How do Layer 1 projects make innovation for the future?
Introduction
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All of us know that the public chain is an essential part of the Web3 infrastructure. Nowadays, new public chains are constantly emerging, aiming to provide developers and users with a better Web3 experience, and strive to break the “impossible triangle” of blockchain to achieve security, decentralization, and scalability simultaneously. Today we will be discussing the future of the public chain and How do Layer 1 projects make innovation for the future? How they are going to compete with other the most popular public chains currently. We invited our guests Elaine from Solar, Ben from KCC and William from Oasis Network.
- Please share with us your evaluation of how the current layer one project are?
Elaine: We have some very well known established layer one blockchains out there. For example, Solana which putting yourself out there a speedy blockchain with 1000s of transactions per second. But over the past year, Solana has had 10 incidents where their blockchain basically stopped. For Ethereum, ,they’re one of the most well-known layer 1 projects. They’ve been talking about shifting from proof of stake for years now. I think a lot of the layer 1 projects get too soft. They end up with a lot of VC funding. And what happens is they have to develop quickly because possibly VCs want more good performance. If the layer one project don’t perform, They’re going to take all money and the price will collapse.
So I think that is one of the problems. You’ve got a lot of money sloshing around with a lot of layer one projects. They grow too big, too fast. And basically they get ahead of themselves. I mean the difference with solar is when our main net launched. March this year, we launched without any VC funding and any ICOs, and we had to grow gradually. What we’re doing is we’re trying to build our community and get our community behind us to give us support. We’re working hard and organically, as opposed to a lot of layer one projects that get a lot of money thrown at them, as I’ve already said, and they sort of crash and burn.
Ben: We’ve seen like hundreds of projects who you may have ones ups and downs. It’s good to see the market still rapidly evolving, because you always see some new stuff every time. But it is strange for me is why they’re switching their positions or stuff not because of users choices or competitions, but they are dying by themselves. They’re like Luna, USD dies and even brings the whole party into a catastrophe. Every contributor of the project should be very respectful to the market, and always make good products. Users have to ensure be very cautious when making decisions in a situation, because we have to return this back to them when we don’t have something really practical, though how much bond you raised or how much token is available is not a milestone for layer one project to celebrate. But how many Dapps you have and how many users in your community is really important. So We are building our communities. Right now we have communities in 33 countries and we have more than 80 Dapps in our ecosystem. We put a lot of concentrations into these projects and help them grow. We’re not looking forward to like VC funding to make some big news for everyone and the token price. So it’s really important to focusing back to products and improve performance of product goal instead of celebrating the prize and how much fund raise. So I think during bear market, you should definitely spend all of time to deal with essay, community and developers. we should make very good connections and make good products.
William: At the moment, the layer 1 space is quite crowded, but it’s a good thing that new projects spring up like solar, Aptos and Sui. Some new projects which have very handsome valuations and got investment. But it’s not mean the space is perfect. There are a lot of questions and issues remain to be solved. There are also other layer one projects, they boast better scalability, decentralization etc. So if you are project and you can provide new value, and solve some pain points. Then there is a chance for you to to survive and bloom. But we are different from other layer1 projects because we have been focused on privacy preserving technology and privacy private computation. This sets us apart from other general projects. We are focused on privacy check. We think in such a market situation, it is more reasons to build your community and develop your tech knowledge. Because now people are not so crazy about token price. And it filters out a lot of noise in the market. Many people would want to participate in ecosystems that they think have long term value. So that’s what we add to this network are doing and we hope as the core proposition from web 3 implies that we want to give data ownership back to users. And by doing so, we also want to enable users to authorize the use of that data by third parties. And the users themselves can reap the benefits derived from the use of such of data. So this is what we call a responsible data economy and I do think that this will enable us to truly propel web3 forward.
2. what you think about the new blooming layer one project? What characteristics do they have to tackle the problems we saw in the market?
Elaine: Decentralization is definitely important. We are a true decentralization community-driven blockchain project which is one of our core values. Scalability is a massive issue for layer 1 project. The other problem of layer1 is political issue, such as Libra. So this is the issue to make project thrive and survive. Back to decentralization, take Solana into consideration. They’ve gone down 10 times anf their nodes gone down a considerable number of the nodes which stopped the blockchain. If you read about Bitcoins, you will know decentralization means even do not know the technical stuff. But it is still in early stage. Everyone still using Ethereum and user-friendly application, I am wondering how it will going. Everyone put high expectation of the move.
William: The trilemma like security, scalability and decentralization alway striking the balance. There are a lot of new layer 1 projects in the market. Ethereum will remain the largest and the most prominent one in the market. And a lot of these scaling layer tools, scaling solutions and perhaps other some of the other layer 1 solutions will adopt like EVM to be compatible with Ethereum, because of the large user base and theorem ecosystem. They have the most developed Web 3 developers and to be EVM compatible and gives advantages to attract developers who are familiar with solidity language and so.
If a new layer 1 project and want to be relevant in the layer 1 market, then you have to come up some credible and convenient solutions to the problem. At least you have to solve some pain points of the maket, perhaps you are more secure, more scalable, higher throughput, or lower gas fee and so on.
