Conference focused on new use cases for cryptographic assets
An inaugural conference focused on new use cases for cryptographic assets showcased today how blockchain-based applications that serve actual needs may be on the horizon. But not everyone at Token Summit agreed on the market's direction. As panel after panel of entrepreneurs took the stage in New York, some in the audience remained skeptical — while even the panelists themselves expressed a note of caution. To kick off the event, hosted at the NYU Stern School of Business, one of the earliest innovators in the crypto space, Erik Voorhees — who sold his first bitcoin company, Satoshi Dice, in 2013 – revealed more details about digital currency exchange ShapeShift's new product, Prism. Addressing the critics who say the cryptocurrency boom is little more than speculation, Voorhees positioned the work as part of the foundation for the next Facebook and Google.
Voorhees said:
"The real use cases will come in the future, but if this technology is going to make an impact, there should be speculation today."
Following Voorhees' addressed a number of panels continued with the theme of building real-world applications based on blockchain technology.
To build a real blockchain app
Speaking at the event, Brian Armstrong, co-founder of Coinbase, doubled-down on a years-old theory: that the developing economy would be the first to adopt these distributed applications. His comments came after Coinbase demoed an ethereum-based messaging app, dubbed Token, at CoinDesk’s Consensus 2017 event earlier this week. It's a messaging app built with cryptocurrency tech under the hood — but perhaps more importantly, it also includes an interface that Armstrong described as the "equivalent of HTML", but for ethereum rather than the Web. According to Armstrong, the developing world — and its estimated 2.5 billion underbanked individuals — is the primary target market for the app.
"The main value of cryptocurrencies is bringing financial services to the developing world," said Armstrong. “That’s what we’re going to do with Token." Muneeb Ali, co-founder of Blockstack, which launched its decentralized browser this week, said his startup was seeking a similar goal: facilitating the development of new kinds of apps. To help get there, Ali announced that his company had offered a bounty to anyone who could find a bug between his application and decentralized storage providers IPFS, Sia and Storj. Storj founder Shawn Wilkinson downplayed the potential competition between the projects, instead positioning their work from an enemy-of-my-enemy perspective. "We're all ideologically aligned to crush Amazon and other centralized services," said Wilkinson.
Slow progress
If the event showcased one thing, it's that there's little doubt that the road ahead with be characterized by slow and likely difficult progress. Bitcoin-powered browser Brave has had a service live for months, and in six days will launch its initial coin offering for the Basic Attention Token (BAT). Brave advisor Ankur Nandwani took the stage to explain how the browser startup, which has already raised $4.5m in venture capital, will leverage the token in an attempt to change user behavior. Out of 1.5bn tokens that will be minted, 300m will be set aside in a "development pool" to incentivize content publishers and users alike to download the app, which blocks third-party advertisements.
"Once you have users on the platform, advertisers will come," said Nandwani. Another possible explanation, though, for the slow growth of the technology and adoption came from an audience member and blockchain consultant Tone Vays, an outspoken critic of many decentralized applications. Speaking to CoinDesk during a pause in activity on the stage,
Vays said:
"It's not about the application. None of these applications need decentralization. They are just using the hype of bitcoin’s technology to blow their valuations out of proportion."
Blockchain honeymoon
Indeed, Maker software engineer Andy Milenius cautioned the crowd of investors, entrepreneurs, and students about the potentially painful process that young crypto-investors will likely go through on their way to learning how to properly conduct due diligence on their investments. "They're going to learn, probably the hard way, what makes a good idea worth investing in," said Milenius. Citing the vast separation between what companies like Apple and Dropbox can provide and what their decentralized counterparts can offer, Blockstack founder Muneeb Ali went even a step further, predicting a period of large-scale failures by ICO-backed companies before any kind of decentralized Web becomes a reality.
Ali concluded:
"Right now, we are in the honeymoon phase."
Chuck Reynolds
Contributor
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