Wang Xiaoliang: Blockchain ends Internet "wool comes out of dogs, pigs pay" model

By Wang Xiaoliang

Editor / Zhao Xuejiao

At the time of the change of old and new, Zinc Link invited industry leaders to discuss the development of the industrial blockchain 2.0 era, explore the integration of blockchain with other technologies, and the path of landing in the industry, and promote the industrial blockchain from 1 to 100 historical processes.

This article is Wang Xiaoliang, the co-founder of Xita Technology, thinking about the trend of technology integration:

• BCH levies a 12.5% ​​compulsory tax on miners sparking widespread discussion: Who will support the development team?
• Dialogue with Zhu Ning: Digital currency is an inevitable trend
• There are now 784,000 Bitcoin addresses holding more than 1 BTC. Will this affect the price?

In the late Qianlong period, the rise of national capital, commercial transactions increased, material transactions between commercial ports became more frequent, and the circulation of money between ports increased greatly. On the other hand, rapid population growth, inadequate land supply, and repeated natural disasters have led to the looting of cash, which has to be accompanied by darts.

Lei Lutai, a member of Dapu Village, Pingyao, Shanxi, was keen to smell the business opportunity. He added a bill of exchange in Xiyucheng Pigment Bank where he worked, instead of cash, and also exchanged money.

Li Daquan, a villager, and Lei Lutai hit the mark and created a ticket number.

After that, you don't need to carry a large amount of cash when you go out to do business, you only need to use cash to exchange for cash at the local place, and then go to the same ticket number in another place to exchange for cash or directly trade cash.

Lei Lutai knows how to make money. The ticket number gets bigger and bigger, and the operation lasts for more than 100 years. Its founding number, Ri Shengchang, is known as the founder of China Modern Bank.

First, create a new world

180 years after the founding of Rishengchang, the Internet bubble has just burst, and the number of Internet users in China is close to the 100 million mark. With the continuous improvement of Internet speed, online shopping has become fashionable.

But this invisible method really made netizens love and hate. Money first or goods first or money first, a series of issues such as quality and after-sales are blocked in the face of the rising tide of life.

In 2003, the B2B trading platform Alibaba invested 100 million yuan to establish a shopping platform Taobao.com and set up Alipay the following year to provide transaction guarantee services and solve the problem of clearing money and goods. At the beginning of the new year of 2020, Alibaba's U.S. stock price exceeded $ 600 billion, making it the most influential group in China.

In 2009, an anonymous person with a pseudonym Satoshi Nakamoto, perhaps because of dissatisfaction with the existing financial system, launched a peer-to-peer cash payment network. Bitcoin, as an endogenous currency issued by the network, reached a market value of up to 326.5 billion U.S. dollars. It has survived to this day without the maintenance of a specific organization.

In 2015, the Economist introduced the value of blockchain technology behind the Bitcoin network with a cover of "Blockchain: A Trusted Machine".

On October 24, 2019, the Political Bureau of the CPC Central Committee collectively learned blockchain technology. After that, a new round of upsurge in the application and practice of blockchain was launched in China.

Rishengchang, Alipay, or blockchain. By unifying the dimensions of various process operations, while creating a "new world", it has created great value.

How do I exchange silver tickets at different locations when I exchange them? Ri Shengchang's approach is to coordinate the accounts of various places through the total ticket number, and to match the silver ticket with the current silver in the internal account book.

After receiving cash in one place, you can increase the issuance of silver bills on the ledger; when the silver bill is accepted in another place, reduce the inventory of cash in the ledger, and at the same time record the amount of cash owed by the issuer, that is, liquidation . At regular intervals, the total bill number is used to coordinate the expenditure and income of cash in various places to achieve settlement.

The current silver represents the funds of the physical world, and the silver ticket represents the vouchers of the ledger world. The digital changes on the ledger have realized that the physical logistics and transaction funds flow operate in the same dimension. The ledger is this new world.

In the online shopping process, the seller displays the goods on Taobao, the buyer places an order, pays to Alipay, and the seller delivers. The buyer confirms that the goods are received without special quality reasons or other problems, and Alipay will pass the cost to the seller.

Goods, funds, and business are implemented within the same dimension in Taobao's business system. The Alipay Taobao business system built on the Internet is this new world.

The Bitcoin network created a global crypto asset that was not issued by a central bank. Through the calculation of "consumption", miners dug out a bitcoin. The Bitcoin network records all bitcoin ownership and transaction information, and any amount of bitcoin holders has the key to change the owner.

The difference between Rishengchang's ledger and Taobao is that after the transfer of Bitcoin, instead of increasing or decreasing the balance in an account, it changed the owner of Bitcoin assets.

The transaction of Bitcoin has realized the synchronous completion of clearing and settlement, and the clearing business flow and the settlement capital flow are operated in the same dimension. The Bitcoin network built on the blockchain is this new world.

