledge proof. Zero knowledge (ZK) proof allows people to validate whether something is true without revealing the full data.

Think of it like the next-gen of encrypted data for data portability. Okay, that’s probably a terrible analogy but Zero knowledge proof essentially allows people to validate whether something is true without revealing the full data.

After the Crypto Winter

In the crypto winter we need to pick new winners. As you do your research and I do mine, I want blockchain startups that have a vision which disrupts completely how the internet is so wrong today.

You know, it’s pretty obvious, the average person does not have to build Google or Facebook in order to benefit from their data, rather they can do so with minimum effort and without completely exposing themselves on the internet.

Harmony wants to and, more importantly, has the ability to create a data infrastructure layer that can be shared among everyone in the world. When we think of the decentralized movement and how it could impact a world of smart machines and automation, we need to find new alternatives for the economic pressures we know are coming.

Blockchain adoption continues and it is increasingly pointing to future solutions.

Our approach is to productionize a blockchain platform that shards smart contracts while preserving security and full decentralization. — Stephen Tse (谢镇滔) | Harmony
Harmony

Why Should you care about Harmony’s Vision?

So for me personally, the sheer amount of engineering talent in the team and the timing of both Facebook and Apple pivoting to a privacy-centric walled garden approach and the rising basic income narrative — as the “economy” becomes the probable front-burner issue for the 2020 election — positions Harmony at the right time and place (with the right people) to tackle this in a cohesive way.

  • Talent
  • Timing
  • Vision
  • Funding

There’s no real call-to-action on the future of the internet, but in an era where we are debating if we should break up internet companies, or how much taxes they should pay, or the long-term costs of having their HQs in our cities, it’s time to wake up and think about the future of the internet more seriously. With 3rd generation platforms in the pipeline like Harmony, Cardano, Dfinity, Qtum, Nervos and others, public blockchains are still refreshing in their potential. Harmony’s vision however to me, is the most relatable of the bunch.

Why Harmony is Appealing as a Blockchain Startup

Harmony, to me, exemplifies the best balance between mainstream vision, decentralization focus, and Silicon Valley VC credibility. Harmony already has investors such as Lemniscap VC, Bca Fund, Btc12, Consensus Capital, Continue Capital, Hayek Capital, Hm Capital, and Univalue Associates. It’s a more valid projection of the future of the startup than, say, how much they would have raised in an ICO. That era is over.

After I initially wrote about Harmony, I was contacted by Li Jiang 蒋犁, and actually met him randomly when he was on a trip to my hometown of Montreal. I probably have a few Harmony engineers on my WeChat. They likely snagged 20+ global angel investors and crypto funds, and for what they are building that’s a safer bet than an ICO. The timing of their maturation just as Big Tech is pivoting into privacy is, frankly, uncanny.

The LinkedIn analogy and the basic income of data use case are quite pragmatic ways of looking at how public blockchains could scale with a use case that can impact global citizens in a significant way and the global economy.

Harmony could be an Underlying Architecture of the Future Internet

This I think is the key point. Harmony would not directly pay people for their data (unlike the Medium-Stripe way we monetize our content here), rather Harmony serves as the underlying architecture for a user-owned internet — an internet not monopolized by the duopolies of the world (China also has a notable duopoly).

A world of multiple cryptoeconomic layers means we get to choose which “internet” to participate in.

How does Harmony create the infrastructure for an open internet? Harmony provides a key piece to realizing this vision of an open internet: a secure and scalable blockchain protocol. It’s really a valid alternative to G-MAFIA companies going all walled garden, private stablecoin and ultra encrypted on us.

A world of multiple cryptoeconomic layers means we get to choose which “internet” to participate in. Do I want to remain in Facebook’s “family of apps”? Do I trust Google or Amazon? If not, there should be alternatives. I’ve already spoken about how the Chinese internet is a valid alternative. What public blockchains could create is even more contrarian. Harmony is so cool that it could be an anti-Facebook alternative. I’m not going to lie, I like that very much!

Forgive me if gambling dapps on EOS don’t exactly excite me. With Harmony, the secure blockchain is seen as the root upon which everything else can be built. In such an open platform, decentralized storage, computing platforms and decentralized applications create a new universe. While we wait for Ethereum 2.0, the first-mover advantage begins to dwindle.

It’s 2019, what does open consensus for 10 Billion people even look like? I don’t know. But I have a feeling one day we are going to find out.

Harmony
Our founding team felt that we could dramatically improve the scalability of blockchain by innovating at every layer — at the consensus, network, and systems layers. That was the beginning of Harmony. Stephen Tse (谢镇滔) | Harmony

Harmony is Ultra Low Cost

For scalability, a low cost of transactions is essential. Decentralized applications (DApps) can only reach world-wide adoption if the underlying blockchain upon which they’re built is scalable and ultra low cost. I’m not sure TRON or EOS will make much sense when things like Harmony and Dfinity evolve.

