as of 18 APR 2018
Use the real (PoW) Blockchain, and this stuff would not happen …
“The least evil.”
That’s how one ethereum user described the latest effort to recover $264 million in cryptocurrency lost due to a code fault in a popular ethereum wallet. But while the recovery efforts that have proliferated since the November incident have been so far shunned, a new effort, now documented in code, aims for a simpler and less invasive way to implement the fix.
Stepping back, in November, the code library associated with U.K. startup Parity’s multi-sig wallet was deleted by a pseudonymous hacker who “accidentally” exploited a function called “self-destruct.” In the fallout, Parity proposed a modification to the ethereum software whereby the self-destruct mechanism would lose its functionality, but the proposal was found to contain significant security risks.
This new proposal, published on April 15 by Parity Technologies communications officer Afri Schoeden, suggests simply restoring the lost wallet library with a version of the code that does not contain a self-destruct function.
Users would be able to regain access to their funds, and on top of that, the new code would protect Parity from similar exploits going forward. As such, the new proposal sends a clear message – when it comes to fund recovery, some developers have no intention of giving up the fight.
“I think simply recovering funds is both more technically sound and more honest than the original proposal to modify the self-destruct opcode,” ethereum core developer Nick Johnson told CoinDesk.
And a number of others agree.
Co-founder of ethereum prediction protocol Augur, Joey Krug, told CoinDesk:
“I do believe it doesn’t make sense to just have all this capital senselessly locked up.”
What seems to be different about this proposal is its limited reach.
Not only is it focused on the Parity software client only, but it’s also targeted specifically at only the 513,774.16 ether lost in the November hack. (This provides a contrast to past proposals, which have aimed at fund recovery broadly).
“Speaking personally, I’m in favor of helping people recover lost funds if the cost to do so is low relative to the funds being recovered, the owner is unambiguous, and the funds are definitively locked up,” Johnson said. “I think the case with the Parity multi-sig bug fits all three criteria.”
The other thing EIP-999 seems to have going for it is that it’s simple to execute. Instead of trying to rework the whole ethereum virtual machine, the proposal would be released to Parity software clients only by way of hard fork upgrade.
Schoeden emphasized this ease to implement, pointing to the pull-request he already submitted to Parity’s code base.
And Krug, like others, believe this request might actually see enough community support to finally put an end to the Parity fund recovery debate.
Although for some, including Krug, the balance between protecting ethereum users and encouraging good security practices should be taken into account when deciding whether recoveries should happen.
“In my opinion, proposals like these should be accepted provided the code was actually audited,” Krug said, adding:
“If it wasn’t, the community should be less forgiving.”
But with the broader debate over the recovery of funds due to code vulnerabilities splitting the community for years, some aren’t so sure even EIP-999 will settle the mess.
“Allowing case-by-case proposals for mistake reversals is a terrible idea and opens up all kinds of concerns. This would set a terrible and dangerous precedent,” one user wrote on an ethereum forum.
This sentiment seems to be the current majority on social media and GitHub, where many are worried about future corruption and bribery.
Indeed, a Reddit user warned, “Some unknown amount of developer mindshare will leave ethereum if this happens.”
Wrapping up what he sees as the sentiment among the community, Johnson told CoinDesk, “It seems plain to me based on an informal survey that a large proportion of the community is opposed to the idea. I think it’s unlikely this proposal will be implemented.”
Yet, the debates have brought about some sort of silver lining.
After EIP editor Yoichi Hirai stepped down from his role as a result of an eruption of criticism over the frozen fund recovery efforts, the EIP process was streamlined.
Still, Schoeden is aggravated by the opposition, telling CoinDesk:
“Even though I hear the feedback and apply changes to the new proposal, I get the feeling we’re running in circles here.”
The health industry’s potential for Blockchain has been outlined numerous times, and new startups continue to emerge in 2018. On Monday, April 9 it was announced that a German consulting firm developed a Blockchain-based solution for the management of sensitive medical data, while a week prior to that an important industry player in the US stepped up with a foray into Blockchain as well.
What exactly can Blockchain startups bring to the table? Well, a lot: improved security, effective distribution of information among involved parties, anonymized data pools for research companies and new ways to fight counterfeit drugs.
Healthcare is an industry where patients’ information could be processed by numerous institutions – for example, private or public hospitals and clinics, general practitioners and analysis labs. Therefore, the ultimate goal is to provide both easy and safe access to that information.
In 2016, John Halamka, chief information officer at Beth Israel Deaconess Medical Center in Boston collaborated with a group of scientists at MIT to come up with a Blockchain-based project for convenient storage of patients’ information. The project was named MedRec.
MedRec is based on Ethereum’s smart contracts and links healthcare providers together, allowing them to share their data. Only the patients can cryptographically sign smart contracts on the Blockchain, ensuring that they’re in control of where their medical history goes.
“Our system gives patients a comprehensive, immutable log and easy access to their medical information across providers and treatment sites,” states the project’s white paper.
Therefore MedRec grants the healthcare provider access to patient’s data, but only when the Blockchain is instructed to give it. Further, it executes the patient’s instructions, sending information to a pharmacy or a specialist for referral, only with the patient’s consent.
In a similar fashion, the London-based Medicalchain startup implements Blockchain to improve health record storage. Different institutions such as doctors, hospitals, laboratories, research and health insurers are able to request permission to access a patient’s record so they can provide their services and record transactions on the built-in ledger.
With Medicalchain, doctors are able to enlist themselves to care for patients by using the integrated application. That ensures a secure and reliable way of finding doctors because they need to be verified and their license has to be checked. Mo Tayeb, co-founder at Medicalchain told Cointelegraph:
“Blockchain technology is set to change the way healthcare is managed forever. Blockchain allows for clinicians and patients alike to be confident that the medical records are accurate and up-to-date as the distributed ledger guarantees an incorruptible, trustless version of the data which can be depended upon at any given time. An indisputable single version of the truth is not achievable with today’s current systems and infrastructure.”
Similarly to MedRec, Medicalchain employs a permissioned Blockchain to ensure extra levels of protection for patients’ data. Tayeb explains: “Using Hyperledger, Medicalchain will allow patients to control permissions to their health records – who gets access to them, what information they get access to and for how long. It also allows for health staff to trust the integrity of the medical records as patients will only have ‘read only’ access whereas certified and verified clinicians will be given ‘read and write’ permission.”
In April 2018, US healthcare giant UnitedHealth Group (currently ranking sixth in the country on the Fortune 500) announced the partnership with other industry players in using Blockchain to keep records up to date via its Optum subsidiary. According to the US government, about 50 percent of doctor directories in the country contain incorrect information. As joint statement goes:
“Industry estimates indicate that $2.1 bln is spent annually across the health care system chasing and maintaining provider data. The pilot will examine how sharing data across health care organizations on Blockchain technology can improve data accuracy, streamline administration and improve access to care.”
“This is likely one of the very first nationwide healthcare Blockchain alliances,” Optum senior distinguished engineer Mike Jacobs commented the move. “Healthcare in general is just getting started on understanding what the appropriate uses are of this technology.”
Similarly, Germany-based Camelot Consulting Group developed a Blockchain-based solution for the management of sensitive medical data in April.
With its Hypertrust X-Chain data management system, the company aims to offer the healthcare industry a secure digital platform for the exchange of patient data. The goal is to provide all actors that are authorized to participate in the therapy process with decentralized data storage based on Blockchain.
All data transactions are encrypted and stored on an immutable Blockchain and will be carried out directly between the authorized participants, the company says. It will also allow the “integration of partner systems” and “real-time temperature, location and quality control as well as reliable proof of origin”.
To illustrate the advantages of the new system compared to conventional methods, the Camelot Consulting Group uses the example of extracorporeal cell therapies in which patient’s cells are removed and processed in a complex, multistage process.
“Many different actors are involved in this process, such as the treating clinic, the cell removal center, logistics service providers and pharmaceutical companies. Today, most important data is still transmitted by analog means in order to be recorded again in the course of the further process. The risk of erroneous data and data misuse is therefore immensely high.”
MedRec’s Blockchain system is sustained by miners. But MedRec doesn’t run cryptocurrency transactions, and, therefore, miners who offer their computing power to verify data are not given a monetary reward.
Instead, they get access to aggregated and anonymized data from consenting patients, which is an important resource for research companies developing new drugs and treatments — having access to a pool of genetic data can significantly speed up their operations.
Health providers might have to wait a long time to get paid by insurance companies. In 2016, US bank holding Capital One aimed to tackle that issue by collaborating with LA-based Blockchain company Gem.
