CryptoBasic Podcast

Your source for all Cryptocurrency information, made for the novice investor. 

The way we were honored because she considers as a resource.

Mike:

So thank you, she's. Like, hey, boys, get on that episode. Make it happen quick and well, yes, ma'am, wait.

Karim:

Welcome to the crypt of basic podcast. My name is michael aki. And with today's episode we're going to tackling this one on one with the one and only karim bouquet.

Mike:

How you doing, man?

Karim:

Unfortunately, today we will not be joined by your majesty as he is doing things of great importance that us mere mortals could never comprehend your majesty. One the port for the competition for the month of april and as a result, none other than our pal crypto candeloro. You won the giveaway for the listeners and decided to use her prize to record a special one. Oh, one on a topic of her choice, she chose elastos. And that is what we shall cover for the majority of this up. So but first, please. You don't forget to check out our other episodes from our one o one siri's for a deep dive on a token project or concept from the ground up.

Mike:

You know and it's words saying, by the way, it was kind of interesting because crystal can has been on the show. So, you know, i'm being, ah, fellow content creator. When we brent drew our name, it almost fell rigged, right? Like anybody would look at that. So i just going to mention that ah, brent, always being mindful of things like that did take decentralized, transparent approach, so that drawing was done on a randomizer on the internet, where people can jake the results. But, of course, crypto candor. One. She runs good, and she picked a really interesting project. So i guess i'm glad brent one a month.

Karim:

Yeah, this looks pretty interesting, and i'm looking forward to this conversation, so let's get started. What elastos is, what is the vision that they're trying to accomplish so?

Mike:

It's very interesting. You know, when we get into the history, i'm going to show that elastos has roots that go a little bit deeper before botching. But you could say that elastos is trying to create a new type of internet that will be powered by blockchain, but that has higher safety standards. It also wants to create an operating system that essentially will be a virtual machine. So i wants to achieve that goal of a better internet through the virtual machine itself, and elastos also wants to create a way for digital assets to be scarce, identifiable and tradable that when we're talking about content creation, media videos, music, things of that nature and there's, a lot of focus on being able to run and operate decentralized apse on mobile like its something that's mentioned a lot in the white paper and in the community. The fact that this is something that shouldn't just being on a computer that you know, mobile phones are so prevalent today that they want to integrate seamlessly with that.

Karim:

I like that a lot. And i think that this is a really interesting tilt versus other projects that are trying to accomplish different types of what the internet currently is. And i think that it's a really interesting idea that they want to focus on the mobile side of it. Because, let's, be honest, like pear, the mobile phone, global acceptance and adoption now versus ten years ago. This is huge, and i know. But prior to recording this podcast, i didn't even own a computer for about a five year stretch, because smart phones and ipads and things replaced all of my needs for that. At this point, now that, you know, we create some audio content. I've, you know, gotta computer again, really interested in what this, how this all plays out.

Mike:

Yeah, you know, now that you mentioned that about mobile phones there, not just exploding and, you know, obviously in the us and almost everybody has a smartphone, but his new generations come on. Smartphones are really spreading all over the world, you know, they're not really that expensive anymore in a lot of developing countries. So yeah, there's, no question the mobile network is larger it's going, but i mean he's becoming rapidly larger than anything else, but also this is going to run on pc. The idea is for ah, elastos two people to run on anything i don't want to make it seem like it's, an exclusively mobile thing, but they do emphasize that point that they're going to be able to operate and give the user and experience on their mobile device.

Karim:

You have a quote written down here, and as i read it, i like it a lot. I think you should share it if you if you were considering not sharing it.

Mike:

Yeah sure so this quote comes from one of the interviews with wrong chen the creator and actually drew a couple of things from there because you know it's always i really always like getting the creator's perspective because that's let's say ah the original source right so when he's describing thie smart internet or the smart web because sometimes that's hard to conceptualize like what what does that even mean and he's talking about being able to attribute i ds to websites so he says there's no i d on today's internet anyone kept out of server as a note on the internet and that's why it's developed so fast there's no approval system but it also creates a siri's of big problems such as viruses forge identity and theft of user privacy it's all because there's no id now we are more inclined to use big applications such as we chat and google so we're creating an oligopoly of companies such as tense and google microsoft and so on that issue i d for us because it's safer so he's basically saying look at all the power now that these companies have because we need some form of i d issuance you know whether it's a screen name or une mail address or whatever so elastos is trying to come in and provide a decentralized solution for that too cavin idea associated to users not necessarily an idea where you know their first and last name but an idea. That's. Constant, like a screening, but to be able to do it in a decentralized way.

