Is there any chance here? A true blockchain startup story

This article is the eighth lesson of Wanxiang Blockchain Hive Academy's open course. The content of the original blockchain CEO Wu Peng's speech. With his entrepreneurial experience, Wu Peng shared the blockchain industry experience and the entrepreneurial direction of the blockchain.

I started doing blockchain research in 2015. In October 2016, we went online as the first domestic blockchain copyright protection and trading platform. In February 2017, we held a press conference with Wanxiang Blockchain. We are the first team to settle in the Wanxiang New Chain Accelerator. In 2017, we began to provide blockchain technology services and industry solutions for large companies; in 2019, MIKS, a content protection and knowledge protection-based platform, was launched. MIKS is a distributed enterprise information management service platform. Today I will share some of my thoughts in entrepreneurship. First of all, I must first understand what the blockchain is, and then what can and can do with the blockchain. This is the order I want to communicate with you today.

What exactly is a blockchain?

I like to trace the source when researching one thing by myself. I remember the most time I spent watching the blockchain when I was reading the Satoshi Bitcoin white paper. Just looking at the title of the Bitcoin white paper already contains two very specialized pieces of information:

1. Peer-to-peer: For example, peer-to-peer gives a person 100 yuan in the house without going through a bank or Alipay. This is a peer-to-peer operation.

2. Electronic cash: I didn't understand why it was called electronic cash? One time, Dr. Wan Feng Xiaofeng mentioned why it was called cash? Because cash is very special in all financial systems, there is a very important "anonymity". One person was given 100 yuan in this room. No one except this room knew. "Electronic cash" has defined a certain degree of anonymity from the definition.

For many people in the industry, everyone calls it the "ledger revolution". The ledger technology has always been closely related to the development of society. As the productivity has developed, the ledger has been changing. The ledger has become clearer since then. In the first 5 centuries of the industry, a single form of bookkeeping appeared, accompanied by Rome's economic prosperity. Double-entry bookkeeping emerged in Italy from the 12th to 13th centuries AD. Many practitioners in the financial industry said that double-entry bookkeeping was the origin of capitalism. Behind all the economic prosperity and financial activities enjoyed today is the foreshadowing of double-entry bookkeeping.

When we encounter complex cross-border transactions, there will still be many obstacles when settling between banks. At this time, with the progress of society, a newer ledger technology may appear to help business operations become more large-scale and smoother. circulation. A very valuable function of the blockchain is "transaction is clearing". Previously, transactions and clearing were separated, but with the blockchain, they can be merged together.

Let's take a look at the history of Internet technology. The earliest Internet prototype was born in 1969. In 1976, two very famous cryptographers released a paper "New Directions in Cryptography." This paper basically uses modern society. All the technical principles of cryptography covered here are covered. In the same year, the "Denationalization of Currency" was also issued, proposing the concept of non-sovereign currency.

The complete idea of ​​cryptocurrency came out in 1998, and Wei Dai and Nick Saab simultaneously introduced the concept of "cryptocurrency". Google was established in 1998, Satoshi Nakamoto released the Bitcoin White Paper in 2008, and the first version of Ethereum was launched in 2015. In addition to the ledger, the development of blockchain is an inevitable road for the development of social technology, and it continues to advance along the time dimension of technology development. Although "Bitcoin" suddenly popped up in 2008, the earliest rudiment of thought was already in 1976, which is a process of gradual evolution. The products of technological development have very important meanings. Those created are historical missions. Once created, they cannot erase the retreat and must assume the mission. This is an inevitable trend in history.

The development of blockchain and bitcoin is closely related to the trend of the world economy. Remember that everyone said in 2017 that "this year is the first year of the blockchain landing", and then it has not become the first year. In 2018, we still said "This year is the first year of the blockchain's landing", or not, 2019 is about to pass, and 2020 is coming. When is the first year of the blockchain? I have no answer. However, the recent policies will still bring a wave of boom, which will greatly promote the development of the blockchain industry.

When the blockchain was 1.0, Bitcoin was a consensus ledger with memory; when the blockchain was 2.0, Ethereum (so-called smart contracts) proposed the concept of code as law. Code is law is a very good geek dream, but when it comes to landing in the real world, it will encounter obstacles. When there is a problem with the system in a real society, there are legislative bodies and public inspection laws, and there are ways to override the original ruling. But in the digital world, code is law. Who is the arbiter? What if the "law" goes wrong? As of today there is no good solution.

