>> Live from Toronto, Canada, it's theCUBE, covering Global Cloud and Block Chain Summit 2018. Brought to you by theCUBE. >> Hello everyone, welcome back to theCUBE live coverage in Toronto for the Block Chain-Cloud Convergence Show. This is the Global Cloud Block Chain Summit part of the Futurist Event that's going on the next two days after this. Our next guest is Kesem Frank, AION co-founder and CEO of MavenNet. Doing a lot of work in the enterprise and also block chain space around the infrastructure, making it really interoperable. Of course, Jenna Pilgrim, co-founder and COO of a new opportunity called Network Effects. Welcome to the cube, thanks for joining us. >> Thanks, thanks for having us. >> Thanks, John. >> You guys were just on a panel, The Real World Applications of Block Chain. IBM was on it, which, been doing a lot of work there. This is real world, low hanging fruit, block chain, everyone's pretty excited about. A lot of people get it, and some don't. Some are learning. So you've got the believers, the I want to believe, and then the nonbelievers. Let's talk about the I want to believe and the believers in block chain. Some real world applications going on. As it's evolving, so there's evolution of the standards, technology, but people are putting it to use. What's going on in the sector around some of the real world cases you guys talked about? >> I think we're seeing a lot of collaboration as far as real world applications go, because I think people are sort of starting to understand that if a distributed network is going to work or is going to be secure, it needs diversity and it needs mass scale. If lots of different parties can work together, then they can actually form a community that's really working. As far as real world applications, there's some really interesting one as far as supply chain. Kathryn Harrison at IBM talked about their pilot about shipping, bringing together the global supply chain of distribution. There's a bunch of interesting ones about food providence and bringing together different parties just to make sure that people know what they're eating and that they are able to keep themselves safe, so I think those are two definitely interesting ones. >> Kesem, block chain, supply chain, value chains, these are kind of key words that mean something together. >> Right. >> Making things work in a new way, making things more efficient, seems to be a trend. You're kind of in that world. Is it efficient? (laughing) How's the tech working? What are some of the core threshold issues that people have to get over? >> So you know, John, that's exactly the question to ask. A lot of folks out there are looking at block chain and the promise it represents, and the one big question that keeps echoing over and over is when is this going mainstream? When are we going to see something, a domain, a use case, that is actually natively on a block chain? I think that, essentially, we kind of owe it to ourselves and to everyone that cares about this stuff to ask what's working today, August 2018 and what is still kind of pending? I co-founded a project called AION. For us, interoperability is really one of the key facets that you need to be able to solve for to make block chains real. And again, here's the 60 second argument. If you're going to grow all these solutions that are centric around the use case, they solve for different pinpoints and different stakeholders care about them. They don't really create the cohesive kind of ecosystem until they can all talk to each other, and then you have to ask yourself is the original hypothesis where it's going to be one main net, one chain that's going to rule them all, and everybody gets to play on it and everybody deploys their Dapps on stuff like Fabric or R3 or Ethereum, or whatever it might be. That is absolutely not the way we're seeing enterprise actually shaping into this domain of block chain. What we're seeing is big consortiums that already have value, tangible today, out of doing stuff on chain, and the biggest thing to solve is how do I take, to Jenna's point around supply chain or food providence, whatever it is, how do I actually open it so I can now start writing insurance events, payment events, banking, underwriting, auditing, regulation? There's this gigantic ecosystem that needs to be enabled, and again we are actively saying it's not going to be by an organic model where you and I do everything on top of a single solution. There will be a multitude of solutions, and what we need to solve for is how do we convert them from disparate islands that don't talk to each other into a cohesive ecosystem? >> This is a great point. We were talking on our intro, and we talked last night on our panel, about standards. If you look at all the major inflection points where wealth was created and value was created around innovation and entrepreneurship and industry inflection points, there's always some sort of standard thing that happened. >> Right. >> Whether it's the OSI model during the early days of the internet to certain protocols that made things happen with the internet. Here, it's interesting because if you have one chain and rule the world, it's got to be up and running. >> Yeah. >> It's not. There's no one thing yet, so I see that trend the cloud has, private cloud, public cloud, but public cloud was first but people had data centers. >> Right. >> Both not compatible, now the trend is multi-cloud. You can almost connect the dots of saying multi-chain >> Right. >> Might be a big trend. >> Right. >> This is kind of what you're teasing out here. >> That's exactly what we're about, and I think it's very interesting, the point you're making about dissimilarities between the two domains. We are in a cloud convention, and to me it means two things. One, we absolutely see the mainstream people, the mainstream players in industry, starting to take this seriously. It used to be a completely disparate world where you guys are a bunch of crazies with your Bitcoin and ether and what not. They're definitely taking this seriously now. The second thing, when you think of cloud as a model, how cloud evolved, we used to have these conversations around are you crazy, you're telling me that my data is not going to be on premise? >> It's not secure, now it's the most secure. >> Oh my God! It's in the cloud, what's a cloud? (laughing) You think of the progression model that was applicable back then, right? 