In an ideal world, decentralized applications (dApps) flip the current paradigm of data monopolies on its head. But that kind of blockchain adoption might take significantly more time than many crypto enthusiasts assume. Just as hardware was necessary for deep learning to advance, scalable blockchain tech is required for deep sharding to manifest a better open platform.

Wealth Equality Begins with Data Equality

In the G-MAFIA world a select few companies hoard data about their users which they aggregate across a suite of applications they provide. As regulators, lawmakers, politicians, shareholders and consumers begin to change their behavior to acknowledge that pyramid, new systems and platforms will be ready to take their place.

There’s little point in talking about a basic income if it doesn’t include new tech like blockchain, decentralization, machine learning and how tech services are becoming like public utilities. If data is the new oil, blockchain at scale is the architecture of a smart capitalism aligned with the 4th industrial revolution that is aligned with values of global citizens.

The future is just yearning for solutions that would be able to scale decentralized to promote more wealth equality. Data ownership on the blockchain is a pretty intuitive use case here.

Our data needs to be something more than just data which sits within a G-MAFIA company’s walled gardens, passively creating those companies revenue without any benefit to an internet where we are the product. We deserve better than what first-gen Silicon Valley created. This is why we are leaving Facebook or LinkedIn for greener fields, leaving Wall Street itself for crypto possibilities.

Harmony

Are Dapps the Future?

  • Dapps allow users to maintain control of their own data and use it at their own discretion.
  • Dapps remove that central authority that previously was necessary to operate internet services before blockchain, the exact businesses that now operate these massive extractive data monopolies.
  • Dapps enable blockchain to take its place as primary on the internet to rebuild the trust that has been imploding since at least 2017 with how we perceive Big Tech.

What would it even feel like if we as users had sovereignty over own data? I wrote 800 articles on LinkedIn for free. Then I wrote 800 articles on Medium and earned nearly $44,000. That’s not even all of my data, just some of my content.

Essentially a decentralized marketplace means in the future we’ll have the freedom to sell our data to others, who will then use our data to train their models in ways we have fully agreed upon.

Data is already extremely valuable and will only become increasingly so as the world of machine learning and AI grows.

All that makes us human in a machine intelligent world, our language, data and creativity will be monetized in a way that will directly benefit us. The sharing of personal data and the payment for said data by an online retailer, news website or advertiser can all happen natively on what the Harmony blockchain will become.

ARPU and Harmony

Think about it, Facebook’s average revenue per user (ARPU) in the US is roughly $27 per quarter. Think about how that scaled over the years.

Facebook, 2018. Yikes! We were good products for Facebook’s Ad business.
  • New cryptographic tools such as zero knowledge proofs (ZKPs) will enable the sharing of highly sensitive data without compromising privacy
  • The amount our data will be monetizable will likely still fall short of a salary that someone could live on. (Same with the $1,000 bonus some are proposing).
  • Better data rights and monetization essentially means a more vibrant “sharing-economy” with many layers all complementing the consumer’s real humanity and creative participation in society.
  • Where I think I most agree with Harmony is that we are living in an era where surveillance capitalism could scale further into data slavery. We basically need to free our data and redistribute the wealth and power in a more decentralized future.

Data in the 4th Industrial Revolution

As the data market grows bigger and bigger (expanding into Health, Food, Skills, Location) and so many sub-verticals that don’t even exist today or are just in their infancy, how data as the new oil and a basic income tether together will become clearer.

As data streaming takes shape in a 5G world, and as AI streams & Big Data matures, time is running out to create an internet where we are in control of our own data and monetize it for the social good of the planet.

Summary and Conclusion in the Big Picture

As of 2019, the Harmony Team are likely the most sophisticated team I’m aware of that are working directly on this. This is also because the UBI crypto startups have less talent, access to funding and engineering focus than this team.

In a world of IoT meets blockchain meets AI, the entire way we experience the internet and online to offline (O2O) journeys will be fundamentally transformed. There deep learning and deep sharding will be working together to benefit people, and not just corporations. In such a world AI will be more regulated, and centralized companies in capitalism will be better regulated. Much has to happen for this to actually take place, but that’s the secret of the future — the market gets to decide the ethics and architecture of the new capitalism.

A system of capitalism and democracy worth trusting again. A version of the global internet where decentralized layers give us back our freedom, control of our data and a world that values wealth equality and treats users and global citizens with a smarter data layer infrastructure where our human rights aren’t stripped in a surveillance capitalism but augmented with blockchain.

Meanwhile, Harmony aims to BUIDL an open infrastructure blockchain architecture with revolutionary high-throughput, low-latency, and low-fee consensus platform designed to power decentralized economies of the future. Give this article some momentum if you think that’s a future worth envisioning & supporting.

What starts in a garage, doesn’t stay in a garage forever. The decentralized internet is coming.