I’m watching many of the full interviews from Manuel Stagars’s short film “The Blockchain and Us“,
One that I was instantly drawn to was with Roger Wattenhofer, who’s a professor at the Swiss Federal Institute of Technology (ETH).
I wanted someone who knows what’s up to whiteboard, or blackboard in this case, how the blockchain works. Wish granted!
His two main ingredients are “asymmetric crypto” and “distributed systems.” If you understand these two things, then you can understand the technical details of the blockchain.
Bonus: He confidently explains that cryptography and distributed systems were created in the 1970s, which is somehow amusing and makes the whole thing much more approachable.
Hats off to Manuel Stagars for his short film “The Blockchain and Us“.
There’s no better way to learn about a multidimensional topic like the blockchain then have knowledgeable people, from different perspectives, give their take on how it emerged, what it is, and what it means.
It’s just 30 minutes long, so dive in:
You hear, for example, from Elizabeth Stark of Lightning (at the 13min, 31sec mark). She says:
Of course success is in no way guaranteed. One day we may look back on this and say, it wasn’t that great. But, if you ask me, I think undoubtedly there’s a huge amount of progress that’s already been made, and there’s something here! I find it hard to believe I’m going to look back in 10 to 20 years and say, oh, none of this ended up happening. We’re really seeing a new way of transacting value on the Internet.
There’s so many good insights in this film. So if you’ve been wondering about the blockchain, here’s your chance.
It’s a little strange that the blockchain, and its tokens, aren’t actually that complex, and yet they can seem that way.
If you’re not careful you can veer off into an area like “mining” that leaves the person you’re talking to confused. It’s true blockchains have a lot of dimensions and depth.
But here’s why they’re simple: Think about the idea of a blockchain apart from any technology.
Imagine a big sheet of paper that magically records the details of two or more people exchanging money (e.g., Cameron sends Andre thirty cents).This magic paper knows the identity of each person.
This sheet of paper is also magically owned, and kept, by lots and lots of people and therefore no one can own it. And it allows anyone to see details about the money that’s been exchanged.
So this big piece of paper magically records the exchange of money between people it can identify, the full record is freely distributed to many, many people, and it’s transparent to all. And because the blockchain system is built this way, it’s highly secure.
A token (or cryptocurrency) is special money used for the blockchain, which is exchanged in this secure and open way. In fact, any type of asset, truly anything of value, can be exchanged on the blockchain using a token.
So in a sentence:
The blockchain is an ownerless, transparent, and highly secure way to exchange and record value.
Laura Shin’s recent podcast on “How To Explain Cryptocurrencies and Blockchains” with Jamie Smith and Amanda Gutterman is a great way to explore why blockchains and cryptocurrencies are inherently simple. Highly recommended.
The blockchain is out there waiting to be used.
But how can you use it to, as the Ecomonist said in 2015, as “a way of making and preserving truths“? I like that definition.
The blockchain potentially offers something radically new because of its inherent ability to make and preserve truth between us at scale.
How do we use it, though? What’s stopping millions of people from using it right now?
Fred Ehrsam gave one very good reason why in April this year, which is the blockchain needs the right elements, or stack, to support the development of the applications that people can use.
His list of elements in this developer stack are computation, file storage, external data, monetization, and payments. He scored these elements in that post and concluded the stack was 20% ready in 2014 and 70% ready in April 2017.
Fred followed-up that post with a more detailed one on June 2017. His feeling is that the blockchain, specifically Ethereum, which is furthest along, is still “orders of magnitude off from being able to support applications with millions of users”.
Yet, there is significant progress on scaling Ethereum, in his view, and we might see an app with up to 10 million users by the end of 2018.
One thing that will surely help this happen is the token aspect of the blockchain. Tokens mean incentives for eveyone.
Fred and Chris Dixon talk about why crypto tokens matter on a a16z podcast.