As CEO of The Onli Corporation, a blockchain pioneer, I get asked that question a lot. Here is how I see it.
The last few decades have seen the rise of the World Wide Web and the resulting Open Data Economy. This has had a profound impact on human life. The internet is a network of copies and the web is a network of documents. Even though it was invented not that long ago. It is hard to imagine a world without the internet. Believe it or not, there was a time when there was no internet, no web, no mobile phone, and it really wasn’t that long ago. The Open Data Economy, the world of data around the web, changed everything. The same profound change is about the happen, again.
There is a lot written about blockchain. Few people really get it. Most don’t even know what it is about. Crypto and Distributed Ledger Technology is what most people know, which is the by product of blockchain. Blockchain is a technology. Blockchain has become a valuable buzzword. You want to add a few points to your stock price, just add the word blockchain. Blockchain is a way of storing data. Blockchain is not going to save the world.
There is a revolutionary change happening. It’s not about crypto assets. It is not about finding the Next Greater Fool to pay more for something than you did. The blockchain revolution is about something more fundamental. There is a real shift in the nature of information and it will have a profound impact on how you use technology.
The central commodity of the Open Data Economy is information: Websites, Photos, Files, Email, Comments, Conversations, and applications that create and share this commodity. When you send someone an email or a photo what you do is send a copy. When you access a website or view a post on social media, what you are doing is making a copy. Making copies, is literally, how the Web works. Now I want to draw an important distinction here. The Web is not the Internet. The Web is a network of documents. The Internet is a network of computers. They are two very different things. Making copies is a paradigm that works very well for information.
However, there are some forms of communication where this paradigm will not work well. Think stores of value like assets: things like financial assets, like money, stocks bonds, commodities, etc. Even things you don’t think of as value like loyalty points, your vote, these kinds of values don’t work well if you can make a copy. If I sent you a copy of a $10 bill and I keep the original, that doesn’t quite work.
In 2009, a group of researchers under the pseudonym Satoshi Nakamoto proposed a way to use the Internet to solve this problem. The idea, philosophically speaking, was to create a ledger, where entries in the ledger are stored as a chain of blocks. Each block would include the hash of the previous block, making it challenging to forge entries in the chain of blocks. This is blockchain. Naturally, the question then arose of how do you keep the ledger safe. The solution was borrowed from the open data economy in that you made lots of copies of the ledger and maintained its integrity through consensus. Ledgers require a lot of computing power. So how do you incentivize people to lend their computing power to process transactions and keep the ledger? This, in my opinion, was the real innovation. What they came up with is a scheme called mining, where those who maintain the ledger would compete in a mathematical contest, and the winner of the contest get to a key, a string of alphanumeric numbers, for an entry in the ledger, which can be used as a unit of account. This is a bitcoin. Miners can then sell this unit of account, which is divisible and fungible. The result is you would have a transaction ledger with immutable entries, distributed among lots of computers and maintained through a consensus. Anyone can store a transaction on this global ledger in a way that can’t be changed. Nothing happens without infrastructure. Infrastructure is provided by a sharing scheme, which replaces any single central middleman. Bitcoin was the spark that lit the fire of blockchain.
In 2010, a small company Cloudmode in Las Vegas was working on the problem of what we defined as uniqueness quantification, which is a mathematical way of saying there can only be one. Uniqueness quantification is an attribute of physics that we take for granted. Hold two rocks in your hand. Even though they are identical in every way. There is still only one. You can throw one rock and hold on to the other. We made a breakthrough in data science that makes it possible to create a capsule of data that maintains a real-time, single global state, across a network of connected devices. What that means is you can create something, store it and move it around, of which there can only be one. We were developing this technology to the solve two problems: the problem of identity, you are you and no other, and the problem of control, what most people think of as security, in a cloud operating system. A cloud, as we use it here, is where multiple computers work together to appear as one computer. We came from a finance background, and once we saw the bitcoin paper, we understood that this wouldn’t scale elegantly and it wouldn’t work for storing certian kinds of assets. In 2010 we developed an alternative, which is the use of the Onli technology in finance. We called it ONLI.
Onli is your NON-DLT blockchain. Here is how it is different. There is no ledger. Onli is a piece of code, not a private key. Each Onli is it’s own, individual, blockchain. Every Onli has an owner. Ownership is recorded in a transparent registry. It is not anonymous. Onli’s are transferred directly from person to person via a private network. Onli’s are kept in a Vault. Not a wallet. Onli’s are minted not mined. No mining means that it’s scalable. The value of an ONLI is programmed or “minted” by an Issuer, and the Issuer operates a marketplace for their brand of Onli. There is always someone, responsible, guarding the network. This means it fits within most regulatory environments. Onli’s are fast and final. There is no risk of forking or hacking. Onli is original code built on patented technology and has been reliably used since 2012. All the benefits and none of the problems.
Bitcoin — distribute the ledger, Onli-distribute the coin, these are just two approaches to this new communication paradigm that is blockchain. There are more coming.
Think of the concept this way. There are three paradigms for communication represented in technology.
- The Web- a place to share information that is ok if you make a copy of it.
- Blockchain — a place to store information in a way that cannot be changed, in a word immutable.
- Onli — a way to store information, move it around and keep it safe in a way that is immutable, meaning there can only be one.
They don’t replace each other. They compliment each other. The Web is a public world. It has to be. The core idea is a computer publishes the directory it wants to share to a network of computers. In order to build a private world you needed to start over and build a technology stack from the bare metal up.
The Open Data Economy, the Web, gave us great companies like google and amazon. It gave us lucrative business models, free software that aggregate micro-work. Micro-work has created, what one could argue, is the most valuable commodity there is today, open data. In the Information Age, data is more valuable than oil. This was all possible because data was public-by-default. It has to be because that is the nature of the technology that it was built on, the Web. However, all of this is only one continent in a larger world.
There is a second age coming. An era where data is private-by-default. A technology for a communication paradigm; things you want to share without making a copy of it. The old business models from the Web, won’t work in this new space. This is a new world. What is interesting is that the business models of the real world, where uniqueness quantification is an attribute of physics, works really well.
Our thesis is that the Internet of Value is not going to be built on the Web. The Web is public-by-default. You are going to need new technology, new tools, new code, a new way to store data, move it around and keep it safe. All built from the ground up for the new business models of a Private-Data Economy. This is what we are about. The Private Data Economy is where you can store something, share it, move it around, and control it because there are no copies. It is a new space on the Internet where there can “be” only one.