“Blockchain technology connects the ecosystem to universal infrastructure, and shared infrastructure allows global standards that do not compromise privacy and security,” pointed Capital One in its press release.
Gem operates via GemOS, a system that serves as a platform for managing data, identities and rules on a safe Distributed Ledger Technology (DLT). It stores patient’s credentials as well, used for signing transactions and swift exchange of information among the parties involved in the insurance contract.
Blockchain-based systems don’t have a single place to attack due to the technology’s basic principles, where each block is immutable and cryptographic. That seems to be particularly important for healthcare industry, prone to hackers’ attacks. For instance, last year, the UK’s National Audit Office said the country’s health service failed to “follow best practices” to prevent the WannaCry cyberattack that partly paralyzed the UK’s National Health Service.
Few months after the said attack, a UK university partnered with an Indian tech institute to examine Blockchain protection against future cyberattacks. It was announced that City University London and Indian Institute of Technology Kharagpur would work together via a consortium which will focus specifically on arming health care entities and Internet of Things (IoT) components against the effects of international cybercrime:
“Our consortium will be exploring the use of a privacy-preserving Blockchain architecture for IoT applications in healthcare data-sharing, using attribute-based encryption (ABE) to provide greater security for the devices.”
Similar problems were experienced in the US, where The Office of the National Coordinator for Health Information Technology (ONC) published a research paper on the applicability of Blockchain technology in securing and recording medical record components last year. It was noted that each year, a large number of healthcare companies are exploited by hackers and security breaches. The acquired databases of stolen data of patients and other protected health information – which are regulated under US law – are usually sold on the dark web.
In a research paper entitled “Blockchain For Health Data and Its Potential Use in Health IT and Health Care Related Research” authored by Laure Linn, the ONC stated:
“Blockchain technology has the potential to address the interoperability challenges currently present in health IT systems and to be the technical standard that enables individuals, health care providers, health care entities and medical researchers to securely share electronic health data.”
Some medical startups offer to pay for medical services using cryptocurrencies. Medicalchain announced a partnership with the London-based Groves Medical Group for a pilot program giving patients access to telemedicine and the ability to pay in cryptocurrencies. The project will use the Hyperledger Blockchain technology and is expected to be launched in July 2018.
According to the Medium post announcing the collaboration, this partnership makes The Groves the first UK medical practice to use Blockchain and accept cryptocurrency payments for healthcare services.
Some startups even offer their own cryptocurrencies. Patientory, a free-to-use Blockchain-based app launched in 2017 where users can create a profile to keep track of their medical history, employs their own cryptocurrency called PTOY to provide some extra options for both doctors and patients. Doctors get private health information through the infrastructure on the Ethereum Blockchain, whilst the patients can buy extra storage space in the app.
Counterfeit drugs is one of healthcare industry’s biggest headaches. For instance, the US Food and Drug Administration (FDA) wrote in 2013 that “more than a third of anti-malaria drugs available in Sub-Saharan Africa and Southeast Asia are counterfeit or substandard.” Fake malaria and tuberculosis drugs cause about 700,000 deaths per year, according to International Policy Network.
Block Verify is a startup that offered a solution. Pavlo Tanasyuk, its founder, told Cointelegraph in 2015:
“We decided to start with pharma [sic] as it is one of the sectors where people are directly affected by using counterfeit products. That can lead to various complications and even death of the consumer. It is also one of the most challenging environments.”
The Block Verify team uses a private DLT simultaneously with the Bitcoin Blockchain, which they use as “a ledger to hash certain data to secure [their] own chain. Essentially, they give every product its own permanent record on their DLT, making manipulation of private keys impossible, claims Tanasyuk. The system is designed to protect everyone at each point in the supply chain, creating a “trustless system of transparency”. That way, a counterfeit product should be detected by a simple QR-scan.
The potential effectiveness of Blockchain-based technologies has not gone unnoticed by governmental organizations, presenting crucial opportunities for public health.
In 2016, it was announced that a software company Guardtime partnered with the Estonian Government’s e-Health Foundation to accelerate Blockchain-based management of patient healthcare records.
By mid 2017, the system was implemented on the national level, and the public health records of Estonia’s 1.3 mln citizens were secured inside a system based on Guardtime’s KSI technology.
Estonia claims to be the first government in the world that have embraced the DLT in its live production systems for ensuring the integrity of the records, logs and systems. Guardtime’s KSI Blockchain has been continuously running since April 2008, and is purpose-built for massive-scale integrity instrumentation of any type of data at rest.
In 2017, a trade giant Alibaba announced the collaboration with Chinese authorities to launch the country’s first application of Blockchain technology in the medical sector. Ali Health was set to work with local government in the city of Changzhou first.
“It is cost effective and safe. With Blockchain, health centers and district hospitals are interconnected so that the people can enjoy convenient medical services.” Zhang Zhihong, director at Zhenglu Town Health Center in Changzhou told local news resource Yicai Global.
While full details of the scheme have not been disclosed, the Ali Health’s project will supposedly involve creation of “a number of data security nets” and storage of data in ciphertext with “strict access controls and operational privileges.”
In August 2017, it was reported that Russia’s Ministry of Health partnered with state-owned bank Vnesheconombank (VEB) for the development of a Blockchain technology-based system to be used in exchanging patient history in the healthcare industry.
There are no specific details regarding the project at the moment. The partnership could be part of the mandate by the Russian government for the creation of a new interagency data-sharing system.
Although there have been no federal project announcements, in July 2017, the American Research and Policy Institute is
sued research arguing that public health programs such as the U.S. Medicaid program could benefit from the use of a Blockchain based distributed ledger and smart contracts. In 2016, Medicare fraud caused more than $30 mln in losses in the United States, prompting various agents to argue that Blockchain-based systems could help minimize it.
Imagine a way to expand bitcoin payments to millions per second. Now, imagine a clunky, command-line interface.
That’s the extent of the divide between the vision enabled by bitcoin’s best-yet scaling solution, the lightning network, and the current state of its design. But while that’s daunting, developers are moving ahead on designs to make the payment system easier to use, with one recently submitting a proposal for connecting lightning with a payment technology that could make it feel as futuristic as it’s touted.
That payment technology, near-field communication, or NFC, would allow a user to pay for an item just by holding their smartphone an inch away from the device it’s paying.
Not a new idea in bitcoin or the payments world at large, NFC-based payments have caught on throughout Asia and Europe – not only on smartphones, but also through chips embedded in payment cards. And while the U.S. might be lagging behind in NFC adoption, bitcoin’s early adopters might just be the right target audience.
As such, the proposal, submitted by developer Igor Cota, looks to standardize a way to connect lightning with NFC.
Invoking the name of his lightning wallet that uses NFC, Presto, Cota told CoinDesk:
“I want the payments to be instant just like with the contactless cards we have here in Europe. A user would simply tap on the payment terminal and presto!”
Further, Cota imagines turning any computer into a lightning point-of-sale terminal through the use of a $29 USB attachment, a route that has proven successful in his early tests.
Given the success, Cota’s proposal is about standardizing what he’s created, adding it to the many other standard rules that describe how each lightning software implementation should operate.
Many bitcoin payments implementations tend to use QR codes – those pixelated-looking black-and-white squares that encode data that can then be scanned and consumed by smartphones. And while Presto supports QR codes alongside NFC, he believes the latter provides a much better experience.
QR codes not only can be a bit finicky, but they also can become “unwieldy,” Cota said, especially when more information is added to them. In this way, merchants won’t be able to add much information such as itemized receipts and coupons to QR codes, he said.
NFC, though, doesn’t have this hurdle.
“I’d like to see a system where the payment terminal sends a nice HTML receipt for the customer – that receipt has, say, a table list of your grocery shopping with subtotal, taxes, grand-total, perhaps a shop logo, some loyalty code or a coupon for future use,” he said.
In Cota’s mind, this would give consumers a more detailed record of their spending habits, empowering them to take even more control of their finances.
“Imagine a wallet that can tell you how much you’ve spent on broccoli last month?” Cota said, adding:
“With crypto you’re always in control, but with these digital receipts you are even more so.”
But first, Cota is trying to get his NFC implementation added to the standards that lightning network developers have established in an effort to make sure all implementations are compatible with each other.
These standards are called “BOLTS,” and Cota believes NFC should be added to BOLT 11, which explains how “invoices” – describing how much a person owes – should be encoded and presented to a user. It’s a similar process to that of the credit card reader at Starbucks showing you that you owe $4.50 for a mocha latte.
For now, BOLT 11 only describes a standard for QR codes.
Already, Cota has come up with a rough standard, putting together a Multipurpose Internet Mail Extensions (MIME) type, which is a format for sending data; an NFC application ID, which indicates the payment method is lightning; and a “very simple protocol to forward socket data.”