 

Information and funds operate in the same dimension

The new world brings more possibilities. In his book "A Brief History of Humanity", the Israeli historian Yuval Herali described that the biggest difference between humans and animals is that human beings have imagination.  

It is such an imagination that, with the help of the new worlds of Rishengchang's ledger, Taobao Alipay network, and blockchain network, information and capital operations that did not exist in the same dimension have been realized.

These new possibilities may include: merchants pawn holding silver tickets as cash, even if there is no ticket number in the local area, because the silver ticket is attached to the credit of the ticket number;

When traveling abroad, we can provide ant credit scores for face-to-face treatment, because ant credit represents the personal credit history of its users;

A single individual can build an open platform on the blockchain technology to do insurance business that originally required extremely high credit, because the payment logic is publicly visible and the credit ability can be verified.

These tools for creating a new world are abstracted into: a mapping gateway, a acceptance gateway, a ledger and a calculator.

The mapping gateway is a ticket number, an Alipay company, an on-chain device or institution … It records the information we are currently in in the new world.

The acceptance gateway is the ticket number, is the Alipay company, and is the acceptance institution for digital assets. It returns the value or information in the new world to the physical world.

The ledger is Rishengchang's books, Alipay's database, and blockchain data. The calculator is the bookkeeping method, the business logic of the database, and the calculation logic on the chain.

Three or three ghosts

However, three "ghosts" are still wandering in the infrastructure for building a new world that has appeared since nearly 200 years ago.

The honesty and self-discipline of the Mapping and Acceptance Gateway is the first "ghost".

At the end of the business, Ri Shengchang was unable to recover the loans that had been released.

In 2019, most companies in Internet finance have entered a period of retirement and transformation.

The mismatch between the profit-seeking cost and the cost depends on the constraints of the person or the system. Before the huge economic value, the mapping of information had problems. False silver tickets, false items, because the cost of doing evil is just one input.

Executability is the second ghost.

When it comes to key interests, people often find that the agreed logic or action has stopped. Monitoring often fails at critical moments and should be refused when repayment is due. The digital execution switch is controlled by a single subject.

The third ghost is the governance of data, the misuse of information.  

People's time is more and more stuck in the new digital world, where data describes where we are, what we use, and what we love. In the physical world, when we get home and close the door, we can be quiet. But there is no such home in the digital world.

The value we create in this world is also difficult to protect. It is only necessary to click the mouse and keyboard to be violated. The cost of extending the value is much higher than the value of being violated.

Data needs to be decoupled from services

Blockchain may be one of the keys to solving the above problems.

Information in the blockchain world is still derived from the physical world (PoW public chain may be an exception). However, once the information is entered, the cost of these tampering denials can increase significantly. Over time, people can choose to trust the data provided by the mapping gateway with higher credit.

At present, the government and large enterprises see this opportunity, and use their own good credit to input information into the blockchain. Trusted hardware and IoT devices will be more accurate than manual records and operations under the conditions of good physical conditions and correct environment. Such a mapping gateway can also improve the authenticity of the information entered on the blockchain.

Executability is the foundation of efficiency. In the English proverb, there is a golden sentence of "Justicedelayed is justice denied". Smart contracts in the blockchain can be understood as deterministic Alipay, which can make some basic execution more effective. Certainty. Of course, the logic described by incomplete language still needs human judgment.

The migration of human civilization from the physical world to the digital world seems irreversible. While people are entering instructions into the digital world, the algorithms of the digital world in turn affect us in the physical world. The boundaries of data and the boundaries of authorized representative privacy do not seem to be well resolved in traditional systems.

After the identity is identified, it is used to carry the service. The data generated by the service is retained by the service provider. The Internet wool model is paid by dogs, making the Internet's business model into data monetization.  

Change is imperative. Although the GDPR law has been created in Europe to restrict the use of data and information, compared with the first two ghosts, the third ghost has not yet reached the level of collapse of the Internet foundation.

So, what role can blockchain play in data governance? There is a prerequisite here, the data needs to be decoupled from the service. When the data generated by people is not stored in the service provider, then people can control the autonomy of the data. Blockchain can attach data to our different identities and delegate or keep these data sources on their own. So as to achieve the effect of personal or corporate data governance instead of data processing.

A song "Beware of counterfeit votes, don't forget to read the book carefully. It is laughable and the world is fair. The ambition is selfish, conspiracy to harm others, and good and evil will be reported in the end. You must be clear at the end. Then go on. National Treasures circulate. "The smooth recording of passwords accompanied the rise and prosperity of the century.

Where is the wave led by blockchain? We can expect that in the world created by such infrastructure, the flow of value is as agile as streams, and the foundation of trust is as solid as a pagoda.

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