Before the Internet court started to use blockchain technology, I personally think that it is a great boost to the industry. No matter what level the technology is applied to, it is a very important promotion measure to combine the actual social institutional mechanism with the blockchain.

The concept of blockchain 3.0 was proposed very early, but until now I have not seen which one is the true 3.0. Is 3.0 important? It's not important, what's important is who can help the blockchain to do truly large-scale landing applications, who is 3.0.

The lowest level of the blockchain is a distributed network with multiple centers, no intermediaries, high efficiency and high availability. The second layer is the chain structure of the data, which guarantees data consistency and is easy to verify and trace. The third layer is cryptography, and the uppermost layer is consensus collaboration. This is the most essential part of the blockchain, and it is the part that everyone is most likely to ignore.

The consensus mechanism is the best part of the blockchain. What is consensus? When members of a group reach an agreement on a certain aspect, a "consensus" is formed. From national laws and regulations to company rules and regulations, they are all "consensus." The laws and regulations as large as the country and the rules and regulations of the company are all consensus. The biggest benefit is to solve the problem of distrust between strangers. Blockchain has never created any trust consensus. The only thing that can be done is to digitally move the existing consensus in human society to the network, so that all people who have not met and do not know each other can reach a consensus in it. The most famous PoW workload proves that millions of people around the world don't meet each other and transfer an account to Americans, which can be recorded by millions of people worldwide. More work, more work, less work, less, PoW is much like people dig precious metals, gold, and paid labor to get the so-called "currency exchange", so it is more like mining.

After studying the blockchain, I have a more life-like example to understand what is PoW. When I was young, I was always wondering, why should a kindergarten child ask him if he is special? Even some kindergartens and elementary schools have to take parental tests. But then I found this to be a very efficient way. Educational resources in our society are always scarce. Everyone wants their children to receive the best education, but there are so many good teachers and good education resources, and everyone can only compete.

Imagine this mechanism is very, very efficient. If a child plays golf in the first grade of elementary school, it means that the family has the ability to raise the child to a higher level. This is the most primitive and efficient way in society to help us make the so-called consensus, and pick out children who can go farther to receive a better education. This is the result of natural selection, and is essentially a proof of work for PoW.

Everyone thinks PoW is very slow. Many people in the industry say that designing a faster network than Bitcoin. In fact, Bitcoin was not considered slow when designing, and the design mechanism is like this. How to reach consensus faster? PoS proof of equity is the bookkeeping of shares in real life. But once someone owns more than 51% of the shares, they have absolute control. At this time, network neutrality is easily affected.

Someone has invented a more interesting DPoS mechanism, which corresponds to the voting mechanism. The U.S. election is essentially a DPoS mechanism. At the earliest, I thought that the U.S. election was a vote for the president by all Americans. In fact, it is not. It is the voters of each continent who elect the voters (agents), who then vote for who the President is.

Everyone generally knows who the person I want to vote for, but there will be some people in the middle. This has also happened in history. Everyone thinks that he voted for this president, but actually voted for the other party. This is also a relatively efficient mechanism that allows hundreds of millions of people to reach consensus. The people's congress system is essentially the mechanism of DPoS.

Looking at the blockchain from a purely technical perspective is very simple, but if you research consensus, you will find it extremely complicated. The consensus mechanism is a very low-level mechanism for maintaining trust.

How to distinguish good blockchain projects

1. Is it a distributed network? If it is only a single node of the blockchain built by the company, it is not a blockchain.

2. Is there a solution to the problem of trust? The cover of The Economist magazine in 2013 said that blockchain is a trust machine, and it is not a good blockchain project if it does not solve the trust problem.

3. The public ledger, the ledger must be related to assets, and all valuables and assets can be recorded. This is an important feature of assetization.

I told all my friends that using these three points of judgment, whether it is a combination of AI, big data, VR, and other complex things, is useless. Let's see if the lowest level features are useful.

At present, blockchain cannot be used purely as technology. The most important thing is to apply it in business scenarios. What is business? The typical process of business behavior is: multiple parties to a transaction determine a commercial contract through negotiation and complete the transaction by executing the contract. The blockchain is good at how to reach a contract between multiple parties and ensure the smooth execution of the contract. It includes trustworthiness, reduces costs, and enhances security. Therefore, the innovation of the blockchain is the product of trust and value.

Is the blockchain decentralized?

Now many people say that the blockchain is decentralized. Now I need to help you clarify the most basic concepts of the bottom layer of the blockchain, which will help us understand what we do with the blockchain. This picture is the one I use every time I tell others about the blockchain.