Though these pieces weren’t so hard to come up with, Cota said he thinks it’s important to write up a standard, whereby all NFC-enabled point-of-sale devices can accept any NFC-based lightning payment, now to be ahead of the game should NFC-based lightning payments take off.
“For the sake of interoperability, it would be great if we agreed on some standards,” he explained.
And already, most of the public technical feedback has been positive, with Lightning developers ZmnSCPxj and Corné Plooy responding favorably to the proposal on the mailing list.
However, Bitrefill lightning developer Justin Camarena was a bit wishy-washy, telling CoinDesk:
“It’s an obvious way to pay in the future but it seems we’re a bit too early as there are no hardware point-of-sales offering lightning support.”
Still, Cota is plugging away on the next steps to move the project forward.
“As you can see the [Presto user-interface] is not really there yet but I’m working on it,” he said, adding, “What I’m working on at the moment is a protocol that makes sure the NFC payment goes through even in case the paying device is offline.”
Cota plans to submit another pull request for developers to review once this mechanism is finished.
Igor Cota igor at codexapertus.com
Thu Apr 5 09:46:32 UTC 2018
I feel that one of the biggest promises of lightning lies in it being used for everyday retail payments.
I’d like to see a system that’s:
1) instantaneous like the contactless bank cards of today
2) encodes a fancy HTML receipt in bolt11 for the payers future reference
QR codes are a bit unwieldy and even more so if you want a nice HTML table description of your grocery shopping with hundreds of items – this relatively large amount of data makes them impractical to scan.
To this end I’ve been running an instance of c-lightning on Android  and experimenting with payments via NFC. I set up a machine with an NFC USB dongle that acts as an point-of-sale terminal . So far so good!
There are two basic ways you can use NFC enabled phones today – as passive tag readers or in card emulation mode (not sure if the latter is available on iOS).
Passive tags are really simple and encoding bolt11 to them works as expected. If you set the right MIME type Android will open whatever app is registered to handle lightning and you can either pay instantaneously or after user confirmation. Works great provided both the phone and terminal are connected to the network and have a route to each other.
Card emulation mode is more interesting because it enables us to have two way communication and therefore an ad hoc connection to the lightning network. After some handshaking, phone can tell the terminal that it wants to connect to lightning via NFC. All communication between these two lightning nodes can be done over NFC or even bluetooth . This might be useful as fallback in situations where mobile data is not available.
I settled on a MIME type (application/lightning) and an NFC application id (LIGHTNING). There is also a very simple protocol to forward socket data. For the sake of interoperability it would be great if we agreed on some standards but I’m not sure how to proceed with this. Should these be part of a future BOLT or is mailing list banter enough?
I look forward to your views!
A fundamental division – and an opportunity for others to fill the void ‘big corporate’ leaves, and do not have the creds for:
“If you or your engineer friend is bored at BigTechCo, get in touch.”
The tweet, sent out by Coinbase vice president and general manager Dan Romero, represented a rare request from the San Francisco-based exchange. Despite building on various cryptocurrency protocols for years, it was perhaps the first time the company had signaled it would offer financial support to someone working directly on open-source code.
As such, the tweet drew its fair share of confusion among bitcoin and ethereum’s largely volunteer developers.
That’s not to say that they aren’t interested in taking sponsorships from companies in an effort to make money from their passions – they are. But the trouble is many developers see larger industry startups like Coinbase, which made more than $1 billion in revenue last year, as a prime example of the “big tech companies” that Romero positioned as antagonists.
In fact, some would go so far as to say there’s a quiet struggle being waged in the blockchain industry between the coders who develop these open-source protocols and those who mainly sell related products or services for commercial interest from their corner offices in Silicon Valley.
This was on full display when Bitcoin Core developer Luke Dashjr tweeted a disgruntled reply to Romero after private conversations clarified that the role wouldn’t focus exclusively bitcoin or ethereum, nor would it give developers autonomy to focus on projects they see as beneficial.
Instead, Coinbase executives would be directing the work, potentially requiring the developers work on cryptocurrencies that might run afoul of their own personal tastes. (As an example, in the case of Dashjr, the long-time bitcoin coder, was loathe to devote time to rival bitcoin cash).
Coinbase acknowledges a kind of disconnect, yet thinks the lines between industry and open-source will continue to blur.
“At a high level, we want to invest in supporting open-source communities, because we believe that the future of this industry will be defined more by open source than by enterprises,” Jori Lallo, a software engineer at Coinbase told CoinDesk. “That said, as a fast-growing company we’ve had a lot of things to split our time between, and admittedly we didn’t spend a lot of time on supporting open source in the early days.”
That initial neglect left a lasting impression that has been hard for Coinbase to shrug off.
According to Jeremy Rubin, a Bitcoin Core contributor, Silicon Valley’s culture in general remains at odds with open-source philosophy, in that the former doesn’t give enough credit and support to the broader ecosystem.
Rubin told CoinDesk:
“You see this at a couple different companies but I think they [Coinbase] are one of the most egregious. They’re trying to do better, but they got a ways to go.”
Still, Lallo detailed some of the exchange’s work in reaching out to the open-source developer community that has attempted to shift that perception.
For instance, in mid-March, Coinbase introduced the Coinbase Protocol Team, whose mission it is to contribute to community-led projects, naming payment channels, proof-of-stake blockchains and light clients as some areas of interest, and widely respected bitcoin programmer Jim Posen is a part of the team.
Even Dashjr recognizes that Coinbase’s efforts aren’t “bad” and could even bring to the table some insights that open-source developers may miss, since they don’t interface with the business community quite as much. “It just isn’t the norm or ideal,” Dashjr said.
Others argue, though, that such programs, after years of inaction, aren’t enough, though Rubin said he sees the problem as bigger than any one company.
In Rubin’s view, lucrative blockchain companies could easily donate a few million dollars each in grants and sponsorships for open-source developers. It’s the same argument open-source developers have made regarding a whole slew of integral internet protocols that have allowed companies like Google, Facebook and Uber to grow into multi-billion-dollar companies.
“Not only do they not do that [provide generous patronage], but they don’t support a lot of conferences that are really critical to the space. They didn’t support the MIT Bitcoin Expo this year, even though they sent a bunch of recruiters,” Rubin said, adding:
“I don’t think Coinbase really gets open source.”
In addressing the criticisms, Lallo said, “As we grow, expect to see more investments – both in terms of time and money.”
Coinbase also announced in a blog post on Thursday that a new venture capital arm of the company will provide “financing to promising early-stage companies” that “move the space forward in a positive, meaningful way.”
But it might take more than time and money.
According to Christopher Allen, the former principal architect at Blockstream, it’s more about adapting to the culture of open source.
For instance, Blockstream, which funds the work of several developers who solely work on the bitcoin protocol, goes a step further by offering employees individual patent rights for technologies they contribute to, in addition to roughly 20 percent paid leave to work on side projects.
“These types of very progressive attitudes towards open source were a large part of my consideration [in joining Blockstream] because I’ve been working on my own projects for a number of years,” Allen said. “I wanted to be able to continue to work on them without being constrained.”
Joe Lubin, founder of ethereum startup incubator ConsenSys, echoed the importance of this cultural shift toward independence. As such, ConsenSys strives to retain top talent by letting employees choose their own projects and work whenever and from wherever they want.
Still, many leading blockchain companies struggle to retain talent.
For example, bitcoin security startup BitGo lost Alex Bosworth, a renowned developer who now works on lightning network implementations, in December.
According to Bosworth, the missions of large tech companies, and now large crypto companies, run counter to the ideals of the developers who started developing the protocols to begin with.
“The tech companies are building empires based on locking users into walled gardens and generally not thinking about what is best to progress the needs of the user,” he said. “That’s something that open source software addresses which is pretty inspiring and fulfilling to work on.”
As such, the community has rallied around several initiatives that fund developer work without strings attached.
For instance, several developers CoinDesk spoke to mentioned Chain Code Labs, which sponsors a handful of Bitcoin Core developers at a financial loss through the money the founders, Alex Morcos and Suhas Daftuar made from a previous Wall Street venture. And Allen recently launched the GitHub Blockchain Guild, which aims to create new opportunities to fund contributions to various blockchain projects.
The collaborative, autonomous nature of these initiatives is what makes open-source cryptocurrency developers so drawn to them.
Speaking to the need for the industry to adapt to the open-source culture, Lubin said:
“Nobody works on projects that they don’t care deeply about. An entrepreneur’s freedom to develop their own projects and operational style doesn’t need to change.”