Karim:

So what i'm hearing, you say, initially, seems to create a couple problems as well as solve a couple problems. The one thing that i just like to play devil's advocate here, you know that we're big fans in it. So the first thing that came to mind is, at first i thought you were you were suggesting that the actual websites themselves would have more of an idea that the actual servers that make up the internet would have more of an idea. But as i was hearing you, like elaborate a little further, it sounded more like the user end. So the first thing that kind of came to mind isn't the beauty of the internet to be able to open doors that you don't necessarily feel comfortable opening in other areas. I feel like this is what makes the internet so important.

Mike:

No, actually your first instinct was correct, mike and i might have actually office skated the original quote you can create a the equivalent of a wallet which allows you to remain anonymous you don't have to attach your personal id to anything, but once you start doing more advanced actions in the network, such as hosting a website creating a domain than that is great, that is what you would have an idea attached to it. So it is more about the website itself having an idea or a domain or something attached to it.

Karim:

Yeah, i like that a lot better and the main reason why is that one of my pet peeves when it comes to the internet is that it allows people to share extremist ideas with other extremists and also gives them a platform to act upon those ideas, and i think that i don't want to zoom in on a particular conversation involving that, but i would much prefer that the hosts the platforms that these people are going to gather on i think that they should have responsibility for the type of content that they shared, and i think that that's a kind of an interesting twist at the same time it's going to be hard for this to be globally adopted as described but there's a lot more for us to discuss on this topic so let's move on to the history right so the history of elastos as i hinted to earlier goes before blocking so the creator the design originally comes from a gentleman named wrong chen so he used to be a senior software engineer at microsoft and he actually worked with microsoft in the development of the windows operating system he was part of the teams that were analyzing different options and if i understood some of his interviews correctly they were basically breaking windows operating system into three different categories and develop them independently one of them would go on to become vista another one would go on to become windows ten but he had a very specific vision of what he wanted the operating system to be specifically he wanted to create a way in which special when you look at the internet applications that it shouldn't directly connect to the internet like he wanted something that protected the computer itself let's say from you know, just any application being ableto access directly through the internet but anyway in the year two thousand he he moved back to china and started working on his own development company where he was working on elastos is an operating system that had nothing to do with blockchain they've got a lot of funding a lot of institutional backing which we're going to get into more with this project that's actually one of the things that i like this that there's a lot of big players, a lot of serious players that are engaging with them in a professional way in terms of partnerships and things like that so i take this project seriously but anyway we're ready to launch their mobile operating system around two thousand seven but as he tells it that's around the time that android and o s were also launched so it was not good timing to go against those two giants yeah that's an excellent point and you know, i just happened to have volunteered the fact that i went five years without a computer yeah like that was probably a pretty bad timing in the market for you know the quote unquote stock of personal computers so what i find interesting about this could you imagine what it would be like to just sit with twenty people in a room that we're former senior software engineers at microsoft and just like who knows what kind of stories they have, what kind of visions they had they weren't able accomplish like how much of the brainstorming at a company like microsoft went on you i feel like it has to be a ton of great ideas that just like they didn't have the funding to make it work or it just didn't make enough sense of the time that you know over time could develop in the great projects i'm really excited to see what these types of people are going to be able to accomplish over the next couple decades yeah mike that's a great point because ultimately that is also a feeling that i got right like he was in microsoft he had a particular vision one to take the project a particular way but there's only so many directions that you can go right like ultimately decisions have to be made options have to be weighed trade house have to be made as we always say but it's cool now to see this side chain that originated out of those brainstorms that originated out of those individuals and you know it's becoming its own thing now in twenty seventeen the blockchain started become incorporated because one of things that wrong chang said that was always missing is you know he wanted to create this operating system as i said specifically he wanted to make sure that it was a platform where the the applications and services were not allowed to access the internet directly because that's how you send viruses and attacks and that's how you spy on people but basically they hadn't figured out the problem off like what's going to take its place what's going to be the middleman right like how are we going to run everything connected who's going to host a computer all of the things that now the distributed ledger system the blockchain type systems can help the project starts seeing potential solutions so i just think it's important to know when we're talking about the history basically elastos is a long development project for an operating system that has now recently incorporate inflection technology to go an extra level.

Mike:

So a couple things stand out to me as pros here.

Karim:

I like the fact that this is something that this man has been passionate about for a long time.

Mike:

I like the fact he's qualified to speak on the topic.

Karim:

I have a question for you, though real quick. What was your introduction to the personal computer like in your lifetime? What was it like for you?