3. In your opinion, how do you see that the Layer 1 project will be able to play a vital role in this innovation?
Elaine: The whole principle of web3 is dcentralization. It’s permissionless and trustless. Web 2 is something like facebook or wordless where you do not actually own your idea, your identity on these platforms. Your data is owned by the big organizations. Web3 is a opportunity in my opinion. The games give people a chance to earn cryptocurrency. For example, NFT is away for artists to actually own their work. It gives struggling artists a platform to sell their art. It’s artists in charge and owns there.
We talk about Defi and other web3 project. DeFi is enable people to borrow and lend money without big financial organizations. It’s taking away from the big institutions. In my opinion, it’s a mind — blowing.
Ben:
Remember how we stepped into the mobile Internet era 10 or 15 years ago. When the iPhone 3G or iPhone 4 just came out, and nobody thinks such a small phone would work for anything? But now our hardware performance has been upgraded thousands or millions of times. And that’s how Web 2 grows. When we have phones, we have applications, and we have users, and we have to make innovations.
And for the crypto and Web3 area, we are still catching up in hardware, software, or Internet performance. But pity today, if you can go check the data, the daily active users for Ethereum nowadays are still stuck at 300,000 users. And even though we have a lot of new applications, we don’t see a bombing in the user amounts. So, what kind of roles could we play for layer one?
We are absolutely the bridge between our users because they are the factors that define our success. We have to really care about our users and figure out how we can persuade Web 2 users to use Web 3. I’m really looking forward to having some great applications that really change the users’ lives. They may need some functions that they or will never actually be able to achieve in real life. This will drive us forward, and we will definitely have to make innovations at that time.
William:
Traditionally, when we use these Internet services, we need to create an account to use their services. But we do not own the data that we generated on these platforms and we have no knowledge of how our data are being used by these platforms. We’ve got a lot of cold calls and spam messages and that is because our information is leaked to third parties like advertisers.
At Oasis network since our inception we’ve been focusing our efforts on providing privacy preserving technology and to users and to projects and to enterprises. We want to help them protect their data privacy and to use their data effectively while making sure that their data is safe in their own hands. For example, in late August we reached a partnership with Meta and we used the secure multiparty computation technology to build a platform for Meta. Because they are running a survey and they want to ensure users’ data submitted are totally safe and private. So we used this technology to build a platform for them. In this way we can make sure that the Meta AI model is inclusive, safe and confidential.
Another example that can illustrate the idea of a responsible data economy. In May this year. We reached our partnership with Genetica, which is a leading gene testing company. Genetica has uploaded 100 thousand samples of their users’ Gen data onto the Oasis network and these data will be kept confidential and private on the Oasis network. The owners of these gene data can create an Oasis account and on the dashboard they can see how their data is being used and who is using it. They can also authorize who have permission and access to their data. The third party, let’s say a pharmaceutical company or the genetic platform itself who wants to use this data, they have to invoke the data and during the process they have to pay a certain fee. After this they can have access to the data, but they can only use the encrypted executed results of the data but not the raw data itself.
In this way, we can make sure that users have total control over their own data and they can also authorize third parties to use these data without compromising their data privacy and can also reap the benefits from the use of their data. And so that’s the responsible data economy we’re building. We think that this vision can really expand and extend to the use of the utility of privacy preserving technology in Web 3 and also have the appeal to draw more people from Web 2 into the Web 3 space. We are very much looking forward to seeing traditional Internet services coming into the Web 3 space get back their control over their own data and to enjoy privacy while also benefiting from their own data.
4. There is a war between the FTX and Binance. What do you think of it or what can we learn from this war happened? How will the war impact our project?
Elaine: It seems to me to highlight the problems with the platform and there is no real decentralization. Binance is the largest platform by volume of transactions. And having one person with so much power and influence, and so much money, can cause chaos. I don’t think it’s good for the morale of the cryptocurrency market. It makes people worried and scared. And in my opinion, it just goes against everything. Cryptocurrencies represent decentralisation, and where is the decentralisation? In my opinion, it’s the power of money.
Ben: It’s a sign of a bear market, like we don’t have enough cake and we have to share it. In 2017, when people were calling it the ICO period, a handful of centralized exchanges survived to this point. So FTX and Binance there is no a winner in a way, maybe the market leader at some point. I hope FTT doesn’t become the luna, but I’m pretty sure it won’t because they’re not the same thing, but it always calls for some other smaller item or something that you might choose by BIT, and that token is actually smaller than FTT as well, if not worse. Maybe BNB or FTT won’t die now, or they won’t get anything very complete, but smaller projects may be illiquid and they may add like liquidating some important assets to save FTT or BNB.
William: I think this incident shows how early we are in the industry. To see two leading cryptocurrency exchanges engaging in this kind of bickering and confrontation. I think it undermines people’s confidence in centralized exchanges to some extent, because in addition to CZ dumping FTT tokens, it reveals that these centralised exchanges are like banks. They will use users’ funds for other purposes to make a profit. It’s not fully transparent and users don’t have full control over their money on the exchange. And if something bad happens, it will affect the safety of their funds at the same time.
