Blockchains allow frictionless, fast, safe, and fair transactions between parties worldwide. They limit the ability of parties to benefit at the expense of the greater economy. They allow integration of the entire world into a fair and level economic playing field. And will help us to create the fair, honest, efficient, and safe world we all want to live in – says Paul Snow, CEO at Factom.com, in Bithub.pl’s #SundayInterview.
Is blockchain a breakthrough technology that can bring transparency to every aspect of social and political life? Or such a statement would be too far-fetched?
Paul Snow: The blockchain is going to bring transparency to every aspect of politics, business, and culture. Perhaps more importantly, the blockchain is going to bring trust.
The problem with trust using centralized systems like social media, email, applications, documents, and databases is that these electronic records are subject to change. Those in control of those systems, from users to companies, can modify, delete, and add new information. Those in control can in effect modify the past.
Public blockchains remove the ability to edit, delete, and insert. Bitcoin has enormous security, with its Proof of Work, to the point that its records cannot be modified despite being distributed worldwide without any access restrictions. Banks are only secure if they can absolutely control who can enter their vaults, or who can log into their databases. In contrast, anyone in the world can inspect Bitcoin’s ledger (what Bitcoin uses for a vault and database for its value). But nobody can change anything because of the math Bitcoin uses.
Technologies like Factom allow that insurmountable security in Bitcoin’s ledger to be applied to ledgers of data. Factom supports unlimited digital ledgers that can be created and used by unlimited applications and purposes, without restriction. These decentralized „books” of entries can be created, added to by many parties, audited, and validated by its users. They can refer to entries in other ledgers. This can be leveraged to create distributed digital identities, audit trails, manage devices in the Internet of Things (IoT) and more.
Being able to measure business processes in near real time by many parties with no centralized database, and no risk of modification or corruption (by mistake or malice) is going to change the way we do things.
You’re offering transparency and data integrity solutions. What exactly are the benefits of implementing your tools into the companies’ and other entities’ systems?
PS: Factom provides the ability to utilize the blockchain to solve problems, and avoid the complexities of actually building and managing a blockchain. We are seeing an explosion of interest in the blockchain, and in solutions that leverage the blockchain. What we are not seeing is an explosion of delivered, Enterprise applications deployed to solve real world problems.
Factom solves a simple set of problems: How to create a ledger of data, how to record entries in that ledger so it is secured by a public blockchain, and how to retrieve and access that ledger in one’s applications. At the protocol level, Factom does not verify and validate application data.
This approach is what allows Factom to scale. Because each ledger or data set is independent of any other from a data integrity, data order, and membership perspective, Factom itself can create digital proofs that only involve particular ledgers, and allow applications to validate those proofs on a limited data stream. Being able to select subsets is the first requirement of a blockchain, and Factom is the only blockchain technology built to do this.
In addition to developing and supporting the open source Factom protocol, Factom Inc. builds and maintains propriatry applications that utilize the Factom protocol, and extend it beyond just data integrity. Our Factom Harmony product does provide verification and validation services for some small set of business domains. Factom provides companies with a clean, useful, and flexible blockchain solution without encumbering those companies with preconceived restrictions and requirements.
Do you use any of the available blockchain platforms like Ethereum or Hyperledger or you’ve created your own platform?
PS: Factom’s own system of proofs and blockchain is a complete custom implementation written in Go, the language developed and used by Google. Factom is a member of Hyperledger, and has plans to donate code to Hyperledger. Factom will be anchoring into Ethereum to extend the digital security of the Factom protocol.
What about integrating your protocol with software used by your clients – is it a fit-for-all type of solution?
PS: The Factom protocol can be integrated into tools and software used by our clients, and we are involved with projects to do so. Some of what Factom Harmony provides is very close to a fit-for-all solution, but for most enterprise deployments, we provide some modifications.
First it was big corporations then governments that have taken interest in blockchain. Are medium and small enterprises following the lead?
PS: We are seeing growing interest in the blockchain in enterprise at all organizational sizes. Some small companies are quicker to make decisions, while larger organizations can deploy greater resources. In our experience, the advantages of either seem to be balancing over time.
One of the biggest problems of contemporary world is proper wealth distribution or rather the lack of it. Can blockchain help to change it?
PS: The blockchain’s first application was to create a honest, secure scoreboard for tokens called Bitcoin. Its massive advantage is that anyone worldwide can exchange tokens on the Bitcoin ledger and be certain of the honesty of the ledger. Everyone holding Bitcoin (and tokens on other public blockchains) is on even footing. Nobody has a preferred position in the system where they have a „house” advantage on transaction fees, right to accounts, ability to receive payments, or the ability to send payments.
In short, blockchains allow frictionless, fast, safe, and fair transactions between parties worldwide. They limit the ability of parties to benefit at the expense of the greater economy. They allow integration of the entire world into a fair and level economic playing field. And blockchains allow businesses, governments, and the people to create audit trails of their processes, actions, and history that is beyond the powerful players to manipulate after the fact.
Blockchains will help us to create the fair, honest, efficient, and safe world we all want to live in.
Interview by Przemyslaw Cwik
e-mail: p.cwik/at/bithub.pl