Mike:

Well, my first introduction, really to computers was as a kid, my dad used to buy me like educational video games, so i remember, like i don't remember exactly what they were called, but, you know, like games where you're doing math problems or they're associated with history or something like that, and there were also like the lion king s o mostly pc games. We had a personal computer, and now i must have been seven or eight years old when i started using it.

Karim:

So what i found interesting in my initial the introduction of personal computer, i want to say that i was about i mean, i definitely used one at school when i was younger, but when my family first purchased one, i want to say that i was in my early teens maybe eleven or twelve, and when you use the computers back then the internet reminded me a lot of what using blockchain is like currently there was a lot of viruses that would go around was very easy to click on something stupid and just like suddenly, your computer could just be, like dead, and it was like, beyond repair. It was insane. So when i think back to that time and then i compare it to where we are currently with crypto currency, i see a lot of parallels. So i like the fact that something that was a major importance back then actually has a lot of major importance now, because it's so not user friendly, i think that this is a gold mine for, you know, attacks and hacks and theft and all these types of things, so focusing his efforts from that time frame, i think it has a great application here, and i'm pretty interested to see how this all plays up, absolutely.

Mike:

And i do think it shows that his vision wass how don't want to say this is not so much about his vision being correct because i don't want to make any claims that are that, you know, specific, but i think that it shows that he identified a problem that was a very real problem, and he is attempting to provide a solution that at least has plausibility around that it's a solution that makes sense, but this problem of the fact that anybody can get on the internet that thie connection from computer to computer is used to send trojans to attack the hack to spy on that is still an ongoing problem, which many companies have gotten better at right? So for example, using google chrome today or fire fox it's a much safer experience to using a browser off, you know, eight or ten generations ago, i'm talking about browser generations, obviously, but at the same time, all of this is still centralized so much in the way that he was talking about, we are relying on the companies a lot of times we're relying on cos in their browser and their software to protect us from viruses, so this is a way to how do we connect computers everybody's connected to everybody decentralized, but also we are protecting the user, and we're not just opening up your computer to the internet all right, i was low of our conversations on the history of a project.

Karim:

We always like to go down and some interesting conversations. But let's, go ahead and move it onto the features and structures. What he got for a scream.

Mike:

Okay, so they start their white paper by talking about how most of today's smart contracts are designed to run on the blocking exclusively right but elastos wants to run decentralized applications that are enabled by the blockchain but they're not actually running on the block chain so they look at a project like ethereum and they say yeah okay theory omise good for consensus based recordkeeping but it lacks computational speed and flexibility so elastos a solution to this and i think this is similar to something like cardano is to create a central block chain which has very limited transactions on it you're not burning the main blocking with smart contract logic or anything like that and then you have side chains that operate interact with the main block came but don't boggle down the block chain itself so when we're looking at elastos and their main proposition of the smart web you could break it down into four pillars right? The first one is de elastos blockchain itself like we just talked about that's the actual decentralized where the wallets are, where websites would be stores and where would have digital assets and you know like the main core area the blockchain part of it, so to speak. But then you have elastos run time and elastos wrong time is sort of the m v p here and this is essentially the virtual machine that you would be installing on a device that remember mike i told you that this could run on mobile but it could also run a pc but it could run basically wherever so this is exactly how it works you basically take elastos runtime and install it on a pc or mobile and then that is essentially a virtual machine that runs inside of your computer so all of the aps and all of the decentralized applications that are going to be developed for it are running within this virtual machine that doesn't let it escape that little you could call it an app sandbox if that makes sense so everything within the sandbox can happen but it can't exit that virtual machine that is being run so doesn't have access to the computer itself and that virtual machine is essentially being destroyed when you turn off to software so that is essentially the way that they are creating that separation that safe operating system that is running as a virtual machine on existing hardware or on existence something like windows or andrew ward or apple so here's a quote again from the creator that puts it into some context at this stage to research and development of the new generation is not the operating system on a physical machine instead it is making a virtual machine in the so called cloud computing cloud computing is also known as elastic computing computer refers to the hardware computer and computing is about the operation of the program that was pretty interesting, and i like that the idea that they're trying to solve is fairly unique, and the approach that they're taking is also fairly unique, and what stands out to me the most is the idea of the sandbox you referring to because when i use, you know, my phone, for example, a lot of the apse interact with each other, they interact outside of the program itself, you know, i know that i use apple and use android, so, you know, my reference started this, so i'm going to make sense.