Along the same lines:
Cointelegraph had a chance to talk to Tim Draper, American venture capital investor and businessman, founder of Draper University for entrepreneurs as well as Draper Associates, a VC firm that invested in Tesla, Skype, Baidu, and many other companies.
Tim Draper has been involved in different crypto projects, from the purchase of seized Bitcoins from the Silk Road marketplace website in 2014 to advocating Tezos in 2017.
He shared his thoughts with Cointelegraph on Blockchain adoption, regulations in the US and China, and why he wants to leave California.
Government needs it the most. No question. Worst service, biggest industry, highest cost. Government is clearly people. The size of an industry tends to be the number of people involved. Government is affecting the most people and it is providing the worst service at the highest cost. And the Blockchain can remedy that by creating a whole virtual layer of governance.
That could be the beginning of where governments have to compete for us so that their services increase, improve and the costs go down. Your taxes will go down, and your education, and your health care and whatever – it will go up, it will be better.
But other industries that are going to benefit, anything that’s tied to data or the individual, so identity will be very important because anybody who’s affected by data is going to have a much improved situation because that data will be on the Blockchain, permanently there, tied to each individual. And once that’s the case that can help with all sorts of other industries: whether it’s healthcare, or commerce, or improve retail experience – it could be any number of different things that could be helped just because they will have better data on you.
We, who are in the industry, are pushing as hard and fast as we possibly can. And it’s just that there are all these uncertainties, created by the governments that are run by the grandparents of the people who are creating this new industry. And they don’t get it. It is very frustrating for the people who are creating the industry.
So you have these regulators who are 70-80 years old and they are the ones telling these twenty-year olds what they should be doing. But they’re the same people who have given them huge education debt, poor education, not appropriate for their work life. And now they’re trying to tell them not to do something. That is actually creating a whole new economy.
I mean if I’m a millennial, I’m deeply in debt, I have an education that’s not appropriate to the jobs that I have to go find – I’m kind of lost. But there’s this big opportunity all of a sudden. There’s Bitcoin, there’s crypto, there’s a whole new world out there. That hasn’t been destroyed by the regulators. Now the regulators are coming in, they’re making it very difficult on people.
But any country that gets highly regulated gets poorer, more poverty. And any country that’s free – gets richer. And I think the US is trying to figure this out.
I know Japan has figured out. Make it free – make us rich. Japan thinks I have to control and regulate. I mean, China says I’ve got to control and regulate and they’re going to create a bunch of poverty. And it usually takes twenty years by that time they have moved on. But they are ruining the lives of many people by putting in too many controls, or too many restrictions, or too many regulations.
So when you see the FDA or the SEC or FASB – any of these big institutional regulators come in heavy-handed. They are destroying the potential for growth and wealth in their country.
You ask the question about what is keeping this from happening. It’s the uncertainty created by all of these regulators. That is slowing down progress; it is not allowing enough of creativity to flourish. And they’re in competition with all the other countries and regulators of the world. And so the lighter touch – the more likely you and I are to move to those countries, or to work with those countries, or to be a part of those countries.
My advice to the SEC is go ahead – regulate them all. But make it a one-page document that anyone can fill out. Don’t make it so that these two girls and a dog have to go hire a million dollars worth of legal work to just get approved. It makes no sense. Just have them go ahead and register, so you have the data that you need. But then let them go and then if they start affecting too many people they become a problem then go ahead and come in and say: “Okay, now you have to go our next level of regulation” or something else.
But ease in. Let’s let these things flourish. Who knows, what creativity is going to come out of these ICOs.
When the Internet came along the governments were trying to shut it down. And all of a sudden think of what’s happened with the Internet: all our lives are so much fuller and more interesting, and more dynamic. And I remember I’d spend hours waiting for somebody to come pick me up when my car broke down. Now if your car breaks down – you leave it on the side of the road. You go boom, I got an Uber – it all happens so quickly, that never would have happened if the Internet hadn’t happened. So this is and if we hadn’t let the Internet go, let it be free, the freer – the richer. Freedom equals prosperity, regulation equals poverty.
Everybody wants to leave California. Anybody in business wants to leave California. Because even though the weather’s awesome and their friends are probably here – all of the incentives are to leave.
That’s why I want to flee California. I want a fresh start. And also to leave the US but that’s different set of incentives.
The taxes are higher here, the services are worse, educations worse, the roads are poor. You go to Texas – they have no personal income tax, they have great roads, they have a free government encouraging innovation. You need that.
New York, they have the problem that California does. They are over regulated, they’re on top of each other, they don’t let anybody do anything without filling out forms to do it.
But it’s a good thing about the States because they have to now compete for us, used to be pretty much all the states were competing and felt that way and they worked hard to provide good service to you. When was the last time, a bureaucrat said to you “What can I do to make your life better? How can I improve your business environment? How can I improve?”
They used to do that 25 years ago, I walked into a government office with my father and they said, “How do I improve your business environment? How do I make your home life better? How can I improve your child’s education?” That was the attitude that government had and that’s why my father has such great feelings about the government. And why and the reason I don’t – is because I saw that switch. Like all of a sudden it went from ‘what can I do’ for you to ‘what are you going to do for me’.
It was about 20 years ago. 20 years ago all of a sudden it was like – “Have you filled out form 12 CB? I’m sorry, oh, and I think you have to talk to this regulator too. Because I don’t think we’re going to allow you to have a party there!”
China’s old government under Wen Jiabao was free. They said: a few of you will get rich first – let’s create a harmonious environment, let’s grow, let’s have free markets. That was awesome and it created 40 years of prosperity. And China is like one of the most advanced countries in the world now.
Well now they have the opposite. They have a control freak government, or at least the guy at the top and that permeates the government. They’re not letting money out, they’re not letting people use crypto, they’re not letting people use Bitcoin to pay.
And what that does is – it pushes out all the best entrepreneurs, pushes them to wherever. And it creates more poverty there because all of those people then are constrained. If you’re constrained – you’re poorer. If they say you can’t move – you’re going to starve. And that’s pretty much what too much regulation will do for you. And so that’s China.
Well, it makes no sense. I mean if you’re going to run something on the Blockchain, you’re going to need Bitcoin to do it. If you’re going to do something in Bitcoin – it’s using the Blockchain. These are intertwined.
Now, there are some other Blockchains being created, which is great. Competitive Blockchains. I’m a believer. And, you know, having competition because I as a consumer end up with the better service. But somehow trying to separate those and say oh we’re gonna allow all the technology in, we’re just not going to let you use it. What are they thinking? They’re basically saying: yeah, go keep creating stuff – we’re not going to let you use it and we’re not going to let you have money leave our country.
So where’s the benefit for an entrepreneur there? That’s why they’re all buying houses in Palo Alto. All the Chinese are saying: well, let’s get out of there. Or they’re moving to Japan where they’re welcome. All the young people are moving to Japan. They’re saying: “Well, wow, this government accepts Bitcoin as a national currency! I want to be a part of that!”
I talked to the Prime Minister of Kazakhstan. And I told him about Estonia and all of these interesting virtual governance thing that can happen. And I said that Kazakh means free. It should be free country. You want this to be free because you’ll end up with a wealthier, more prosperous country.
And, why not have a certain number of Kazakhs, but then a billion virtual Kazakhs. And have them all be a part of your world and compete with all those virtual countries for them.
And he was all for it. So I thought that was going to happen. Now, some lower down regulator has now tried to heavily regulate crypto and that it’s a proposal. It’s not law. And hopefully he’ll just be slapped down and, you know, sent on his merry way. He’s like the old world regulator, who doesn’t get that you’ve got to have a very light touch when you’re regulating an ICO.
It should not be the equivalent of an IPO. An IPO affects hundreds of thousands of people. The companies are worth tens of billions of dollars. An ICO is usually, you know, two girls and a dog.
It’s not like we have to protect everybody from themselves. It’s just people getting going.
Who is listening to him? This guy just opened up! He opened up all that information, he made it dangerous. So, wait, this is totally counter what I thought would be his philosophy, which is: we’re open, transparent, this is the way the world should be, it’s open, and transparent, and decentralized, and whatever… Bitcoins perfect for that. So he’s, I don’t know, why you even listening to that guy?
Do we listen to the guy who runs the biggest bank in the world? When he says, we shouldn’t use Bitcoin – well why listen to that? Because the guy is realizing that people are taking pieces 1 percent, 2 percent, 5 percent of their money out of his bank and putting it into crypto. So he’s totally disinterested, and he is very nervous that he’s going to lose all those customers. And he will. Over time he will.
It just feels like crypto generally will replace all fiat. Because it’s just better currency and all the best engineers in the world are working on that. They’re not working on how to improve services for the dollar.