10 years, 15 years back, where we started privately and we tell them OK, we'll take this side step of hybrid and then fully public. Took them a while, took them almost 20 years to get their heads around it. >> There's no one trajectory. What's interesting about block chain and crypto with token economics, there's no one trend you can map an analog to, you can't say this is going to be like this trend of the past. It's almost developing it's own kind of trajectory. A lot of organic community involvement. Different tech involvement. >> Totally. >> Different engineering mindsets coming together. You're seeing an engineering-led culture big time going on. That's propelling it up to the conversations of let's lay down the pipes, let's start running apps, but I'll do it within a two year window (laughing). >> I think the big thing to understand about that is yes, you need a whole host of developer talent to build distributed systems, but at the end of the day those systems still have to be used by people. They still have to be used by society, you still have to understand how to talk to your chief executives about what's happening within your company or what your tech teams are doing. There's a growing need for marketers, for PR people, for people who speak, I don't want to say plain English, but people who understand how-- >> Translate it to the real world. >> Yeah, they need to translate it, and how to bridge the gap between legacy systems and how do you take what you were doing before and transform it to a distributed ledger system? How do you do that without just paving the cow path? >> It's interesting, it's almost intoxicating, 'cause you got two elements that get people excited. You got the token economics, which gets people to go, "Whoa," the economics and the liquidity of money and/or value creation capture equations completely changing some of the business model stuff, which could be translated to software and Dapps and software general stuff or SaaS, et cetera. Then you got the plumbing or the networking side of it where things like latency, interoperability, absolutely matter, so with all that going on in real time, it's kind of happening at 30,000 feet and trying to change the airplane engine out. People are failing, and so there's some false promises, there's also false hopes that have not been achieved, so this clouds up the real big picture which is this is an innovative environment. We're seeing that trend. But when you get to the end of the day, what are people working on, to me, is the tell sign. Kesem, what's your project, talk about AION and the work you're doing, specifically give some examples of some of the things that you're doing in the trenches. >> Sure. >> What are you trying to solve, what are some examples you're running into and how does that relate to how things might evolve going forward? >> Sure, so there is a multitude of different problems that we work on but if you want to stick just to the fundamentals? Let's take one gigantic issue that everyone's kind of tackling from different perspectives, let's talk about scale. Scale is, especially in block chains especially challenging just because of how the technology works. How decentralized can you get before you're faced with gigantic latencies and before transaction cost are kind of through the roof? When you think about it, that is all a result of how we kind of contemplate these early stage networks. It was always the one network that is going to scale to infinity. Absolutely not the way it's going to work out. So from my perspective, again, sticking to this one issue, if you could actually give me a decentralized rail that maintains consensus throughout two networks, I can now actually have two trusted kind of go-tos instead of always putting the full brunt of the throughput on one single network. For us, that's kind of a no brainer application to interoperability. If you could actually give me all these trusted networks that work in tandem, I could now start splicing throughputs across many different parallel kind of rails. Not to similar than how we can solve for super computing. We understood there is a limit on how fast can a single CPU go and we started going wide. >> That's an interesting point, I want to just double click on that for a second because if you think about it, why would I have multiple rails and multiple systems? Maybe the use cases are different for them. >> Correct. >> You don't want to have to pick one cloud or one chain to rule them all because it's not optimized. We saw that with monolithic systems and cloud is all about levels of granularity and micro service and micro everything, right? >> Correct. >> And I would also say that gets into a security issue as well, right? You're talking about multiple layers but you also will have multiple layers of permission. You'll have multiple layers of how much information someone can see and what I think is emerging, if data is the new oil, then what's emerging is for the first time we're now able to trust data that we do not own. For corporations who say, "I don't know to market to you "if I don't know everything about you." But at the end of the day, they want to be able to leverage your data but they don't need to secure it and I think that cybersecurity issue is a huge, huge thing that's definitely coming. >> I want to get both of your thoughts on this, because we were talking about this last night. We were riffing on the notion that with cloud compute and data really drove scale. So Amazon is a great example and their value now is things like Kinesis and Aurora, some of their fastest growing services. You got SageMaker, probably will be announced at re:Invent coming up as the fastest growing service, right now it's Aurora. All data concepts. So the dataization really made cloud, great. >> True. >> Okay what's the analog for crypto and block chain? Tokenization is an interesting concept. There's almost an extension of cloud where you're saying, hey, with tokenization, the tokenization phase, how do you explain that to a common person? You say, is token going to be the token and the money aspect of and the economics the killer app? How's it transverse the infrastructures, plural? >> Yeah, or is the wallet going to be the browser? Or how are all of these things happening? >> How do you make sense of this? What's your reaction to that trend? >> So I actually get excited when I think about what token, on the most profound level, actually means. When you kind of think of where value happens in the context of these gigantic enterprises, right? You think of Apple, Amazon, Google, Facebook, any of them, and you kind of think of what the product is, it's all about the data and it's all about how do you convince people to give up data so they can monetize on it. And then you have two distinct, like