Karim:

I'm sure you have some version of this yourself, but it tells me, you know, i have a list of things that are running in the background, and i gotta, like, manually turn them off for certain aps elastos yohei, can this run and track your location like a uh, i'd rather not, but some things are useful, so i like to this tries to keep everything kind of where it belongs. And i think that's where a lot of our privacy issues just kind of came from was just the fact that these aps are accessing this data, that we're not really aware that their access that's right and that's exactly the point that when you are just opening the computer up to the internet and the applications the way that they can interact with your personal data is very intrusive and also the way that, you know, like we just discussed the way viruses can be exchanged the way trojans, the way you can spy on people, and the other interesting thing that this accomplishes is that now you are really separating the system that runs the application from the blockchain itself.

Mike:

The reason this becomes interesting is because it very likely deals with all the issues that you see let's say, for example, crypto kitty's, right? One of the problems with crypto kitties is that it's literally trying to operate on the block chain so it's limited by the creation of new blocks and the actually theory in transactions in order to just half standard operation, which is why i can get so easily overloaded. On the other hand, let's say that crypto kitty was built on something like this. There might be certain elements of the crypto katie application that is communicating with the blockchain itself but it's running on your computer just like any after you download or just like when you download an app on your phone it's running on your phone, you know what i'm saying? It doesn't need to run everything on the block's right so let's take a step back and let's look at this from a helicopter view so essentially what it sounds like they're trying to do is have their own verifications on side chains and once there khun b probably much larger verification is on a side chain and all of those verifications will then be sent on to a more cliff note type main block chain that so the side tubes they're going to basically answer to the main chain and it's going to basically allow for a lot more transactions toe happen because the main chain isn't nearly as clogged up is it could be potentially is that what i understand yeah that that is exactly it all of these new applications that are created on top of this can create their own side chain with whatever requirements are needed for that space steem project and they will have a way to communicate with the central block chain which will still allow for the you know the bass creation like the baseline a layer of the smart economy the base layer where assets are transferred everything exists on top of this but not everything is putting all of its data and all of its transactions and all of its logic and all of its smart contracts on the blocking right it's exactly as you said yeah it's very interesting i mean should see how that plays out what other features do they have?

Karim:

Yeah so you know, continuing on the four pillars we mentioned the blockchain itself then the elastos run time which is essentially this virtual machine that you have something called the elastos carrier which takes over all of the network traffic between the virtual machines and conveys information on the applications behalf so you know as we were talking about limiting how much right the applications have the application communicates with the virtual machine and then you have a standardized part of the protocol thing called elastos carrier where have won no needs to communicate with another node it's going to transfer the information through there which again makes it so that you can't just create your own information that you can pack in viruses or whatever kind of nefarious thing you want to put into that data packet is essentially taken out of the hands you're not directly communicating with every note through your app you are using elastos carrier as an in between and then the last pillar is the elastos software development kit and that's basically this is how also how'd they differentiate themselves as an operating system you know they're saying we're not braking system we come with software development kid like windows comes with the software development kid or iphone comes with the software development kid in the same thing goes for android right?

Mike:

If you're going tohave an operating system, then you need to give developers to tools that they need in order to build on top of it.

Karim:

So that's, where the comes in, right?

Mike:

Yeah, so let's plow through, and i guess going to some of the the specific features or use cases, or all the little details that i could find her.

Karim:

What you got interesting.

Mike:

All right, so one of the things that we mentioned is the public chain itself, right? Is going to stay simple and a lot of the information. There's, all encrypted and hidden from the third party, abs and services. They're communicating through thie elastos carrier there's, also going to be predefined side chains in the carrier. And they're going to provide as part of their software development kid. They essentially will provide the tools to help people create their block chains when they're writing, perhaps on top of it, quick.

Karim:

I got a little comment here. What i kind of like. So i'm just kind of mentally trying to visualize houses are going to work, and if i were, say, the apple app store, it makes a lot more sense for, you know, my blockchain to have x number of transactions on it every so many minutes. And if i have ten thousand apse that are built on my block chain, if i design my block chain in such a way where i have some number of side chains that my ten thousand aps are working on and each of those air reporting to the main chain every you know, one minute or so, however, along the time split is and then i can have. All of my transactions was recorded on a main block chain in a very simple, elegant manner that sounds very desirable for any number of participants, whether that be a programmer, a designer. Ah, yeah, user, i mean, ideally, that seems logically sound and clean and elegant as faras the design goes, i agree with you you and i think that one of the themes for this episode and again this is just sharing a personal opinion obviously but i think that the design of this project makes a lot of sense i think that it's well thought out i think that it provides solutions that makes sense that are logical that our novel that are unique now it is very ambitious and as far as are going to be able to pull off everything that they say that can pull off that's a different question you know so that's maybe where you can start talking about the khan says hey these guys are trying to take on a lot and they're very ambitious but the idea's makes sense all right so one of things that i want to dive into a little bit is the idea of digital property rights and how they think that they can create an economy for that so current technology allows for showing you who owns property you could say i own x y z but there's not really a good way to prevent people from stealing it from copying it from sharing it without permission so last this is asking the question you know can they create a new smart economy for these types of digital property items?