It is a hundred trillion dollar market. So that means, that we have a long way to go in a crypto market. We’re now in the hundreds of billions, it’s like it’s got a thousand times on what it is now to go.
I like competition. I think it’s great. I think Bitcoin is clearly the leader. And it will be the standard by which all the other currencies will have to compete. It’ll be the equivalent of Microsoft. But it could end up being Yahoo for search, you know, where Google came in and got a bigger share. So things can happen! But, when you have that front position and whenever there’s a new technology you add it to that currency.
It’s very likely that Bitcoin will be the largest and biggest currency because they have a network effect. It grows as the network grows.
I like the idea that they’ll all have to compete with each other. And I like the idea that they’ll all be tradable into each other. And, you know, and now they’re tradable into fiat too. But I think that’ll be less important over time, I think more important – more companies like you can get a Kentucky Fried Bitcoin bucket, which is only available to be paid for in Bitcoin in Canada. And then there are all these houses and yachts and whatever – that are all only available in Bitcoin, you can’t pay dollars for them. I think more and more that’ll happen. And we’ll be in a position where people laugh at you if you try to pay fiat currency for your coffee.
Whenever I hear this volatility question, I think, one Bitcoin is still just worth one Bitcoin. It is very stable. All these other currencies, these fiat currencies, there are volatile against it. Falling away. Over time.
And so, when they say volatility, I think they are panicking: they go up, they go down. One Bitcoin is still one Bitcoin and it will continue to be. And so I think, I am not really thinking that it is volatilizing, I am thinking that it is Bitcoin and it should be spent, as you need to spend it.
Der britische “Economist” hat seine Titelgeschichte in dieser Woche Deutschland gewidmet: “Cool Germany”. Berlin-Korrespondent Jeremy Cliffe erklärt, was an Deutschland cool ist und warum er dem Land eine gute Zukunft zutraut.
n-tv.de: Ihre Zeitschrift, der “Economist”, nennt Deutschland auf seinem Titel in dieser Woche “Cool Germany”. Was ist “cool” an Deutschland? Normalerweise finden wir uns eher nicht cool.
Jeremy Cliffe: Das habe ich in meiner Zeit in Deutschland gemerkt – die Deutschen halten sich nicht für cool. Aber wenn man sich die langfristige Entwicklung dieses Landes anschaut, findet man viele Tendenzen, die zu einer coolen Gesellschaft gehören. Deutschland ist als kulturelle Marke durchaus stark – deutsche Fernsehexporte wie “Deutschland 83” oder “Babylon Berlin”, deutscher Sport, Tourismus nach Deutschland, das ist alles sehr beliebt. Aber politisch gilt Deutschland überhaupt nicht als cool.
Wie meinen Sie das?
Für den linken Flügel der Politik in Ländern wie Großbritannien und den USA ist Deutschland das Land, das Südeuropa während der Eurokrise unterdrückt hat. Und es ist das Land, in dem eine Partei wie die AfD die dritte Kraft werden konnte. Aus rechter Perspektive gilt Deutschland als chaotisches Land, das aus reiner Sentimentalität gefährliche Einwanderer ins Land gelassen und dabei seine Stabilität und seinen Zusammenhalt verspielt hat.
Und diesen Menschen wollen Sie erklären, dass Deutschland ganz anders ist?
Wir sprechen auch ein deutsches Publikum an – wir haben hier Zehntausende Leser. Aber vor allem richten wir uns an unsere Hunderttausenden Leser anderswo in der Welt. Ihnen wollen wir sagen: Deutschland ist anders, als ihr glaubt. Das alte, autoritäre und konservative Deutschland, das viele Menschen weltweit noch im Kopf haben, hat sich gewandelt und ist noch immer im Wandel begriffen.
Und das ist ein positiver Wandel?
Die deutsche Gesellschaft wird aufgeschlossener, sie wird internationaler, moderner, selbstbewusster und pluraler. Der “Economist” steht sehr stark für offene Gesellschaften. Diese Tendenzen finden wir daher gut. Es gibt bestimmt Herausforderungen – pluralere Gesellschaften sind häufig gespaltene Gesellschaften. Aber die Tatsache, dass Deutschland diese Herausforderungen jetzt angehen muss, finden wir nicht schlecht.
Die deutsche Gesellschaft ist auch aggressiver geworden. Die Auseinandersetzung über die Flüchtlingspolitik wird hierzulande teilweise sehr heftig geführt.
Das stimmt, und das unterschätzen wir nicht. Aber die größere Gefahr ist, vor allem in den internationalen Medien, dass dieser Aspekt überschätzt wird. Das gilt nicht nur für Medien wie den US-Sender Fox News oder britische Boulevardzeitungen, sondern auch für die Qualitätspresse in Großbritannien: Deutschland wird häufig so dargestellt, als herrsche infolge der Flüchtlingskrise im Alltag reines Chaos. Bestimmt gibt es ein “Unbehagen”, wie die Kanzlerin es genannt hat. Aber Chaos, Verbrechen, Terror und Gewalt? Ich habe ziemlich viel Zeit in der deutschen Provinz verbracht. Das ist einfach nicht der Fall. Es gibt ein großes Spektrum von Meinungen über die Flüchtlingspolitik und generell über die Öffnung der deutschen Gesellschaft. Viele Bürger sind sogar in sich gespalten. Aber das ändert nichts an der allgemeinen Analyse, dass Deutschland insgesamt in eine eher positive Richtung geht und, wichtiger noch: in eine viel positivere Richtung, als viele im Ausland denken.
Warum schauen Sie mit so viel Optimismus auf Deutschland?
Nun, auch wenn man die allgemeinen Tendenzen für positiv hält, kann man über die Politik dieses Landes deprimiert sein. Ich war sehr deprimiert während des Wahlkampfes. Das TV-Duell war das langweiligste Fernsehereignis, das ich je erlebt habe. Viele wichtige Debatten, die Deutschland in dieser Übergangsperiode führen müsste, fanden dort nicht statt. Das Ausland wurde nicht erwähnt, Europa wurde nicht erwähnt, über Deutschlands Verteidigungsverantwortung wurde kaum gesprochen. Es ging viel um Einwanderung, aber Debatten über die Identität Deutschlands gab es nicht. Man kann viel Gutes über die Kanzlerin sagen. Aber dass sie so konfliktscheu ist, dass sie so sehr auf Konsens setzt und sich nur ungern in echte Debatten begibt, das passt nicht zu dem historischen Moment, in dem Deutschland sich befindet.
Woher nehmen Sie dann Ihre Zuversicht?
Der Optimismus hat mit den Veränderungen der letzten Monate zu tun. Auf einmal gibt es große Debatten über die Identität und die Zukunft des Landes. Auch wenn wir als “Economist” nicht immer einer Meinung mit den Protagonisten sind, finden wir diese Debatten gut. Deutschland braucht eine Wiederbelebung der Politik. John Kornblum, der frühere US-Botschafter in Berlin, hat mich auf einen interessanten Rahmen der deutschen Nachkriegsgeschichte hingewiesen: Alle 25 oder 30 Jahre macht dieses Land einen Wandel durch. Die Adenauer-Zeit war geprägt von einer Restauration. Es folgte die Zäsur von 1968, dann die Deutsche Einheit und die Herausforderungen der 1990er Jahre. Jetzt, dreißig Jahre nach der Wiedervereinigung und zwanzig Jahre nach dem Ende der Kohl-Periode, befindet Deutschland sich in einem neuen Übergang. Dass sich so viel in Deutschland verändert, birgt Risiken und Herausforderungen, aber auch Möglichkeiten – und über die wird in Deutschland zu wenig gesprochen.
Ist Angela Merkel die richtige Kanzlerin, um eine solche Debatte zu führen und anzuführen?
Als Engländer sollte ich anderen Ländern schlechte politische Führung grundsätzlich nicht vorwerfen. Und ich würde die positiven Eigenschaften der Kanzlerin nie unterschätzen. Aber ich glaube, sie passt eher zu der Periode, die gerade zu Ende geht – eine Zeit, in der die großen Veränderungen der 90er Jahre und der rot-grünen Regierungszeit gefestigt werden mussten. Für eine Periode der Konsolidierung war Frau Merkel die perfekte Kanzlerin: unpolitisch und konfliktscheu, sie hat die Wähler beruhigt. Aber sie erklärt nicht und gibt keine Richtung vor. Aber jetzt ändert sich die Lage. Kaum jemand glaubt, dass die Kanzlerin noch einmal antreten wird. Ob sie schon in einem oder in zwei Jahren oder erst 2021 ihr Amt abgibt, das wissen wir nicht, aber wir können davon ausgehen, dass die Merkel-Ära endet.