As shown in the figure, there are three network topology structures. Which one is a decentralized network? Many people say that it is the third one. In fact, the second one is the decentralized network. Why is the second decentralized network? How did the structure come about? What are the differences between these three networks?

The first is to remove all the dots in the middle. What is the difference between the second and the third? The second and third networks are both very multi-node networks. In the second graph, we try to go from the left node to the following network. How many intermediate nodes need to pass? It takes 3 nodes to get there. Looking at the third graph, how many nodes need to go from the bottom left corner to the bottom right corner? Need to go through a lot. What does this mean? The third network must be the most robust, but its efficiency is not high, and it is not efficient for all nodes to be connected together.

I am studying network science and will involve complex science. In the physical world of the world, all naturally formed complex networks are all intermediate architectures (decentralized architectures), because such architectures are the most efficient. But seeing the intermediate network will not misunderstand what decentralization is, because there are still centers in the decentralized network. There are many central nodes. The existence of central nodes is to ensure network efficiency.

Decentralization is the result, not the purpose. In order to ensure the maximum efficiency of the network, the network will naturally form a decentralized network in the process of natural growth. This is the result. If I want to design a decentralized network, I personally think that this concept is wrong. The central node is needed at the local microcosm of the network, and it cannot be played without the central node. Everyone thinks that Bitcoin is by far the most classic blockchain application. Does Bitcoin have no central node? Yes, there are many mining pools, and mining pools are very large central nodes. So a network without a central node is unrealistic.

Can the blockchain talk about de-intermediation?

I don't know if it is de-intermediate, but the word is not included in the Bitcoin White Paper. The "Bitcoin White Paper" emphasizes peer-to-peer (P2P) and does not emphasize the need to go to intermediaries. There is a sentence in the last paragraph of the "Bitcoin White Paper" called "Do not rely on trust." Everyone says that blockchain is a trusted machine, but why is blockchain a trusted machine? The essence of the blockchain is to transform the original trust model in traditional business into a cryptographic model. This is the essence, which means that the same problem must be solved at the bottom between the cryptographic model and the trust model, so the cryptographic model can be used Replaced by the trust model.

Talk about a most typical cryptographic model. How did underground party members pass secret information during the War of Resistance? Here's a book for you. How do you know the message? There is a password table, which can be found in thousands of words, and it is very efficient. This is the essence of the blockchain replacing the trust model with the cryptographic model. The help of cryptography for trust and society is very, very deep. If you pursue it carefully, you can study a lot of things, and everyone can study it carefully.

Is it better with or without an agent?

Let's first look at the role of intermediaries. Intermediaries use professional knowledge to provide professional services and good experiences, and use probability theory to resist risks in transactions. However, the transaction cost will not decrease in theory, only transfer. For example, if you buy a house, you may be cheated if you do not understand the house. All real estate related information acquisition requires costs, so if you use an intermediary, you just pass the cost to the intermediary, but it has not actually decreased.

Today, it seems that we are using the blockchain to improve efficiency, but in fact, we are passing the cost on to the person who built the blockchain network. He paid the cost, so the cost of the blockchain has not decreased but just shifted. Intermediaries are mainly responsible for the cost of trust, which in many cases will translate into specialized costs. Intermediaries often turn professional knowledge into trust costs, turn them into professional experiences, and generate a certain service premium. If the intermediary is removed, it means that both sides of the transaction have to bear the cost of specialization inside. If you are a professional trader, you can choose to trade peer-to-peer in a "professional" way. If there is no professional knowledge, it is more suitable to choose an intermediary with a very good experience to help you complete a very good trading experience, while reducing the risk.

Is the blockchain intermediary? De-intermediation is not the most important. What is important is what is to be achieved and what to do. To build a network based on this premise, neither decentralization nor de-intermediation is considered. Maximizing efficiency is the core and most intrinsical.

Is blockchain technology difficult?

There are difficult parts of the blockchain, and the mechanism design is more difficult. Blockchain has a certain degree of difficulty in engineering. The earliest graphene architecture was built by an engineer. Today, finding an engineer in many technology companies may take a day to build a demo of the blockchain network, but it is stable. Does it run for a long time? Can you guarantee that all accounts will not be wrong in the next three years? Doing this is not just a simple demo, it will encounter a lot of problems.

Two or three months ago, a friend asked me if I still do blockchain? I said still doing it. He said what project are you doing now? I said what I did on the first day and what I still do.