Mike:

So let's say for example the way that they do it by the way is by putting the digital property in the blockchain and then they want to create scarcity by allowing the author, for example, of a war to decide how many copies air going to exist. So i'll go through this process. Originally, when i heard this, i was kind of not so sure about it. But once we're done with this, i actually have a decent use case and a real life examples.

Karim:

Go ahead all.

Mike:

Right so let's see an author writes a book that he wants to put on the elastos blocking and this part of the smart economy he can actually decide that he's going to make five thousand copies and that's how many are going to be in circulation? This creates scarcity for the resource now the book is then sold and all the people who buy it essentially have a ownership idea that's associated with the book so when they accessed the block chain they can read it right but it can only be through that ownership that the book and be access is not like you could just be downloaded or read somewhere else but then since there's only five thousand copies of the book in circulation you could make it so that now that you bought this book you could now resell the book and it can also benefit the original author because you could make the smart contract logic such that they still get a cut. So instead of having all these middlemen like we always talk about let's say the bookstore or the barnes noble or the amazon the ideas here that the content creator could create the book issue five thousand copies okay there's your scarcity then it gets sold everybody buys it let's say for twenty dollars now they own the book if the book becomes x extremely popular in theory the price could actually go up because they're still only five thousand copies but now i paid twenty dollars for the book i would actually have the option to eventual we resell it maybe for last maybe four more and the original creator would also benefit because they're going to get a cut of that sale so it creates a kind of constant economy for that digital resource alright so that is very very interesting when i was first kind of listen teo and kind of reading this first thing i thought why would somebody only want five thousand copies of a book we'll actually have two great examples that i want to discuss your one i purchased a online web book that was a was a poker book and i paid significantly more than what the average face price of a book would cost but was from a very specific author and had what i would consider a lot of value so when i purchased this book i was given a log in to view the book in a certain type of way i was on ly allowed to view the book from two different sources if i chose to log in through my computer that i would on lee built a log and threw my phone i would not be able to use my ipad i would not be able to use my friend's computer i couldn't show it to other people it was on such a digital lock down that it actually turned me off to the process and i kind of regret purchasing the book for that reason this would definitely be a use case that could solve that another really interesting book type of discussion we good on is that the current market for audio books is really really bizarre and what i mean by that is i do sign up for audible and it's a very popular audiobooks program it interacts well with amazon interacts well with the apple store the android it's probably the most popular place for audio books however what used to happen is you could purchase an audio book for somebody you give a gift card you do something yada yada but what was happening is people are reselling their gifts on ebay or something along those lines or amazon whatever so audible decided they're going to stop letting people gift audio books to other people and now the only way that i could give someone an audio book is by signing them up for a three month service and what it would allow them to do is purchase a new book every three months or every one month for three months and then they would be able to listen to those three books but they would have to pay for any extra books they choose to purchase now conceptually like if i'm a customer and i am willing to pay the market price for a pdf book from a poker provider or an audio book from a really broad bookstore then i really feel like i should probably be on our own that asset in some fashion so i understand both sides of this like the poker book for example this is extremely valuable content i understand that the price is what it is but at what point is it mine and what point is it still the author's that's kind of a weird line that you know i don't know how to draw so this seems like it's heading in the right direction to be ableto fix those types of problems right, it seems to be creating a palatable solution that would address the author's concerns, right?

Karim:

Because you would only be able to access it one way.

Mike:

And if you wanted to sell it, you would have to find somebody and then on ly they would have access. But then the author would get a cut of that resell and you would have an opportunity to actually, i feel like you have ownership over the acid because you could sell it. You can access it where you know what i mean.

Karim:

But even to me, like the idea should still exist, i like giving books to people know i agree with you.

Mike:

I agree with you that day isn't if i if i had purchased an audio book and i want to give it to somebody, i should have the ability to take it off of my account and put on somebody else's account no, yeah, i agree with you completely.

Karim:

So i guess this is part of the process of digital assets maturing, right, and everybody trying to figure out this is going work you.

Mike:

Know for sure, and i definitely want to reiterate.

Karim:

I don't think that any of the parties involved here are militias. I just think that it's still every trying to figure out their role in how everyone's gonna get their value, because i think everybody deserves their piece of the pie. But i just feel like right now, there's, just some really weird limitation. And on this particular area, i agree.