Wie geht es nach Merkel weiter?
Es sieht so aus, als komme jetzt eine neue Generation von Politikern nach vorne, die stärker zu politischen Auseinandersetzungen bereit ist. Das gilt sowohl für den rechten Flügel der Politik – für Jens Spahn, Julia Klöckner, sogar für Annegret Kramp-Karrenbauer. Unter den potenziellen Merkel-Nachfolgerinnen ist sie der Kanzlerin am ähnlichsten, aber auch sie hat mehr Kampfbereitschaft als Frau Merkel. Und auch auf dem linken Flügel der Politik nimmt die Bereitschaft zur Debatte zu. Ich war in Bonn, als Andrea Nahles versprochen hat, mit der Union zu verhandeln, “bis es quietscht”. Dann gibt es interessante Figuren wie Robert Habeck bei den Grünen. Nach meinem Eindruck braucht der linke Flügel der deutschen Politik einen neuen Joschka Fischer. Er selbst sagte mir übrigens, er glaube, Habeck habe die besten Aussichten, ein neuer Joschka Fischer zu werden. Kurzum: Es gibt Politiker, die das Zeug haben, die wichtigen Debatten zu führen und die Bürger mitzureißen. Solche Führungsfiguren braucht Deutschland jetzt – Politiker wie Joschka Fischer oder Gerhard Schröder.
Wollen die Deutschen wirklich solche Politiker? Sind wir konfliktbereit genug, um einen zweiten Schröder zu vertragen?
Natürlich ist Deutschland noch immer stärker am Konsens orientiert als alle anderen Länder des Westens. Aber die Bürger haben einen neuen Bundestag gewählt, der viel Konfliktpotential hat. Der gemeinsame Wille der deutschen Bevölkerung ist es, dass jetzt sieben Parteien im Parlament sind. Aber auch, wenn die Bürger keinen Streit wollen: Manchmal müssen die Impulse von der Politik kommen. Die Hartz-IV-Reformen waren nicht beliebt, sie haben das Land polarisiert. Aber es war die richtige Entscheidung für das Land. Das erkennen viele Menschen – wenn auch nicht alle – erst jetzt.
Die SPD hat sich bis heute nicht von Schröders Hartz-Reformen erholt.
Das stimmt. Schwierige Entscheidungen können politische Kosten haben. Aber in der Politik geht es nicht nur darum, politisches Kapital anzuhäufen – das ist ein sehr typisch deutsches Verhalten: sparen ohne zu investieren. Es ist wie beim Geld: Politisches Kapital, das nicht eingesetzt wird, ist nutzlos. Schröder hat sein politisches Kapital für Hartz IV ausgegeben, aber auch für gesellschaftliche Reformen. Oder Joschka Fischer und seine Kosovo-Rede auf dem Bielefelder Parteitag 1999. Beliebt hat er sich damit nicht gemacht, aber es war eine moralisch richtige Entscheidung.
Merkel ist nach der Präsidentschaftswahl in den USA als neue “Führerin der freien Welt” bezeichnet worden, aber sie schafft es nicht einmal, sich mit Emmanuel Macron auf eine Reform der EU zu einigen. Ist nicht wenigstens das Grund zu Pessimismus?
Da sind wir wahrscheinlich am pessimistischsten. Was wir zutiefst bedauern ist, dass “der neue Aufbruch für Europa”, wie Union und SPD ihren Koalitionsvertrag genannt haben, verloren geht. Besser als Macron wird es in Europa nicht werden. Macron hat eine Art Vertrag mit der französischen Bevölkerung: Wenn Frankreich sich auf schwierige wirtschaftliche Reformen einlässt, dann kauft das Land damit Glaubwürdigkeit in Berlin, um zusammen mit Deutschland ein nachhaltigeres Europa zu schaffen. Das wird von zu wenigen deutschen Politikern erkannt. Wenn jetzt keine Taten folgen, dann wird ein großer Moment in der europäischen Geschichte vergeudet.
Was sagen Sie einem Freund in Großbritannien, der Sie beim Bier oder beim Tee fragt, wie die Deutschen eigentlich so sind?
Das ist genau die Frage, die wir mit unserer Titelseite beantworten wollen.
Sie sagen dann: “Cool”?
Ja. Okay, vielleicht sage ich auch: “Cooler als du denkst.” Deutschland ist viel bunter und entspannter, als man im Ausland annimmt. Die vorherrschenden Klischees über Deutschland sind immer noch die aus der Zeit von Helmut Kohl: Bratwurst, Lederhose, formelle Umgangsformen, sozial konservativ, ethnisch homogen, wenig Integration, viele Regeln. Und das stimmt einfach nicht mehr.
Mit Jeremy Cliffe sprach Hubertus Volmer
PayPal is quietly rolling out basic banking services to some of its U.S. customers, which include a debit card and the ability to deposit checks – alongside the loans which were already available. For customers who accept, their PayPal balances also become protected by Federal Deposit Insurance Corp (FDIC) insurance.
Surprisingly, PayPal has found a way to do this without a U.S. banking license …
The WSJ reports that it has partnered with a number of licensed banks whose own branding remains hidden.
The FDIC doesn’t backstop funds stored at non-banks, and Visa and MasterCard only permit cards that run on their network to be issued by banks.
So the company turned to a hodgepodge of small banks that stay anonymous and behind the scenes. It cut deals with a Delaware bank to issue debit cards, a Georgia bank to deposit checks instantly after users take a photo of them and banks in Utah to make loans to consumers and small businesses.
There are no monthly banking fees, but some services do attract charges. The company says that the service is aimed at those who do not currently have bank accounts.
Users will have to pay a fee to take their money out from ATMs not in PayPal’s network, in addition to 1% of any check they deposit via taking a photo with their smartphone.
It follows a rollout of peer-to-peer PayPal payments in Messenger last year.
As the piece notes, a number of companies have been moving in this direction. I even speculated that Apple might do the same. Some objected on the basis that banking is a low-profit business, but then so is music streaming. The question would be whether Apple felt it would be a useful element of the ecosystem.
A subsidiary of Foxconn Technology Group, FIH Mobile, has agreed to help develop the Blockchain phone, called the Finney.
Foxconn is a multinational electronics contract manufacturing company based in Taiwan. It is one of the largest employers worldwide and some of its major customers have included Apple, Google, Cisco, Huawei, and Amazon.
The smartphone is designed to enable users to securely store and use digital currencies. Sirin CEO Moshe Hogeg stated that with current methods of storage, the use of digital currencies is difficult and unintuitive. “…the mass market would never get it. There’s no chance my mom can figure out how to use Bitcoin, and my mom is smart.”
The device will integrate a plethora of different tokens. It will also allow owners to shop on crypto-friendly websites like Overstock.com and Expedia, converting cash into specialized tokens if needed. Sirin said that users may eventually be able to forgo complex addresses and long private keys, and instead verify their identities on coin-related services with an iris scan, fingerprints, or even a simple password.
Sirin raised $158 mln for the project in December via an initial coin offering (ICO) following $70 mln in initial investment. In October Sirin plans to ship the first units to eight new stores in locations with the most active crypto communities like Turkey and Vietnam. The Switzerland-based consumer electronics company hopes to license the technology to other phone manufacturers, which could decrease the price, making the device more available.
As Cointelegraph reported in March, Huawei was in discussions with Sirin Labs, reportedly regarding the license for Sirin’s operating system. While Sirin Labs have confirmed on their Telegram channel that the meeting took place, no detailed announcements have been made regarding the discussions.
“Success no longer goes to the country that develops a new fighting technology first,
but rather to the one that better integrates it and adapts its way of fighting….”
The US National Defense Strategy (2018)
[Could not have said it much better; worth reading – TJACK]
by Peter Newell
One of the central military questions of our age is how to utilize new ways of thinking about driving defense innovation. And the conversation has moved fast. With the release of the new National Defense Strategy, the discussion no longer revolves around just technology and offsets. Instead, it recognizes that what will count most will be the speed at which someone recognizes an emerging problem, articulates it in a language others broadly understand, assembles the right team to build a pathway toward a solution, and delivers that solution to the battlefield.
In a recent episode of “The Innovators” podcast, I talked about how my passion for understanding battlefield problems developed during my military career. I also discussed how the work Steve Blank and I are doing led us to develop the concept for government-focused innovation pipelines, end-to-end innovation processes that deliver products at speed (versus disconnected innovation activities).
In the process of defining these innovation pipelines we observed that there are distinct types of people who actually drive innovation in the military’s ecosystem: makers and innovators, entrepreneurs, and innovation gurus. Here’s how they work and our ideas on how their expertise can be harnessed to support our national security objectives.
