RChain Co-op Is Building Blockchain Infrastructure For World Interoperabilitybr>
One of the current problems facing the blockchain community is the lack of interoperability and an issue with scaling. RChain is working on solving the problem. We talked with Jacob Bassiri-Tehrani about this burgeoning technology.
BLOCK TRIBUNE: From what I can parse from what you sent me, this is about multiple blockchains that’ll scale. Tell me how that works.
JACOB BASSIRI: Yeah, so you’ve picked up on a key design feature of RChain, which is concurrency. To pull it off, you need a programming language that’s tailored for the blockchain in a multi-blockchain system, and your question is, “What does that look like?” It looks like someone in India who’s selling milk on the corner of the street or at a store, that transaction gets registered on a blockchain that doesn’t necessarily …
It’s not necessarily the same blockchain as people selling equities on Wall Street, but the blockchains are able to communicate with one another, such that the person who just sold milk and received a coin can turn around and buy a stock on Wall Street on the other side of the world, and in that case, those two unique blockchains communicate and make sure that the coin is not fictitious. It is verified. Why does that make sense?
Well, if you know anything about bitcoin and ethereum’s issues today, they are essentially serial ledgers, and by serial, it just means exactly what the name blockchain kind of connotes. It’s a chain. It’s a one link connects the next link, connects the next link, and people talk a lot about sharding, which is going to be part of any long-term solution, but it’s only a small part, and it’s tough to even do sharding really well. There’s a lot of talk of ethereum implementing it.
Vitalik came out in Devcon3 and said his plan needs a level scale within three to five years. He’s already delayed it from what his projection used to be, and actually, RChain’s design is kind of inspired by Ethereum. We don’t down upon ethereum at all. We actually work with some of their developers collaboratively, and the design of Casper Proof-of-Stake thought it was specifically …
RChain was specifically designed with the limitations of ethereum in mind to try and achieve what had been my interest from my recent time in the space, because I only got into it in May of 2017, my interest very quickly became … It was obvious this is going to change the world over the course of my lifetime, but how are we going to get from beyond the first 500 thousand or one million people using this to getting to seven billion people around the world using it and solving a ton of poverty?
We’ve done a great job over the last 50 years getting poverty down in the world, but there’s still a ways to go, and I really think that if we can nail down money and distribution of money in an equitable fashion around the world, then we have a chance at making the world a much better place. That’s kind of the inspiration behind the leadership of RChain, and it’s amazing that they bring so much technical acumen to the space and they’re still 100% committed to that decentralization vision and idealistic goal of helping to improve the world.
BLOCK TRIBUNE: Let me stop you there. This is a tool for developers? In other words, they can add it to their existing chains and then they’ll be able to communicate with multiple chains, or is it something where they’ll have to scrap what they’re doing and adopt your methods?
JACOB BASSIRI: That’s a great question. It’s both, but I’ll clarify what that looks like. RChain itself is a stand-alone platform. It’s just like Ethereum, you could say, but we firmly believe in a rich ecosystem and multiple blockchains. When we see that, we also see the need and we’re planning for the tools that you just referenced.
What those tools do is, I can’t say it will allow people to stay on their blockchains because ethereum has some critical limitations, but what it will let them do is make it easy for them to eventually migrate onto RChain because you kind of need the infrastructure that Rchain is building to get to, let’s say, Facebook scale. If you want to create an application that hundreds of millions of people are literally on at the same time and they’re doing things on the same time on that application, Ethereum’s architecture can’t do that now.
Honestly, when it gets to be the level scaling three to five years, these are level scale is not the scale of Facebook. It’s going to need to be even bigger than that. It’s both, and the tools are going to allow for people to migrate eventually. Ethereum is great, but CryptoKitties is clogging up Ethereum. It’s a game. You heard of that?
BLOCK TRIBUNE: Yeah.
JACOB BASSIRI: Yeah, so I think the folks at CryptoKitties, the way it would look is they hear about RChain, they say, “Oh, this is cool.” They start testing it out and then they say, “Wow. Okay. What are the developer tools that are available to me to help transfer my community?” Make it easy for their customers.
The customer shouldn’t see a difference in what blockchain they’re using, but eventually, that’ll look like also … Their customers will end up trading their ether for REV, which is going to be the platform currency of RChain because if you are running on RChain, you’re going to need to be using RChain coin, but for the user experience, they could still be using the website of CryptoKitties. You know what I’m saying?
BLOCK TRIBUNE: Mm-hmm (affirmative).
JACOB BASSIRI: Yeah.