Mike:

Now, you know, before we move on, i will say that i think this all sounds really great in a theory one and things that when we get into the pros and cons, i will say that the non coding aspects of this are also going to be very difficult to pull off and what i mean by that is let's say, for example, that they launch, how are they going to prevent somebody from running and getting a book? That's already been written by somebody else and essentially putting the acid on the block? Shame before the original author gets a chance to sow essentially what people do on youtube videos all the time, right where they're stealing content, they put it on their own channel and it gets views, but they're just copy basting. So how is that part going to be handled in ah, decentralized away? There might be some hurdles if that makes sense like it's not going to be super easy to do, but i like the general idea, and i will say that when it comes to the part about creating an economy where the consumer benefits because they can resell, but also the author benefits because they are getting a cut of the entire economic activity of the ass, it that's really interesting.

Karim:

Yeah, i definitely agree, and i don't want to sound like i think that they're just going to solve everything willy nilly. I definitely think that this is a massive overtaking, and part of the problem here is that how valuable is any of this? Until it's, very mass adopted? I feel like a lot of this is, you know, how valuable is it, webb smart contracts and limited circulation and digital property, right? How valuable is that when it doesn't have very much adoption? I mean, the answer is probably not very valuable. So when this hits that point, you know, and i don't know how long that might take, this could certainly be a very long term project. But if it does mature and they and as we've said many times, if they are capable of accommodating what they're putting out there, then, yes, this could be a very great project, right?

Mike:

I agree with you mind can i agree with you? So i'm going to go to move on teo a little bit more detail about their decentralized applications. So one of things that we mentioned earlier, right, is that the current blockchain tech has weak input output operations per second, essentially, they don't operate very quickly because block chains tend to be slow, right? You theory omise slow that's the problem we had with crypto kitties so elastos is going to try to solve that by using the side chains, allowing the aps to have their own individual side chain when necessary to run on the virtual machine and as mentioned earlier, they're going to provide some built in easy use support so that if a company or developer that doesn't have experience with blocking wants to develop on elastos there's going to be some support there for customizable side chains and figuring out what the priorities of the project itself are and an interesting concept, which is really different here? I wish i had more time to research in depth, but they're using something called emerged to mining, which i really hadn't stumbled upon.

Karim:

Yeah, as i'm reading your notes here, i'm very interested is that what you actually think of this?

Mike:

Yes. So essentially elastos is mining in conjunction with big coin because dave develop a protocol that essentially allows consensus to be reached on both chains at the same time so i did a superficial dive on this this might be its own wanna one by more or less the bitcoin blockchain functions as a parent block shing to elastos and they've created in such a way that miners that want to mine elastos khun submit proof of work to both blocks things at the same time and it essentially it works in a way when when a big coin hash is solved it gets transferred into the elastos blockchain now elastos actually ra has a block every two minutes while bitcoin has a block every ten minutes so i went into their subreddit to try to figure out okay so how are the mining at the same time and the explanation that i was given which makes sense but you know just explaining where i got the information but essentially there is mining going on for elastos every two minutes so not every hash in elastos goes on the bitcoin blockchain but every bitcoin hash goes into elastos does that make sense so it's almost like every fifth elastos hash is whatever hash is being put into bitcoin but without going too deep into the technicals the main idea is this is an incentive that it basically ties elastos to the bitcoin blockchain but it gives it away to get some of all of those computing resource is that are being aimed at bitcoin, because you can essentially go to the miners and say, hey, listen for almost no extra cost or value to you just by, you know, doing x y z, you could be mining elastos at the same time as your mining bitcoin and then the hash powers securing both network.

Karim:

All right, so this is pretty interesting, obviously. First thing that comes to mind, this is extremely ballsy on their end, and why i say that bitcoin is a very real chance of not being the king forever. If bitcoin starts to lose market share, thiss could really affect the longevity of this project. Now, do they have a parachute option or alternate plans? Maybe probably. I'm sure that that has come up, but i'm curious to your thoughts, like, don't you find it risky to just tie yourself with another very volatile crypto project?