At the tactical level in every organization, you can find makers and innovators. They are the people at the grassroots level who constantly tinker with things to figure out how they work. They code during their work breaks. In their barracks, you can find parts and pieces of a robotics or drone project. On weekends, they can be found in a machine shop modifying a piece of equipment to better fit their personal needs. They are ingenious, passionate about their ideas, and driven to create new things. Makers and innovators are found most often in the tactical echelon of innovation. However, they show up in other interesting places as well.
One example of a maker and innovator, U.S. Army Staff Sgt. Yates, turned up at one of the Rapid Equipping Force’s deployable labs in Afghanistan with an idea to improve the bipod for an M249 Squad Automatic Weapon (SAW), a light machine gun. He had no prototyping skills other than his ability to sketch and describe his idea. What he did have was an idea and a desire to do something with it.
Another example is found in U.S. Air Force Staff Sgt. Cat Norcom. She is an air refueling jet boom operator from Travis Air Force Base. One of the founding members of the Travis Air Force Base Phoenix Spark Lab, she is a self-taught coder who can program in four languages. When we met, she explained to me, over the pieces of a power supply system that was inadequate for their mission parameters, how she was looking for potential pathways to increase its operating threshold. When we met recently in Palo Alto, she was just about to run the first set of tests on a new prototype that could eventually deliver a 50 percent improvement over the current configuration.
Makers and innovators are motivated by the opportunity to explore, learn, and gain feedback on their ideas and gadgets. They celebrate finding new tools to use and flock to pop-up classes to learn the latest techniques about everything from new coding languages to the newest welding techniques.
These people are motivated by the adventure of learning and the thrill of the hunt for a new problem to solve, not by awards. Fortunately, there are efforts emerging in the services to support their efforts to find and solve problems like the ongoing Marine Corps Innovation Boot Camp, the Air Force Phoenix Spark and Kessel Run programs. In other cases, tactical commanders like Army Col. John Cogbill, have taken matters into their own hands.
Cogbill, a former Stanford University fellow who participated in the first Hacking for Defense class, has imported the course’s methodology into the brigade he now commands at Fort Campbell. Teams across his brigade take on problems they have internal to the unit like replacing hard to get tools or reconfiguring command and control nodes to allow them to be more agile. Acting on recommendations of a junior officer, they have created a partnership with Vanderbilt University’s Engineering School and now have university students helping to design and print parts for soldiers’ innovation efforts.
Having ideas is not enough to drive innovation. As Steve Blank has discussed, it takes entrepreneurs who can build teams of people around ideas and discipline those teams to turn an idea into a product against a deadline. Entrepreneurs have tightly connected, trusted networks that they use to thread their efforts through their organizations’ bureaucracies. Entrepreneurs are experienced in the tools of search and discovery needed to build pathways and are well versed in measuring risk against opportunity. They have the respect and trust of their supervisors built on years of experience in their organizations. Like makers and innovators, they are passionate about their latest projects and often consumed with an omnidirectional desire to see them through to completion.
Entrepreneurs operationalize innovation within organizations. They make stuff happen.
U.S. Marine Corps Maj. Chris Wood is a great example of an entrepreneur. He has figured out how to grow nascent ideas for innovation into full-scale productions within the Marine Corps. Two years ago, Wood was trying to simply connect Marine maintainers to one another so they could share their designs for printed parts for their equipment. He subsequently grew that effort into a full-fledged, institutionally supported Marine Maker movement. His portfolio today has expanded to include the Marine CoLab effort as well as a stake in the Marine Corps vision for additive manufacturing.
Many but not all entrepreneurs have been makers and innovators. But relatively few makers and innovators will ever be entrepreneurs. Entrepreneurs are impassioned and motivated by the complexity of the opportunity, size of the impact of the solution, and the all-consuming battle it takes to turn an idea into a deliverable product. There is no set pathway to becoming an entrepreneur, no set experiences, and definitely no set character traits other than an ability to think critically, judge risk vs. opportunity, and act decisively. Largely the hunt for a harder problem to solve and a bigger impact to make is what motivates them. They do not fear failure. Rather they embrace it, recognizing the value of failure as a learning process.
For lack of a better term, innovation gurus are the people who build and discipline innovation pipelines. They have been entrepreneurs with multiple successes and failures alike. They know every path through the pipeline and every obstacle that lies along it. While it’s not their job to carry the load for the entrepreneurs in their organization, they will make sure the entrepreneurs are properly prepared and balanced for the journey. It usually takes decades of experience to become an innovation guru.
Innovation gurus are responsible for identifying and quickly reducing organizational obstacles to innovation. They capture lessons learned and own the organizational doctrine that establishes the common language that drives the culture of innovation within their domain. Innovation Gurus are organizations’ innovation strategists.
Today’s growing national security innovation insurgency owes it roots to so many innovation gurus, many of whom I have been lucky to know.
I met Ben Fitzgerald while he was at the Center for New American Security championing the first of what would be a series of working groups supporting a study looking beyond the third offset strategy, the Defense Department’s plan to retain the U.S. military’s technological edge. Ben went on to serve as a professional staff member in the Senate Armed Services Committee before he was hired as the director of the Pentagon’s Office of Strategy and Design, essentially making him the chief innovation strategist for Under Secretary of Defense Ellen Lord.
Defense innovation made a major leap forward this year. Renowned innovation gurus Bruce Jette, Hondo Guertz, and Bill Roper became the assistant secretaries for acquisition in the Army, Navy, and Air Force respectively. All three have built innovation pipelines and are incredibly experienced at bending government bureaucracy to their will. As a colonel, Jette pioneered the creation of U.S. Army Rapid Equipping Force, an organization I led from 2010 to 2013. He was the epitome of the Army’s modern entrepreneur. Guertz is well-known for championing major changes within the special operations community that led to their agile acquisition programs as well as the establishment of Special Operations Forces Works (SOFWERX). Roper was the founding director of the Defense Strategic Capabilities Office, which was originally responsible for taking the Defense Department’s existing technologies and combining them into new capabilities.
It is encouraging to know that today there is a robust human capital ecosystem that drives innovation within the military. Unfortunately, the innovators and makers who feed it, the entrepreneurs who drive it, and the gurus who guide and discipline it are largely self-made. While their efforts in getting an innovation program deployed are heroic, their numbers fall far short of those produced in very deliberate programs that China and Russia run. To our hundreds of self-made entrepreneurs, China and Russia are producing tens of thousands of their own who already have the capacity to significantly challenge our technological advantages on the battlefield.
Fortunately, there are some things the U.S. armed services can do to better leverage and grow the ranks of the makers and innovators, entrepreneurs, and innovation gurus we need to meet the innovation demands of the coming century.
First, it’s long past time to make hacking, making, and innovating intramural sports in the military and give it same support and prestige they do to combatives, marksmanship, and other critical individual skills. Thinking through a problem and delivering a timely response should be as important as putting steel on a target.
Second, the Pentagon should demand that the universities on military installations provide science, technology, engineering, mathematics, and entrepreneurship course options to servicemembers. For example, there should be an associate’s degrees program in advanced manufacturing and a degree program for national security innovation and entrepreneurship available on any military installation that offers college courses. And, of course, the services need to do the same within the professional military education system.
Third, to support the new courses it is time to establish educational facilities on installations where for-credit and pop-up educational activities like “hands-on” coding, prototyping, and advanced manufacturing skills are taught during and after duties hours. Open those activities to support unit level training and competition between classes.
Fourth, the Defense Department should expand successful entrepreneurial activities like Marine Makers, Phoenix Spark, and Hacking for Defense, and deliberately connect them into pipelines that deliver both innovation and people with broad networks they will leverage in the future.
Fifth and finally, it is time to expand on the concepts pioneered by programs like Kessel Run and Hacking for Defense to include fellowships outside the government for senior officers and non-commissioned officers focused on creating entrepreneurial response mechanisms to technical and policy-related problems.
Only by harnessing the collective passion and motivation of innovators and makers, entrepreneurs and innovation gurus alike does it becomes possible to drive innovation across an organization. We have found this to be especially true within the Defense Department and the intelligence community where integrating and adapting on the battlefield is most important.
Peter A. Newell (@PeterANewell) is the managing partner of BMNT Partners, a Silicon Valley based company that provides a platform where innovators can work together at the intersection between business, government, academia and society. He is a recently retired U.S. Army Colonel and the former Director of the U.S. Army Rapid Equipping Force.
The European Commission’s (EC) Digital Day 2018 has led to the signing of a Declaration to create a European Blockchain Partnership made of up 22 countries, according to an April 10 European Commission press release.