literally gigantic groups of stakeholders at play. You have the users, that essentially get something free, right? I get to post on Facebook or I get to write an e-mail on Gmail. Then you have the stakeholders that actually extract all that value from my activities. A token, I think most profoundly represents, how do we actually get to a unified group where the user himself is the stakeholder that gets to extract the data? And again, the proposition is pretty straightforward. The more you use a network and the more the network becomes valuable and grows, the more value the token that drives at it. >> So it changes the value capture equation? >> Correct, different model altogether. >> The value creators get to capture the value and obviously network effects plays a big part in this? >> Yes. >> Which is your wheelhouse. (laughing) >> Yeah, definitely. I think it really comes down to core principles. Now you're able to really get down, to what Kesem was talking about, about when you're designing a token or if you're designing an incentive mechanism, you're really going down to the sort of deep game theory of why people do specific things and if we can financially incentivize people to do good rather than punish them or fine them for doing bad then we can actually create value for everyone. We're designing a new economy that now has the ability to propel itself in a fair and prosperous way, if done correctly, obviously that's the disclaimer afterwards, but. >> I love what you're saying there because if you look at collective intelligence a lot of the AI concepts came around from collective intelligence, predictive analytics, prescriptive analytics all came around using data to create value. I always talk about fake news because we have a cloud of media business that's kind of tokenized now but fake news it two things, it's payload, fake news, the fake content and then the infrastructure dynamics that they arbitraged, with network effects. They targeted specific people, fake payload, but the distribution was a network effect. Again, this was the perverse incentive that no one was monitoring, there was no- >> Well and I think in that case, yes there is news that is inherently false information but then there's also a whole spectrum of trueness, if you want to call it that so now we have this technology that allows us to overlay on top of that and say, "Well what is the providence of my information?" And with different layers of block chain systems you're actually able to prove the providence of your information without exposing the user's privacy and without exposing the whole supply chain of the media because there's like media buyers, go through all kinds of hands. >> And we believe the answer to fake news, frankly, is data access, collective intelligence and something like a block chain where you have incentive systems to filter out the fake news. >> Totally. >> Exactly. >> Reputation systems, these things are not new concepts. >> It's all about stake at the end of the day, right? It's how do you keep a stakeholder accountable for their action? You need backing so I think we're definitely on the same page. >> I love, I could talk about fake news all day because we think we can solve that with our CUBEcoin token coming out soon. I want to shift gears and talk about some of the examples we've seen with cloud. >> Sure. >> And try to map that to some navigation for people in how to get through the block chain token world. One of the key things about the cloud was something they called shadow IT. Shadow IT was people who said, hey, you know what? I could just put my credit card down and move this non core thing out in this cloud and prove to my boss, show them, not pitch 'em on the Power Point deck, to say look it, I just did this for that cost in this timeframe, and that started around 2009/2010 timeframe, the early digerati or the clouderati kind of did that but around 2012 it became, wow, this shadow IT is actually R and D practice. >> Mm-hmm. >> Right. >> You started to see that now, so the question that we see for people evaluating in the enterprise is how do you judge what's a good project? Certainly people are kicking the tires and doing a little bit, I won't call it shadow IT, but they're taking on some projects as you were talking about on the panel. How should they, the enterprises in general, the large companies, start thinking about how to enable a shadow IT-like dynamic and how should they evaluate the kind of projects? I think that's an area people just don't know what to look for. Your thoughts? >> I want to add a premise to that, because I think that's absolutely the right question to ask. We also need to add the why. Why should we, as people that do native crypto currency, even care about enterprises? A lot of people kind of theorized when Bitcoin was created to say it was anti institutional is an understatement, right? Aren't we meant to kill enterprise? The thing is, I don't think it's going to be a big bang. I don't think it's going be we wake up and nobody's using banking anymore or nobody's using the traditional healthcare or government and you know whatever insurance policies. We care about block chain in the context of enterprise because we think block chain is a fundamentally better model of doing things. It kind of does away with the black box where I need to be in business, I need to blindly trust you and it introduces a much more transparent and democratic model of doing things. We absolutely want to introduce and make block chain mainstream because that's important for us. When you think of how we do it, to your question, AION is all about interoperability, right? We create a solution that helps scale and helps different networks, decentralized networks, communicate to each other. What we also do with MavenNet, the company I run, is essentially make that enterprise friendly. It's extremely hard to do adoption and implementation within an enterprise, they're very immune to change. >> Antibodies as they say. >> Oh. >> The antibodies to innovation, they kill innovation. >> Totally, so going back to your original question, it all starts with a P and L. If somebody is going to authorize, you know, an actual production system in enterprise for block chain, it needs to create a tangible value, a tangible return, quickly and that's the key. The model that actually scales is you start by flushing out inefficiency plate. You show the enterprise how you could actually achieve, I don't know 20%/30%, that's the order of magnitude that they care about, efficiency by moving some part of your value chain on top of a block chain. >> It has to have