Mike:

No. I don't find it risky because i think that we have two different she what goal is trying to be accomplished if that makes sense so when we talk about bitcoin maybe not being king what we're talking about is a market cap investment based perspective right like we're looking at it a speculators and saying well bitcoins number one now but it might be number thirtieth in twenty twenty five but does it matter if all you're trying to accomplish is a project is to get that computing proof of warp power to secure your network then as long as there's a considerable amount of computing power aimed at securing the network your goal is accomplished a market cap is independent of that so to me would only really be risky if they thought that big coin could lose the computing power that's aimed in its direction and i think that the odds of that are from little to none you know because big coin there's there's a reason why it's the big daddy and even if it lost the main market share i still think it would have thanh of resource is that are aimed at securing it and by the way part of the reason is because of this this is why sometimes we we're talking about our flagships or i would sometimes tell brent that i was much more optimistic about big coins future this is part of the reason because i don't think people understand that bitcoin doesn't just dominate because oh because it's a big coin and had first mover advantage but because of all the computing power that it's been accumulating all these years and all of the resource is and then all of the projects that are built on top of it it's like a snowball effect so now elastos is attaching itself to bitcoin which makes it even more of a guarantee that even the very action of elastos joining itself reduces the volatility or risk of big one going is your you know what i mean?

Karim:

God knows i agree with all that and again i'm only i'm not saying that bitcoin is definitely not part of the future i think if you had to ask me by the year twenty twenty five if bitcoin is twenty fifth and market cap i would still probably consider that a huge win for bitcoin because you know it'll be fifteen years in the blockchain by that point that'll be obviously like really impressive seventeen years i guess but i guess the other part of this that i find super interesting we are not fans of the proof of work system we think that it leaves an incredible environmental footprint on the entire ecosystem there's certainly like what if i don't think there will be but what if that day comes where they decide to move to either a split proof of steak, proof of work system or reduce or minimize the proof of work system within the blockchain itself, on bitcoin, i think that's a small percent chance of happening, but it certainly is possible. Don't you agree? I understand what you're saying, but i guess i would put it to you this way.

Mike:

I would reframe the question, if the bottom line what you're saying ultimately is, look at the bitcoin algorithm, everything could change, anything can change, right? But if you frame it in the perspective of if you're going to be a blockchain project and you have to attach yourself to another existing project, what is d safest, the longest running, most secure network that you can attach yourself to? And in that way, i would say that bitcoin is probably the least risky project that they could attach themselves to.

Karim:

I do agree with that completely, and as i'm kind of talking myself through this one thing that came to my mind, even if we view this, as and this kind of a weird example. But if we look at bitcoin as a large nation, like all to say, north america, united states, whatever, then, elastos would certainly be considered a smaller project. It could be like the equipment of the bahamas or a state within, you know, this large system. If those types of massive changes were to exist, i think elastos would be able to react quicker than bitcoin would, because of how many moving parts are involved in each one. So, you know, i'm just thinking as a skeptic and thinking about looking at all angles, the more i'm thinking about this, i don't think that or negative in any way, no.

Mike:

I think the questions make a lot of sense and i actually have to take advantage because you might have given me an accidental transition. That's great, i had a quote that i wasn't sure if i was going to use, but just based on what you just said, i have to use it so it's really interesting that you compared bitcoin to a country because, well, now we're talking about specifically about elastos when the founder was in an interview and he was essentially being asked, all right, so how does elastos make money what's the profit model and one of the answers that he gave was that elastos should not be compared to a company and here's the quote companies exist to profit smart economy is like a country, and the goal is to incubate its ecology ah, country aims to make its people live a comfortable life, not winning anything in the competition, so the concept is very different and elsewhere he basically says it runs like a country that test attacks. The network's survives by, you know, taxing the network, but it's most important to prom moat, the health and well being of all the participants in the network, so the founder of this project conceives of elastos in the sense of a country as well, so it was just interesting you used that analogy steem most certainly, and i'm kind of, you know, i definitely wanted to get this next topic.

Karim:

I've been curious about it since we started recording. What is the actual use case for the tokens?

Mike:

All right so we have to separate in elastos case because you're going tohave the a and that's the actual intrinsic token of elastos it could be traded it can be used for investing in digital assets to pay the blockchain processing fees but l a is the main core token that represents elastos and as a quick reference like a bow to bitcoin their smallest unit is s e l sela and its satoshi away basically and it's the minimum unit of the currency right so now another big difference here is that l a is inflationary unlike bitcoin which is deflationary right bitcoin is going towards twenty one million and that's going to be it the way l a works is thirty three million were created with you know like most projects they have a percentage that goes for the ecosystem some for investors some for crowdfunding some goes for the foundation but the way that the currency gross is at a four percent inflation rate per year the blocks are produced every two minutes and seventy percent of the block award goes towards minors and thirty percent goes towards the foundation which handles the development of the project much like the neo foundation or the iota foundation now separate of that which is its all of the decentralized applications that are created on top of elastos can have their own tokens and they'll have ways in which they can interact with the main blockchain but they can be separate as well, and one of the cool perks that they're created and this reminded me of dragon chain mike is they're gonna have something called sugar drops, which is essentially people who hold lola will get a share because any time a new token is created on elastos percentage of the new token goes towards the foundation, that foundation keep twenty percent and then distributed eighty percent amongst the holders of ella. So basically, if you hold ella, you'll constantly get little sprinkles of the you tokens, you know, little airdrops of everything that's being created on the ecosystem quick question for you here is their main that life there mainly is live, yet they have their own blockchain, and by the way, they're called sugar dividends.