Many people who do blockchain do not start from the industry, they do it for the purpose of doing blockchain. Blockchain must empower the industry. Since it is an enabling technology, we must first understand what the essence of the industry is and where the problem is. I started to study the application in the copyright field in 2015. It went online in 2016, and it took me two years to get everyone to accept that blockchain can be used as a copyright concept. There are now a lot of central media and financial media. Work with us.

Everyone says that the blockchain is a trust system, but the first problem encountered when doing business with the blockchain is the business problem. People don't believe you. The first threshold encountered by the trust system is distrust, which is very interesting.

Practitioners in many industries should not worry. You need to know what the problems are in the industry. Only after you understand them can you know whether the blockchain can solve them. This is a good project. Why the blockchain has not really landed in the past few years, the important reason is that practitioners in the early blockchain industry were technical geeks. They have no experience in commercialization, so they will encounter many problems when they are in business , So we must find a way to embrace the industry and do in-depth combination with the industry.

Non-industry people should not be too deified and awed by the blockchain technology, as if it seems very complicated. Industry practitioners should not lose their awe in traditional industries, because the essence of the world is business. No matter how advanced technology is for commercialization, the bottom layer is inseparable from the essence of commerce, so it is still necessary to understand what commerce is to do.

Will blockchain make the world a better place?

Technological progress is inevitable for social development. Blockchain technology has been discovered / invented / created. It is bound to find a matching scenario to serve the society. Everything has two sides, both good and bad. But if we are the pioneers and innovators of the industry, we must accept the places where we may step on the pit and the places where there may be risks. Only by holding a dream that can make society better, otherwise, if you encounter some problems, you can't push the industry forward. No matter what the technology will be, industry practitioners must have the dream of making society better, and we strive to do that.

I have always told the team that what we have to do is to help the general public, parents and children to see good content and valuable content in the future. This is my purpose. Such goals support me to continue, whether it is blockchain or other technologies.

Another interesting application scenario is derived from this thinking. We have made a judgment after doing a long time of blockchain research ourselves. In fact, the ideal scenario of the blockchain is not the To C scenario, but the To B scenario. We help the society identify and screen information. Can we help companies? If an enterprise / organization is regarded as a living body, is such a whole and system landing information efficiently? Therefore, we use blockchain technology to build a distributed organization think tank system that can help organizations solve trust issues, help organizations obtain information more efficiently, and allow information to flow efficiently within the organization, which can help companies achieve innovation.

The concept that has been more popular in recent years is "open innovation", which allows information to flow in and out of organizations and boundaries freely, which can create more possibilities for enterprises to flow information and exchange information. Many industries need horizontal development. At this time, information needs to be connected with each other.

I want to ask everyone, if the boss of the company throws the question in the WeChat group, is everyone eager to answer it? no. I have considered using corporate WeChat in the enterprise before. I found a small area to apply for a period of time and found that it didn't work. The employee did n’t open it, just watching the push. The essential problem under such a structure is that the company has no trust, there is no trust between employees and bosses, and there is no trust between employees and employees. If there is no trust mechanism, how can information flow at a high speed, and how can innovation be made without high-speed flow of information.

The earliest products were made only to solve the problems of their own team. After more than half a year of use, they found that internal information exchange was leaps and bounds. Many talents were thinking like a spring, and felt that they could be commercialized to help other companies. So now it has been commercialized. There are many large companies using our products to solve internal collaboration and pan-IP issues. This is our business idea. All the starting points are to solve problems.

To share with you my blockchain entrepreneurship story, the most essential thing is to have two points: (1) really understand the essence; (2) what are the needs? Address your needs. This is the essence of my commercialization and business innovation.

Many people in the industry now talk about the accelerated design of the secondary network, but the design of layer2 was done in 2016. The industry often uses very high-level words to confuse everyone. In essence, it is cache. The computer world has always been Both have caches and are never new. The CPU has a cache, an internal disk has a cache, and there are caches everywhere. To complete efficient tasks, you must do so.

Our products have to face many international customers, and the domestic version is stored in the original certificate. The international version of the deposit certificate is made on Ethereum. We have made a layer of accelerated network. All the information so far is no problem.

Solving problems based on needs is the essence. Don't blindly follow the technology and direction, because others may be wrong. Finding the real problem makes it possible to find a solution. When you ask the right question, your problem is half solved. The core is to find the problem to be solved before deciding what to do.

When you understand the problem, your uncertainty has greatly converged, and the certainty has been greatly enhanced. This is the essence of the blockchain-"reducing uncertainty".

I hope my sharing today is helpful to everyone, thank you!