an order of magnitude difference or so. I mean cloud was a great example, too, it changes the operating model. >> Yeah. >> They achieve what they wanted to achieve faster and more efficiently and operated it differently. >> Correct. >> And people were starting at it like a three headed monster like what is this thing, right? The cloud thing. And throwing all kinds of fud out there, but ultimately at the end of the day, it's a new operating model for the same thing that they're trying to do with the old stuff. >> Mm-hmm. >> I mean, it's almost that simple. >> Yeah, I think in some cases you need to really, in my previous life at the Block Chain Research Institute, we encouraged a lot of our clients to really take a step back and say, well will I actually, A, will I have this problem in eight years or seven years or 20 years or 50 years, if we're really fundamentally building a new financial system or a new way of doing things that is fundamentally different? Are we building it on old technology? We need to make sure that, and that's why you've seen banks were the first in the door to say, "Yeah, payments, that sounds great, that sounds great." But the real applications that we're seeing from banks are in loyalty, they're in AMLKYC, they're in the sort of fringe operations. Something like payments is going to take a really long time to push through because of those legacy systems because payments is the fundamentals of what banks do. >> This is an interesting point, I want to get your thoughts to end the segment because I think one of the things that we've certainly seen with cloud that over the generational shifts that have happened, the timeframe for innovation is getting shorter and shorter, so timeframe is critical so if the communities are fumbling around hitting that time to value, it seems to be trending to faster and we don't want to hear slower because these systems are inadequate, they're antiquated. >> Mm-hmm. >> These are the systems that are disrupted so the timing of, whether it's standards, or interoperability or business models, operating models, they got to be faster. >> Yeah. >> That's the table stakes. >> I think it all comes down to collaborative governance. >> People have to figure out block chain faster. >> Yeah. >> What's holding us back? Or what's accelerating us? What's the key for the community at large from the engineering community and the business community to make it go faster? Your thoughts? >> Right, so I think we're still searching for the next killer app. If Bitcoin is the reason we're all sitting here today and I profoundly believe that. >> Yeah. >> What is the next thing that drives change on a global scale? That's kind of what we're trying, collectively as an industry, to figure out. Sure, many kind of roadblocks on the way. Some of them educational, perceptional, regulation, technology, but the next big wave that's going to accelerate us to the next ten years of block chain is that next killer app. Organizations such as myself, Jenna, that's our day job, we wake up and that's what we do. >> I mean I've always said, and Dr. Wong, who's the founder of Alibaba Cloud agreed with me, I've been saying that the TCPIP protocol, that standard really enabled a lot of interoperability and created lots of diverse value up the stacks of the OSI model, Open Systems Interconnect, seven layer model, actually never got standardized. It's kind of stopped at TCPIP and that was good, everyone snapped at the line, that created massive value. >> But that's a collaborative governance thing. That's people coming together and saying that these are the standards that we wish to adhere to. >> We need the moment right now. >> Yeah, so you see organizations like the Enterprise Ethereum Alliance coming out with a prospective list of standards that they think the community should adhere here. You know you have the ERC20 standard, you have all these different organizations, the World Economic Forum is playing a role in that and the UN is playing a role, especially when it comes to identity and those kind of really big, societal issues but I think that it comes down to that everyone plays a role that I'm doing my best, I think it's going to be somewhere in the realm of data so that's where I've chosen to sort of make my course. >> I think this is a good conversation to have, and I think we could continue it. I mean, I read on Medium, everyone's reading these fat protocols, thin protocols but at the end of the day what does that matter if there's no like scale? >> Yeah. >> You can have all the fat protocols you want, more of a land grab I would say but there's certainly models but is that subordinate or is that the cart before the horse? This is the conversation I think is in the hallways. >> Totally agree, totally agreed. >> Guys, thanks so much for coming on theCUBE, really appreciate it. Breaking down real world applications of block chain we're at the Global Cloud and Block Chain Summit. It's an inaugural event and think it's going to be the kind of format we're going to see more of, cloud and block chain coming together. Collision course or is it going to come in nicely and land together and work together? We'll see, of course theCUBE's covering it. Thanks for watching. Stay with us for more all day coverage. Part of the Futurist Conference coming up the next two days. We're in Toronto, we'll be back with more after this short break. (theCUBE theme music)

(orchestral music) >> Hello there and welcome to this special CUBEConversation. I'm John Furrier, here in theCUBE Studios, in Palo Alto, California. I'm here with special guest, Shawn Douglass, who's the Founder and CEO of Amberdata, Amberdata.io. It's a hot blockchain-based analytics startup kind of taking a different approach. I obviously would like to highlight some of the startups that are doing pretty amazing things. Shawn welcome to this CUBEConversation >> Great, thank you very much for having me here. >> So you have an enterprise background. You're entrepreneur, technical, been a CTO at EMC. You've helped EMC run their venture capital firms over the years. Helped them build it up from scratch. Done a variety of startups. Kind of cloud, kind of like large-scale. Now doing the blockchain startup. That's, I find super interesting. I think you might have more there than you think, but that's my opinion seeing the demo. Folks watching Amberdata.io is the site. Let's talk about that, I mean obviously blockchain, we've been covering pretty heavily recently with theCUBE. We've been covering Bitcoin since 2010 on our blog SiliconANGLE.com But you're seeing a renaissance in software development, with