The press release reads that the Partnership will be a “vehicle for cooperation amongst Member States to exchange experience and expertise in technical and regulatory fields and prepare for the launch of EU-wide [Blockchain] applications across the Digital Single Market for the benefit of the public and private sectors”
Commissioner for Digital Economy and Society Mariya Gabriel spoke of the potential for Blockchain technology to be integrated into existing industry:
“In the future, all public services will use [Blockchain] technology. Blockchain is a great opportunity for Europe and Member States to rethink their information systems, to promote user trust and the protection of personal data, to help create new business opportunities and to establish new areas of leadership, benefiting citizens, public services and companies.”
The topic of regulation for Blockchain technology was also addressed in the press release, which stated that the Partnership will “contribute to the creation of an enabling environment, in full compliance with EU laws and with clear governance models that will help services using [Blockchain] flourish across Europe.” The EC reported in early March that they would be releasing a EU-wide fintech and Blockchain framework.
The participating states that have signed the Declaration for the Blockchain Partnership are as follows: Austria, Belgium, Bulgaria, Czech Republic, Estonia, Finland, France, Germany, Ireland, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, and the UK. The press release adds that other members of the EU and the European Economic Area are also invited to join.
In early February, the EC launched the EU Blockchain Observatory and Forum, which Gabriel called “one of the world’s most comprehensive repositories of [Blockchain] experience and expertise.”
The press release notes that the EC has invested more than 80 mln euros (around $98 mln) in Blockchain-related projects, with around 300 mln euros (around $371 mln) to be alloted for Blockchain development by 2020.
Der Desktop von Xenialpup: Aufgeräumt und reduziert – und sehr nah an Windows. Die Statuszeile unten gibt Rückmeldung über verschiedene Daten, links öffnet sich die zentrale Navigation. Und auch die sieht so aus wie einst in Windows bis Win7.
Sie sind sentimentaler Besitzer eines seit Jahren ungenutzten Staubfänger-PCs, den nichts und niemand wieder zum Laufen bringen kann? Ihnen kann geholfen werden: Xenialpup lässt selbst PC-Dinosaurier auferstehen.
Neben großen, vollwertigen Betriebssystemen gibt es auch etliche Versionen von Linux, die äußerst anspruchslos sind: Sie sind dazu gedacht, klein dimensionierte Hardware anzutreiben oder alte Schätzchen wieder nutzbar zu machen. Die kleinsten dieser Linux-Distributionen sind so schlank, dass sie selbst 25 Jahre alten Rechnern bis dahin ungeahnte Leistungen entlocken.
Eines der bekanntesten Mini-Linux heißt Puppy, und in seinen sparsamsten Formen kommt es mit 128 MB Arbeitsspeicher aus. Mit Puppy kann deshalb man sogar Computer reanimieren, die zu Anfang des Jahrtausends auf den Markt kamen.
Wir wollen Ihnen aber eine etwas aufgebohrte Variante von Puppy vorstellen, die zwar ebenfalls bescheidene Systemanforderungen stellt, aber trotzdem eine Menge kann: Xenialpup.
Das Puppy-Derivat Xenialpup: Aus alt mach schnell
Xenialpup braucht einen Rechner, der es mindestens auf 1 GHZ Taktfrequenz bringt und über 768 MB Arbeitsspeicher verfügt. Man kann das System installieren, aber auch über CD oder USB-Stick laufen lassen. Im Extremfall brauchen solche Puppy-Systeme also nicht einmal eine Festplatte. Solche Minimalanforderungen dürften die meisten PCs und Notebooks bis zu einem Alter von 15 Jahren und mehr einschließen, die in deutschen Kellern ihrer Entsorgung entgegengammeln. Xenialpup hat das Zeug, sie stattdessen nutzbringend zu recyceln.
Denn Xenialpup ist beeindruckend leistungsfähig. Optisch reduziert und sehr einfach gestaltet, bietet das System eine wenige Dutzend Anwendungen umfassende Software-Sammlung, die aber so gut wie alles abdeckt, das man für Internet, Schreiben, Musik oder Video-Streams braucht.
Tatsächlich arbeitet hier ein extrem reduzierter Betriebssystem-Kern, der auf Ubuntu 16.4 beruht. Damit ist Xenialpup in der Lage, sowohl 32-bit-, als auch 64-bit-Rechner anzutreiben. Die Installation gelingt auf älteren BIOS-Systemen, wie auch auf neuen UEFI-Rechnern. Und die Bedienung ist – man kann das nicht anders sagen – wie bei Windows.
Xenialpup wurde mit dem Anspruch entwickelt, ohne Linux-Vorkenntnisse sofort und ohne Erklärungen bedient werden zu können. Das ist fast perfekt gelungen. Anders ist hier nur, dass man, um Dateien aufzurufen oder Programme zu aktivieren, grundsätzlich nur einen Mausklick braucht statt eines Doppelklicks. Anfangs ruft man so versehentlich vieles doppelt auf, bis man sich daran gewöhnt (oder es in den Systemeinstellungen umstellt).
Die wirklich herausragende Eigenschaft von Xenialpup ist seine Geschwindigkeit. Da das Betriebssystem – wie einst bei DOS – komplett in den Arbeitsspeicher geladen wird, stehen seine Funktionen ohne jeden Zeitverlust zur Verfügung. Das fühlt sich an wie ein Turbolader für Alt-Hardware.
Wie bekomme ich Xenialpup auf den Uralt-PC?
Der Witz an Puppy ist, dass man es noch nicht einmal installieren muss. Es ist so klein, dass man es bequem über CD oder USB-Stick starten kann. Das ist praktisch, um es auszuprobieren. Zur Reanimierung von Alt-Hardware bietet sich aber die klassische Installation an.
Der erste Schritt ist natürlich der Download: Xenialpup ist nur 330 MB klein.
Jedes Brennprogramm kann aus der heruntergeladenen ISO-Datei ein sogenanntes “Abbild” brennen: Die CD oder DVD, die man so erhält, ist bootfähig und bietet dann auch die Installation auf Festplatte an.
Alternativ lässt sich auch ein bootfähiger USB-Stick produzieren. Das passiert in vier Schritten:
Der Rest ist einfach:
Den Rest lernt man in den folgenden 30 Minuten. Einen ersten Überblick über Xenialpup bietet Ihnen unsere Bildergalerie. Viel Spaß mit dem reanimierten Rechner!
Willkommen: Der Erststart öffnet das Fenster mit den grundsätzlichen Konfigurationen. Sprachumstellung und – wichtiger noch! – die Tastaturumstellung unten sollte man direkt erledigen, sonst fehlen die Umlaute, Funktionstasten sind anders belegt und Y und Z vertauscht.
Auf fast jede “Frage” antworten Puppy-Systeme wie Xenialpup mit einem Assistenten. WLAN erkennt das System mitunter erst nach einer regulären Installation, Kabelverbindungen zum Internet laufen völlig problemlos. Falls es nicht klappt, bietet Xenialpup sofort ein Ersatzwerkzeug für einen erneuten Versuch an.
Das sehr reduzierte Software-Center von Xenialpup: Installiert und desinstalliert wird, wie bei Linux üblich, zentral. Das ist gut, weil alles geordnet vorliegt und in sichereren Versionen angeboten wird. Ab Auslieferung bringt Xenialpup ein paar Dutzend Programme mit – im Grunde ein Vollangebot der Notwendigkeiten plus ein paar Bonbons.
Browser PaleMoon: Das reduzierte Design zieht sich durch alle Programme hindurch, sagt aber nichts über die Leistungsfähigkeit aus. Alle pragmatischen Anwendungen laufen merklich schneller als in manchem “vollen” Betriebssystem. Warten muss man auf keinen Programmaufruf, es fühlt sich eher an wie ein Anschalten. Kein Wunder: Xenialpup lädt seine Anwendungen komplett in den Arbeitsspeicher.
Und auch, wenn es multimedial wird, lässt einen der Betriebssystem-Winzling nicht hängen. Video-Streams sind kein Problem und laufen ruckelfrei. Und der mitgelieferte Videoplayer MPV verdaut selbst HD-Videos problemlos, wenn CPU und Arbeitsspeicher nicht zu klein und archaisch ausfallen. Auch Musik ist überhaupt kein Problem: Viele Nutzer reanimierter Alt-Systeme setzen sie für die Party-Beschallung ein.
Grafikprogramm Paint: Wie auch die mitgelieferte Office-Software sieht das ein wenig aus der Zeit gefallen aus. Dafür funktioniert aber alles zuverlässig: Systeme wie Xenialpup haben ihre Grenzen, aber was sie anbieten, das können sie auch.
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