BLOCK TRIBUNE: You will be able to mine those coins they take in on this new blockchain?
JACOB BASSIRI: The mining system is one of the inspiration of RChain, and the main point of collaboration that we have with ethereum today, I wouldn’t call it mining because it’s a proof-of-stake system, so we call it “verification.” I guess there’s a good reason why. One of the main reasons to use the word “verification” instead of “mining,” is because of getting away from the oligarchy of Bitcoin and a few big miners controlling the tower of the system, and the other point is the electricity cost and the expense of handling Bitcoin today.
If you imagine a system scaling to a size a thousand times bigger, mining, I think it will end up having, and it maybe already has a little bit of a dirty connotation, like I love coal miners and I want them all to have jobs, but if it’s going to pollute the environment, it’s not good. Bitcoin mining, I think that term isn’t going to last 10 years from now, I don’t think. What we call verification and it’s done not via traditional proof-of-work, which is what Bitcoin and Ethereum does today, but something called proof-of-stake, which is what Ethereum and RChain are working on together.
What proof-of-stake looks like is you basically put up some coin as a bit of escrow to help verify transactions. If you take some coins out of circulation and for investing in that block verification process, you earn, let’s say, an interest rate. The key is it’s not related to computational tower. You’re saving all that pollution and energy, and it’s a more distributed system. Even someone like you or me who doesn’t have the money right now to invest in a bitcoin mining farm, we just on our normal computer could participate in some way, shape or form in the rewards that come from RChain verification.
That’s, I think, one of the super key points because I think the way you scale blockchain to get to global proportions, to billions of people using it, is you find a way to get coins in people’s hands who don’t have money. I can’t say everyone’s going to be rich because if everyone’s rich, then the money has no value, but we’re going to bring more people into the global financial system on one coin. The way you do that is … It’s an ambitious feat, but if the barrier to verification is low, that means the barrier to earning a small interest rate is low, and in fact, it could be a zero also.
Part of the verification requires, like I said, you put up a little bit of coin that you have, but there’s another form of it that requires putting up nothing. You just get some for being on the system. That’s a great way to onboard people. I’ll tell you one thing, when I got into Bitcoin or into the blockchain space in May, it was largely due to the fact that Bitcoin was pushing past 1,000 dollars and showing on the CNBC a lot.
For me, I never got around to buying any real amount of bitcoin. I definitely have never bought more than 100 dollars of bitcoin. It was just an experiment for me the first time. I never bought it. How can I buy a piece of something? Listen, I am, thank God, middle class America. Imagine the 99% of the world that’s disenfranchised. They’re not going to ever buy bitcoin. How can they afford that?
Bitcoin’s not going to be the one to bring everyone onto the same global financial/economic system. Again, we don’t look down at Bitcoin at all. They’ve pioneered the way. Every coin has had its time in the spotlight. I really think the next spotlight coin will need to be able to work at scale.
BLOCK TRIBUNE: Okay. Let me ask you this. What you’re proposing will really depress virtually every coin that’s out there in price from wherever … If your solution really takes off at the beginning, then every other coin is going to drop in value because less and less people are going to be using it for transactions, correct?
JACOB BASSIRI: No. No, I think the same thing you see with the Bitcoin and Ethereum phenomenon, I see it coming out in a similar way. Let me explain what that means. I see us growing an organic, devoted, developer and investor community that’s sees the real value of bringing sale to the blockchain. As our community grows, and our price will continue to go higher and continue to climb up the list of coins, we will be a reason for other coins to continue to go even higher, because 99% of the coins out there are promising a blockchain application that if realized, and it brought to fruition, would require a platform that works at higher efficiency than Ethereum today.
While you have a lot of, call it 100 good ones, let’s say. There are thousands of coins. Let’s there are 100 good ones that have raised tens of 30 million dollars to develop an application on Ethereum, but CryptoKitties is clogging the blockchain, right? If any of those with good use cases and music and product verification and anti-fraud and payment and supply chain, if any of those come to fruition, you’ve got to imagine they’re going to be using more of the Ethereum blockchain than CryptoKitties.
Right now, the industry is facing, I think, a challenge. We’re all investing on faith that someone will figure out how to implement these great visions. Right now, we’re all hanging our head on Ethereum. Honestly, that’s fine, but they’ve already delayed expectations to three to five years from now. RChain’s plan is to get to where they plan to be in three to five years by the end of 2018. We’re extending a lifeline to all these companies, I think. I think, actually, the value of all the other coins should continue to go higher.
BLOCK TRIBUNE: What will be your biggest challenge? Will it be technology or will it be marketing or something else?