cloud computing, but now you start to see a new wave coming. We've been documenting. We've been calling it, you know, the future of money, the future of work, the future of infrastructure, because what blockchain and decentralized applications are doing is changing the stack a bit. And you've been in, in many, involved in those waves, so you're at the heart of it. So I got to ask you, you know, as an entrepreneur, before we get into what your company does, I want to just get your take on, you know, I mean, you kind of look at this market and say, it's a wide-open space. >> Right. >> As an entrepreneur who's doing a start-up, what's it like? What's your view? And how do you see the marketplace evolving? >> Yeah, that's a great question, there's a lot there. Let me try to unpack that the best that I can. So having gone between startup to big company to investor, helped buy, build, sell, in companies and operating for as long as I have in Silicon Valley. I think, as you said, technology and innovation happen in waves. And I think that waves are mini-revolutions, if you will. And I think that revolutions are about addressing a fundamental human need. If we look at, look to history, to see where the future is going. If you look at the Industrial Revolution, it was about automation and supply, I mean, uh production chains, and to be able to produce things at scale. If you look at the Information Age it was about the ability to communicate, and the servers and the networks and the web 2.0 companies that arose out of that, was around communication. That was another major wave. If you look at what's happening with AI right now, and self-driving cars, that's about the ability, for the need to think, right? And you're starting to see algorithms and machine learning applied to Google self-driving cars, and you know, just about every facet of our life AI is touching, you're using Siri at home, whatever you're using. I think what we're seeing with blockchain is that next wave. It's that next revolution, and that revolution I believe is about trust, and about decentralization. So, coming out of web 2.0 we saw participatory and non-participatory consolidations, in creation of juggernauts of technology. The Facebooks of the world, the Amazons of the world. On the other side, the Equifaxes of the world, where you didn't opt-in, in exchange for being the product, to use their platform, they just got your data. We've seen violation of that trust in data breaches, you know, at every major player, you know. Equifax being the bad guy in this case, where they've lost every single citizen in the United States data, and we never benefited from that, but we carry the liability forward. And what we're seeing with blockchain is the ability for people to leverage decentralized platforms and smart contract platforms, specifically, as mechanisms to easily deploy with zero barrier to entry. These, you know, these smart contract vending machines, if you will, into a world where people are taking back trust. So I, that's what we see, and we see that opportunity across both the enterprise space, 'cause we're hard core enterprise people, that we're building member data, but we're also seeing new enterprises being created on chain and that list is really long. So it's pretty, it's definitely a big wave. >> Well, the one, blockchain's an infrastructure, I think people getting all crazy over that, which I think it's legit. And there's some people out there saying, "Oh, blockchain's not legit." They don't really know what they're talking about in my opinion, and that's just, and a lot of people are confused. So there's a lot of people who are, you know, obviously don't see it, some people do. But I think the phenomenon that's interesting is, you know, taking a tech stack approach is, if you look at the decentralized application market, >> Shawn: Right. >> Where Ethereum for instance has got a lot of, the most developers. And they're working fast on some technical challenges they had but they're making progress. The D applications, the distributed, I mean the decentralized applications, that's like an application server on the blockchain. >> Yeah, exactly. >> So what that happens, is the things are happening, so you almost think of it, and you and I were talking about this, is that, you know, the vending machine of the future or the transaction service layer is that decentralized smart contract. >> Absolutely. >> 'Cause that's where the value is going to be captured. >> Shawn: Absolutely. >> And created and captured. >> Let me unpack that, because that's spot-on, I 100% agree with what you're saying there. Is that, what is a blockchain? A blockchain is effectively a decentralized database and network put together. What I think is interesting, is smart contract platforms that put a virtual machine on top of that. Like Ethereum has the EVM. Where it's your application server. And what are smart contracts? Smart contracts, like you said, are vending machines. They're a vending machine that has the appropriate level of security, the appropriate level of service, and allows you to have an autonomous transaction with that. When you walk up to a Pepsi machine, you put in a dollar, you expect to get back a Pepsi, it works, you go away, you don't think anything about it. What blockchain is allowing anybody to do, is to publish a smart contract on chain and monetize that at the most elemental level. It's analogous to, if Amazon allowed you to deploy a lambda function and monetize that. It's analogous to, if E-Business Suite allowed you to monetize your plugins from an Oracle world. It's analogous to if SAP with, when Shai Agassi was still there doing composable applications, allowed you to, as a vendor, anybody publish into that SAP ecosystem and monetize that. This is a massive, massive transformation and it reduces barriers to entries for people to come in and compete with juggernauts like an Amazon or an Oracle because at the barrier to entry is, they're publishing into a globally available, decentralized, platform, right. >> And the thing too that's interesting, and just to tie that together with what's happening in the cloud world, is if you look at like Kubernetes containers, and micro-services, the ability to be efficient with micro-services, allows for that IT infrastructure to completely be re-platformized. >> Exactly. >> So what you're getting at, is with the smart contracts and the atomic nature of the transaction, you can be laser-focused and scale transactions, >> Right. >> and be efficient, so the efficiency is a big part of this. >> It is, there's efficiency, and there is the ability