Michael Tidwell: It sounds like Leon and you have a bit of technical background.
Leon Fu: I’ve been in technical my whole life, but I’ve always been programming computers. I’ve had my own computer in the 80s before it becomes widespread.
Michael Tidwell: Pretty good technical background.
Then, Tai, even though you have no real industry technical experience, you’ve just been really exposing yourself to other information and blockchain information.
Tai Zen: Yes. I’ve also been an active trader for 10 years.
Mike Casey: A finance guy and a tech guy.
Michael Tidwell: One question we’d usually like to ask all the people that come our show is what a blockchain is.
The reason is the definition has really been evolving over the last couple of years with different perspectives. Maybe, it’s the same because you’re hanging out so much, but if you would briefly, what is your definition of it?
Leon Fu: Ok. I recognized almost immediately that this was a database. In fact, my first 10-15 years as a software developer was database development. I did secure databases. I wrote the sequel all day long. I did client-server applications in the 80s and the 90s. Therefore, I understood immediately that this was a decentralized database.
First of all, it was decentralized money. It was going to be used like that. Besides, I recognized the technology, so I also was an early investor in these altcoins too.
The reason is it could be used for a lot more than just money or a lot more than just what Bitcoin was using it for that we could use that same technique. Immediately, I was buying a bunch of altcoins within several months after I bought Bitcoin.
That’s what I recognize as a fundamentally distributed database. Not immediately, but within a week or so.
Mike Casey: Can I get your definition of a distributed database?
Leon Fu: From a technical perspective, in the most fundamental level, it is a way for a group of nodes or computers to agree on the state of the database without a central authority. To me, that is what a blockchain is.
Mike Casey: Can you think anyway it can be achieved that it’s still blockchain?
Leon Fu: You have to have all the properties of the blockchain.
Mike Casey: What are the other properties?
Leon Fu: Such as the immutability, the way that a bunch of people who don’t trust each other is able to arrive to agree on the state of the system. With the idea of a set of data or blocks linked together by hashes, GitHub already does
Michael Tidwell: Is GitHub a blockchain?
Leon Fu: GitHub is not a blockchain because it doesn’t have the proof of work.
Mike Casey: So the proof of work is a necessary component to run a blockchain?
Leon Fu: That’s arguable right now because people are having other ways of arriving at consensus too such as proof of stake, etc.
Mike Casey: Sure. That’s why we ask the question because some people consider this blockchain, but some people don’t.
Michael Tidwell: Tai, what’s your definition of a blockchain?
Tai Zen: My definition of a blockchain is that it is a public accounting ledger that is available to everyone to have a copy of it. Nothing gets recorded into that public accounting ledger until the majority of the users agree upon it.
Mike Casey: You said a public ledger would consortium blockchain into that category like hyper ledger?
Tai Zen: I’ve heard of the hyper ledger. I’ve looked at it briefly but I’m not very familiar with it.
Mike Casey: It’s a permission one.
Michael Tidwell: Hyper ledger is a consortium of projects now.
Tai Zen: For example, if you call R3CEP a public ledger, I would say no because not everyone that agreed to it before was written. Only the company and the people that developed it agreed to it.
Michael Tidwell: So can there be a private blockchain?
Tai Zen: Yes absolutely.
Michael Tidwell: OK. What’s one example?
Tai Zen: The one that IBM is building right now.
Michael Tidwell: Which is?
Tai Zen: I don’t know what the name of it. I read it briefly where IBM is working on a private ledger.
Michael Tidwell: I think the one you’re talking about is Fabric. Unlike blockchain pieces, what they are using is 5:30, which is a message broker.
What characteristics define a blockchain for you?
Tai Zen: The main characteristic that defines a blockchain is how the whole network come to a consensus. Consensus simply means an agreement to what gets recorded into that public ledger.
Basically, it is the agreement process or the technology that’s used so that everyone can agree on what is recorded into the ledger.
Leon Fu: I think another point is it is between parties who don’t trust each other. The trustlessness is the key.
You could have a private blockchain, let’s say, between the four of us and I don’t trust you.
Mike Casey: But you trust the whole of the group
Leon Fu: but I trust the majority of the group.
Tai Zen: What Leon brings up is a very important point. The technology that’s being used inside that public ledger that allows everyone to come to a majority agreement to what gets recorded in there needs to be based on math, or cryptography or something that is outside of a human being.
The reason is as long as you involve trusting a human being, it requires you to trust that human being.
Furthermore, the thing that’s unique about Bitcoin is the technology called proof of work that allows the majority of the users to come to an agreement of what gets recorded into the public the bitcoin public ledger is based on math.
Michael Tidwell: So the immutability is one of the properties of the blockchain?
Tai Zen: Absolutely because if you can go in there and modify what’s already recorded in there, then what’s the point.
Leon Fu: The reason a lot of people are saying private blockchain aren’t necessary is they’re among people who they can’t trust. In other words, if we all trust each other, there’s no need for proof of work.
We could just say I’ll give all of us right access to SQL database. We can do the same thing.
Michael Tidwell: That is how most companies do, right?
Leon Fu: That how most companies do. You’re authorized and I’ll give you permission to do that.
Michael Tidwell: Everyone has the root account.
Leon Fu: Exactly.
Michael Tidwell: He changes the topic, but we can keep going on.
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