JACOB BASSIRI: I think we’re in a really exciting place because our team is really devoted to formally verifying the technology. Before, we’re implementing the masses and checking out. This technology vision is led by Greg Meredith, former Microsoft Chief Architect from 1997 to 2004. He worked on BizTalk process orchestration, which was basically an enterprise version and precursor to what blockchain is. When you think about what those words mean, BizTalk, business talking process orchestration. Businesses needed a way to share information in a synchronous way.
Now, that was before the blockchain frenzy, but it’s great that this stuff has been cooking in the back of Greg’s brain for so long. Then he also worked with the Ethereum guys before he decided he needed to do arching from the ground up. The tech, I feel good about. The business and marketing, because of our close ties to the Ethereum community, Vlad Zamfir, who’s [inaudible 00:16:55] on the names page at Devcon for the last three years right alongside Vitalik, he is on our board because he’s learned a lot and gained a lot from the mentorship of Greg Meredith from a technical standpoint and trying to implement proof-of-stake to Ethereum version.
We have a lot of goodwill, but I think, honestly, business is one of the things, promotions, having people know about us because our tech leadership is very, “Let’s not promote ourselves. Let’s let it happen organically, and let’s wait till the end of the year when we’ll start to get on different exchanges.” That’s why we’re not even on any top 50 exchanges except for one. We’re only on one exchange, and it’s called Q Coin. People have heard of it. It’s not a nothing exchange, but it’s not a top 10 exchange.
On the business side, it’s kind of by design that we’re flying under the radar because we don’t want to over-promise, under-deliver. Like I said, our guys are developing based on the math, and they’re led by the Microsoft guy, and we have four Googler’s on the team, three PhDs. I’ve gotten to know these guys over six months. I’ve flown to San Francisco twice. Greg has been in my office in New York. They have open calls once a week, so I’m getting developer updates every week. I feel really confident that by the end of the year this thing will be running.
The long-term development plan includes five iterations. Let’s say over seven to ten years. Like Windows 95, Windows 98, because eventually we want this stuff to be running on everyone’s mobile phone. That’s how you crack the poverty crisis. That’s how you get people in Africa to be able to earn some coin just for running it on their phone. The first technology at the end of this year will probably still require a computer. There’s going to be a few iterations of this.
I think promotion and business is part of it. The third thing I’ll say is partnerships, development partnerships. We’re having good conversations with people who want to create music, distributed music application, distributed exchanges like EtherDelta that we’re not specifically talking to them, but we’re talking to another [inaudible 00:19:36] European exchange that needs better technology to handle more transactions per second. There are entrepreneurs coming out from the woodwork all looking for a platform. Yeah, I’d say the business-
BLOCK TRIBUNE: How does somebody get involved with your company? Say they buy into your vision and want to get on board. What do they need to do?
JACOB BASSIRI: We have a “How to contribute” page on our GitHub, and it really walks you through our reward system because we’re really all about the community, which is another thing I love about Greg’s vision about Rchain. He really believes it’s by the people, for the people. His motto when he got all this started is E pluribus unum 2.0, which means, “Out of one, many,” and it’s on the dollar bill, as we all know.
It’s not for any random reason that RChain is a cooperative, and there are members of the cooperative, and we run the show. Obviously, with a lot of deferent to technical leadership and the board who manages day to day decision making. There is an [essentialized 00:21:09] reward system where anyone around the world can propose an issue, whether it’s presenting at meet-up or contributing a new website for a translation of a paper to enter the documents into a new language and a new market.
All these things can be issues that are assigned a budget, and you get a few people to vote on that budget. You just need three people to agree or to vote on the budget, and it gets passed for that month. Then you assign the rewards of the budget based on how much of the work was executed to whoever worked on it. I could say, “Bruce, you get 50% of the 5,000 dollar budget for public relations in January 2018,” so you get that reward, and someone will email you, and they’ll say, “Do you want to be paid in rock, bitcoin, or ethereum?”
I don’t know. Maybe you could also get US dollars. I’m not sure. You’ll get an invoice. That’s the way to really get involved, and we’re excited to get rocks out into people who are excited about the project and want to promote the projects, want to work on the projects. If you’re a developer, there are developer bounties, and there’s a different link for that, so if you want that, let me know. Then the last thing is there’s a public discord where you can voice your opinion on governance matters because, again, this is a cooperative, and we get input.