to decompose things, and that's been a trend, for as long as I've been in technology right. It's, first it was, you know, cloud services, then it was SOA, then it was cloud, and now it's serverless, it's blockchain, it's just on that spectrum. There's not a lot new here actually, right. It's a continuum of technology, and I think all of these waves are enabled by different revolutionary forces. >> Operational change and software drives it obviously And you got the characteristics of blockchain, immutability et cetera, et cetera and DApps is just a new way to kind of write the software for that. They create those vending machines or transactional services So I got to ask you, so with what you guys are doing, I want to tie that together, because one of the things we've been reporting on theCUBE is, the piece of action that's most hyped up is, ICOs. These blockchain apps that are changing, and the old guard and disrupting incumbents. But there's not a lot of tooling around it, so, you know, if you think about like trading platforms, >> Right. 24/7 traders have access to stuff. Now the world's a 24/7, 365 global. There's not a lot of tooling, not a lot stuff. So this instant industry's created. This new wave is coming. You're building some tooling, so I want to get your thoughts on the support needed to do this. >> Shawn: Right. >> Say I put my business on the blockchain >> Shawn: Right. >> And with, use developers to do decentralized applications. >> Yeah, so, >> I need tools. >> Aboslutely, that's exactly, so, you know, got a little gray hair here, and I grew up building internet software at scale, right. Whenever you run anything in production, you always have your network operations center. You have your AppD, you have your Splunks, you have your New Relics, you have all of this. You've instrumented your infrastructure. You've instrumented your application transactions. You've instrumented search for operational log data. You need to be able to triage a security instance. You need to be able to respond to performance or production issues. You need to be able to communicate with your customers. None of this existed when I looked at the blockchain space, and I'm like I don't get it. This is a massive opportunity, because if you look at the enterprise space, 'cause public right now, sure, it's very interesting. ICOs are the killer use case. There's 300 million dollars per hour traversing in the public at their IMNetwork, 50% of those are going to smart contracts. A lot of that is actual transactional trading volume. But step back from the hype for a second, and you look at IBM, you look at VMware, you look at Cisco, you look at Microsoft, you look at, you know, all these guys. JP Morgan with Quorum. You look at, they all have major bets that are starting to evolve around taking things and removing intermediaries, just like public chain, but they're doing it with things like swaps, credit default swaps, interest swaps, currency swaps. They're talking about removing escrow services, they're talking about, >> So pre-existing companies are going to take the efficiency side of this and drive it. >> It's going to, it is a massive transformation right, and especially when they're working with their trading partners, there's almost a, what, a 2006 VMware data center consolidation play. Remember when the data centers were full of servers, and then all of a sudden, you know, they started pulling back the number of servers and turning off the A/C because they were able to take entire data center floors and consolidate them inside of VMs where they had three and four virtual machines in a server. And I think that you're going to get those same types of efficiencies over time once they get to pass some scaling issues around blockchain where you don't have to have seven copies of your data across your front office, your back office, across your trading partner. You can have one single source of truth and operate in an open transparent world where you can reduce some of those inefficiencies. And then there's a whole business transformation play that, you know, there's there's just, I think it's a, >> It's a perfect storm. You have a consolidation piece, which is more efficient operationally, and then you got the top-line revenue opportunity with disrupting kind of industries with new transactional models, business models and token economics. So we've talked a lot about it in theCUBE. I want to talk to you about your company, Amberdata. So you guys are trying to make sense of what's happening because if you're going to put a business on the blockchain, >> You need this. >> and use decentralized applications as a transactional application server if you will, for lack of a better description. You got to know what's going on, and there's gas involved, you got to pay the mining fees, so where there's costs, you need visibility. >> Right. So the old school, the old model was, you'd have KPIs, set some alerts, dashboarding, you're doing that right? >> That's what we've done. >> So take a minute to explain what Amberdata's doing. Did you do a round of funding? What's going on with the company? You got the product up there Amberdata.io >> Right, yeah, so let me unpack, there's a lot there. So uh, we started the company end of August. We raised a round of funding with traditional enterprise venture capital firm Hummer Winblad. Lars Leckie, amazing investor, really understands enterprise software and how to enable companies to grow. Amazing partner to work with. We've been heads down building a product. About 45 days ago we launched our platform live, and what we have today, is we have instrumentation for blockchain infrastructure, decentralized applications, transactions, and an ontology-based search, that gives a clean user experience where you can be search-driven to drill into a smart contract, a transaction, into a block, and you know, if you're building on top of chain, I mean, we're a classic picks and shovels play, It's pure, it's enterprise software, we built this for enterprises. Today our platform supports public Ethereum, but it was really to demonstrate, if we can do this for the entire Ethereum network and we can do this for its scale, of course we can do this for any enterprise. And today we support public Ethereum and Quorum, which is private Ethereum, it's a JPMorgan project, that I think is the one of the leaders in private blockchain, and that's a project that's being supported by the Enterprise Ethereum Alliance. We will also in our working with IBM, I was just on the Hyperledger technical steering committee this morning, I participate in that. So, we will support Hyperledger in the future, we will support multiple other public and private chains so the private ecosystem today is, you know, Enterprise Ethereum à la Quorum. It is Hyperledger. It is Corda. On the public side, it is Ethereum, it is Stellar, it is, you know, things like Quantum that are emerging, Neo, or emerging. >> So is your business model SaaS? Yes, it's a SaaS model and today we support public chain as a demonstration of it, but we're also working on allowing people to, just like a data dog, or what have you, where we have a connector, we can pull your data in, and it's private, it's only visible for you, for your private blockchain. Or we could deploy into their private cloud or into (talking over each other) >> John: So is Amberdata.io like a demo site, or is that more of, >> It's a demonstration of the ability to instrument blockchain infrastructure, applications, transactions, with search, the ability to set alerts on every single panel, which are your KPIs. If you're going to run a business, you either have explicit or implicit service level agreements, and you need to be able to instrument those service level agreements with KPIs, and those KPIs you need to be able to set alerts and events, receive emails, you know, all of those. >> I love the demo, the demo, I think the demo will be a great freemium model, because it showed, just my notes here, smart contracts on the decentralized application, top 50 sorted transaction volume, token velocity change in price, because you know gas you're still paying the gas to get the transaction written. I mean this is kind of like spot pricing for Amazon almost. You need to understand what am I paying for, if there's an SLA involved in a smart contract? >> Absolutely. >> You got to know the policy involved right? So, again, this is like old-school, like enterprise thinking, >> Shawn: Right. >> The world is now a global enterprise if you think about it. >> Shawn: Yeah, you absolutely need transparency into your operating costs. Those are your transactions costs of either, for your customers to consume your service or for you to provide your service. And, prior to this, there was very little transparency. It's ironic, is that, the most trustless, transparent platform, had no real view into it. And that's what we've built. We've built transparency and are enabling you to trust the trustless platform, to get transparency into your DApp KPIs, and so for example, if you're building, like you look at like EtherDelta's, EtherDelta's is one of the non-custodial smart contract based exchanges. They're doing 70 million dollars a month in transaction value. I don't know what they did before. We've talked with people that are consumers of that. We've talked to people on pretty much all of the decentralized exchange platforms. But the ability to understand, what are the number of transactions per hour, per second, per minute, that are hitting my smart contracts? What are the token transfers, if I've tokenized my unit economics. Who are the top 10 callers to my contract? Is my smart contract calling other contracts? What are my pending transactions? What is my book of trades? What is market depth of my gas prices? What, I need to be able to search if I've got failure. Show me transactions between this date, that date, to, from, where, that is all mission-critical stuff that you need if you're going to operate any business. >> So a lot of operational data and that's phenomenal, but are you worried that people aren't going to adopt? Blockchain I mean. >> I'm not worried about that at all. I actually think that there's an entire, when we started this, we were focused on enterprises exclusively, and we saw what we were doing on public Ethereum as a marketing ploy. We're like "Hey we'll go instrument "the whole public Ethereum Network". I'm a big data guy, we've built high-throughput, four terabytes a day of social graph ingestion platforms. We're like, public Ethereum, you know, not that transactionally intensive. We're going to do this for the world. Now, after building the platform and seeing 300 million dollars an hour, with 50% of those transactions going to smart contracts, we're seeing a new Enterprise emerge. You can look at companies like, you know, Sia, Storj coin, IPFS. >> So can actually see the activity (slurred) it's encrypted, but you can look at the metadata and get the patterns. I mean you're essentially looking at the transactional volume, almost like a stock exchange. We can, we have full transparency into every transaction, that's happening on chain, and we can see, like the other day, I did a tweet on, there was a token that's traded, I don't know, we're not interested in the trading side but it's the use case that has the most buzz, and we have transparency, so we see it, we're like, "Hey, this smart contract went "from two thousand transactions, to 40 thousand "transactions. What is going on?" Right, and we actually saw that. >> You can see the pump-and-dump scams too. >> Oh you can totally see that. In providing transparency, is now, it's becoming easy for anybody to search for anything. >> Well that's a great free service, and I appreciate you, and I've been playing with that over the weekend, I love it, I'm like, "Hmm, I might get some trades on this thing." >> Thank you. Check it out. We'd love feedback from anybody that's seeing this, Amberdata.io and I can be reached at Shawn@Amberdata.io >> So, I mean obviously funding you must have a ton of VCs throwing money at you, is that the case? Are you thinking about an ICO? What's the thoughts on the capital expansion? Yes obviously got a great, hot startup here, so what's the funding strategy? >> We've been heads down on building things, and we're obviously getting inbound, but you know, we're well funded, we're in as, I think we're in a position of strength. What we're focused on is taking the mountain, and defining and being the category leader. I think right now, we have defined it. >> There's no one else doing it. >> Yeah, exactly. >> So you're like the solo, you're the only one doing it. >> So, we are going to define the space for operational monitoring analytics for public and private blockchain, and be that single pane of glass that allows enterprises to build on or around, you know, decentralized smart contract platforms, or, you know, private smart contract platforms. And we're going to take that hill, and we're going to stay out in front. So right now, we're heads down. We'll eventually, (talking over each other) >> Can I get an API to the data set? Can you just give me an API? Like a fire hose opportunity there? >> So we are