There are three committees. There’s an executive committee, a governance committee, and a compensation committee, and we’re actually having a conference in Seattle, which we would love more people to come join us on February 15th, 16th, 17th, 18th to discuss our way of governing ourselves, and blockchain governance in general because it’s been such a hot topic. Actually, this conference was really inspired by Vlad Zamfir, who I mentioned, who’s an Ethereum researcher but who’s on the board of RChain.
I’m really excited that he’s so passionate about governance because it’s one of the things that keeps me up at night. It’s like, “Who is in control of all the coins and who can decide to make more coins, not make more coins?” Most of the blockchains have a few founders and that’s it. Really, the cooperative makes a lot of sense.
The last thing I’ll say is every year, and we’ve already had our first one of these, there’s an annual membership meeting in October. We had our first annual membership meeting in October 2017. It was October 24th, again, in Seattle. I flew out there. We had about 30 people. We livestreamed across the world. We had, I think, seven or eight issues up for vote, and you could vote in person or you could vote remotely because, obviously, we have a big community supporting us.
BLOCK TRIBUNE: Let me stop you there. That’s getting a little deep in the weeds for my purposes. You’ve had an ICO already, correct, on this?
JACOB BASSIRI: Not exactly. We’ve had two private sales.
BLOCK TRIBUNE: Okay. How much money did you raise? Are you talking about that?
JACOB BASSIRI: Yeah. The first time we raised 10 million dollars in September. Then just before the end of the year, we raised another 15 million dollars. The first 10 is worth 30 now, and the [inaudible 00:25:24] probably the amount of funds that we have to back us right now is probably 40, 50 million of liquid assets. That’s not including the rocks that we hold of our own coin. If you include that, it’s a lot more, but I’m not counting that because our coin is still … It’s newly valuable, I’d say. It’s really on the way up. It’s just starting to become on the …
BLOCK TRIBUNE: Are you going to have an ICO at some point or not really?
JACOB BASSIRI: Yeah, it’s possible. The membership will vote on that in October 2018 most likely, and if we do it, it would be in January 2019. On our own platform, it would be, and it would … We definitely want to get more coins out into the community, so whether or not it’s called an ICO or there’s a method that gives coins to members of the cooperative or to sell them at different prices over several months, it’s up … There’s active community discussion about how to get more coins responsibly into the world.
BLOCK TRIBUNE: What is your background? What were you doing before you got involved in this in May?
JACOB BASSIRI: I have an interesting background. After Cornell University, I went to NYU Medical School. I did a year and a half of medical school before taking some time off and then going to Harvard Business School. After Harvard Business School, I started to get involved with entrepreneurship. My passion was the intersection of medicine and business, so I was entrepreneurial within the New York Medical Marijuana space.
I learned a lot and it was a great experience. I went back to med school, actually, because it didn’t take off for me, and then six months into working in the hospital in medical school, I decided even though it was the best experience of my life, it was nothing like working in a hospital with patients and doctors. Business is more my calling, so I left and started looking at Biotech and healthcare startups. Did that for two years, but didn’t really find lasting success in that.
The lease on my apartment was up. I took back my security deposit and moved back home with my parents at 28 years old. Not bad. I loved living with my parents. It has its pros and cons. Then I started looking at blockchain space in May of 2017, and the first call I had with Greg Meredith and Ed Eykholt from RChain, I was literally in my bedroom facetiming with them and a couple other of my investors.
From there, I thought … Everything I learned, I was like, “Is this possible? Is this too good to be true?” Then over the course of the last six months, I invested once in the first sale, and in the second sale, I actually spearheaded the second sale because I believed in these guys so much. We wanted to invest five million dollars in these guys. Then in a Shakespearian tragedy, I was not allowed to invest, but people from all over the world invested up to 15 million dollars.
Now I understand why I was excluded from the last private sale, and I don’t hold any hard feelings. I’m still very close with the team. It was just the compliance regulatory issue, and I like that our legal team plays everything on the safe side because this space it not very regulated right now. The government can come out and come out with rules and then get people in trouble, but we feel like we’re steering very clear of regulatory harry issues.
Anyways, I’ve been mostly active in business development, community building, getting team members excited about this, bringing people from my network to the project, and I invested the first time in the private sale and spearheaded the second 15 million dollar fundraise, which they weren’t expecting to do, but I started the snowball effect around that.
BLOCK TRIBUNE: What is your title there?
JACOB BASSIRI: I actually don’t work for them. Like I said, it’s a co-op. We could all join and be members. I’m a co-op member.
BLOCK TRIBUNE: You’re sort of an evangelist, in other words, an ad hoc evangelist. Okay.
JACOB BASSIRI: Yeah, ad hoc evangelist. Perfect. Yeah.