enabling this as a platform, to drive network effects, and we're working with several exchanges, we're working, you know, some of non-custodial exchanges. We've got a lot of inbound interest from people more on the trading side. We're evaluating whether we do that, and we want people to be able to build on top of our platform, other analytics tools, you know, connect to exchanges, connect what have you, right and create that marketplace, create those APIs, inroads, and then allow people to drive that. And on the ICO front, we're really not focused on that. We're enterprise software. >> Well theCUBE team would love to have an API and program with it for theCUBEInsights, we'd love to look at that. >> That would be great right. >> That's something we can work together and collaborate on that. I got to ask you about the data 'cause this is fascinating, coming from the search background that I come from, it's almost like the Google crawler. You went out, >> It's a Google for blockchain. >> Is it true that you guys crawled all the Genesis nodes on Ethereum, so you got into the Genesis nodes? >> Shawn: That's correct. >> So from the Genesis nodes to today, you've essentially gotten all those instrumented, >> Shawn: Right >> And have real time data coming in. >> Yes, that is correct. So as far as I know, we're the only people that have done this. It's computationally intensive and from the data structure perspective pretty difficult to do. But what we've done is, and it has to do with the data structures in the way Ethereum works whether that be public or private, is that there's an account-based blockchain that has transactions, but then the smart contracts and transfers of tokens happen in messages. So what we've done is, we have the ability to, or we have done and we have the ability to do in perpetuity moving forward, we instrument every transaction, every internal transaction, every token transfer, with time series data, indexed, searchable, we also have graph as well as relational views into the data, to be able to give the transparency, enable trust, enable you to triage an issue. Like, you know, I think about having worked at, you know, other enterprises in the past. Where you have a, you know, a security incident, that you need to respond to. We're currently under attack we need to find out who, what are they doing, what have they done, what is our exposure, how do we contain that, how do we, you know, deal with that? Without what we have, you can't do that. You got to like right Python scripts, and do API (talking over each other) >> You're chasing a ghost basically, and by the time you get it, it's over. >> Right, and then for enterprises, they've got hard core regulatory compliance considerations that you need to deal with. Ad-hoc queries from an auditor, you need to be able to show "Hey, I've got confidentiality, I have availability, "I have integrity" >> Well, even these smart contracts are still software. They, and you know, we've interviewed Hartej Sawhney, who's got a company that's doing just that auditing, >> He's killing it right. >> Auditing, the smart contracts because someone's going to write the code, and the code's back vulnerabilities. >> Absolutely. >> So there's a compliance aspect coming, quickly. >> Yes, yes absolutely. Yeah, I mean, so there's, it's an amazing space. There's a tremendous amount going on. It's moving super fast. >> Picks and shovels for the new miners, literally miners. Shawn, great to have you on. Congratulations >> Thank you. >> On your new startup. I think you've got a great product. I've been playing with the data, I love it. I think it's fascinating. If you could summarize the data that you've learned from the tool that you've built and platformed, what's the summary? What if you had to kind of tease it out, what's actually happening right now in the market, on the Ethereum network, with the apps and blockchain? >> Right, so, there is, so at the end of the day, Ethereum is a smart contract platform, and it pans out, that 50% of the transactions are actually going to smart contracts, which is a great validation right. Two: the actual value being transferred and interacting with smart contracts is 300 million dollars an hour. That is, it's, on an enterprise software perspective, it's not huge, but it's definitely a validation. >> It's legit. >> It's legit. The number of smart contracts that have been created in the last three months, is 400%. It is just going through the roof. Some of this, there's a lot of junk, but there's a lot of stuff that are people are building new enterprises, and on the enterprise side, we're seeing real business cases going into production, working with a few large customers now, on instrumenting real, you know, removing, you know, instrumenting real, over-the-counter type use cases. It's very, very interesting times. >> Well, you know my rants. I've been ranting about some of these bankers that have come from an old-school bank, and they're young kids too, so they're not, they're younger than me but they're trying to valuation mechanisms around, you know, companies and tokens, and they're using like discounted cash flow. Now I mean I get how they could go there, 'cause they learn that in school. >> Shawn: Right. But the reality is there's a new school going on. The school's in session. If you know the data, you have very interesting valuation variables that could be constructed on these new models that need to be looked at. I mean, how do you value a company? Certainly velocity. >> Shawn: Yeah, volume. >> Who's actually doing the transactions? Are they real smart contracts? So there's a lot of gamification and, I won't say scams, but I would say the investors want the transparency too. >> Yeah, I think it's amazing is that, we have that transparency, we provide that transparency as free service to the community right now and the ability to have transparency into transaction volume for smart contracts, token velocity, number of unique callers, market capitalization, the change in price, this gives you the ability to value that. That's something that, you know, we've thought about extensively is, maybe we should just provide valuation as a service, on just these assets that are publicly available? Yeah, I don't know. >> You had a lot of opportunities, so great job. Congratulations, good work. You guys have really done the work on this project, love it. And again, it validates the reality of the smart contracts, the application side of the business changing. Shawn Douglass here, inside theCUBE for CUBEConversation here at Palo Alto. I'm John Furrier. Thanks for watching. (orchestral music)