Karim:

I'm not sure i think i called him sugar drops for them, but it's sugar dividends, by the way, sugar dividends.

Mike:

Okay, yeah, i can see how it's easy to mix up a sugar word so their main net is live correct.

Karim:

And, you know, people that are owning lola could potentially be getting those types of things already, or in the near future is that i believe in the near future that is right, anything else we wantto talk about and the features and structure section?

Mike:

No, you know, i think that's pretty much it, like there's.

Karim:

Some more details about how the elastos carrier work and more of the technical side, but to be honest with you, this is a project that is pretty intensive from thie coding and development side, and, of course, that's, not our expertise.

Mike:

That's, not our background. So it's, hard to say, evaluate that aspect of the project. As usual, we will provide links to the white paper and some medium articles, but that gives us a general idea of how the project is structured. You know, i think the real important take home there is thie way. The virtual machine is operating, and that the way that the decentralized abs exist within the virtual machine, as opposed to on the blotch ing itself. But i think we can move on to the pros and cons.

Karim:

Already. So i'll just touch on a few of the pros that i'm a big fan of. I like their vision like that. They're trying to accomplish something that would not necessarily make somebody rich, but it is it's solving some problems that are going to make the world a better place. I like that it has some really solid members on the team, from what i understand, and especially the creator wrong, chen that's. You know, i like you what his resume looks like, and i like the way that couple, the interviews. You, you regurgitated, sounded very like minded, so a big fan of that. What are the pros do you want to touch on?

Mike:

Yeah. So i definitely think i agree with you on the creator. I liked him, you know, that's, one of my personal preference is i always do that. I like to hear what the creators have to say. And i liked his vision. And he seemed competent and knowledgable about what he's doing. And obviously his drizzle me shows that he's qualified for the topic and that he's been working on this is a passion project for years, you know, not just like somebody that saw that blockchain was a way to get rich quick, but anyway that's pretty personal beyond that. I love the fact that everything in this project is being developed in published with the free open source license. So this is all open source and many of the interviews. He explains that in order for the blockchain tohave valium for this network, tohave valium for the virtual machine toe have value that it needs to be fully trusted by people and that's why they've made the decision to have everything be open source. So everything is transparent, which i think is fantastic, another pro. I mean, their partnerships are the real deal. Actually, i'm surprised that this project is not a little more popular because before you move on.

Karim:

While you were discussing this, i went ahead and look this up. Kucoin market cap. I was very, very surprised to see this was within the top one hundred. Because of how little hype i've heard about this project. As of this recording, this is ahh, seventy second overall market cap. That really surprised me based on the type of project that we've discussed, and it seems like there hasn't been a whole lot of pipes asked of me. So that surprises me, yeah.

Mike:

I know i agree with you now look it could possibly be because this is a project that is really developing in china and there might be a western bias there on our part too you know maybe it's just not discussed this much in our circles and it's starting to make its way but yet without question you would think that i would have heard more about this or you would've ever more about this based on some of the partnerships that they have so actually want to go into that a little bit they have a couple of important partnerships in the blockchain space specifically with you neo and with a bit mean now that's they're not a neo token there not in here twenty token their their their own thing but they have partnerships and relationships with neil and with bitte meine bitte mein being a major mining pool that's basically committed to commit the resource is or a portion of the resource is to work with elastos but then you have for example foxconn which is the largest electronics manufacturer in the world they have put in a thirty one million dollars sponsorship s i c motors which is basically the chinese tesla a partner it's like the car company that works with tesla within china they have a joint research partnership with elastos there's an app that focuses on sending their calls appia right? So look this is one of the examples with where i'm reading about the partisans and it says oh this abbs appia agrees to build on top of elastos and they're going to create a decentralized application and they do file exchange so the first thing i do is all right let me find this app and see how popular big it actually is not to diss up his big men on the android story it's got three hundred seventy two thousand reviews and it's at a four point five i went to go look at it at the apple store and it's also in the thousands four point five so it's not a tiny entity they are in collaboration with a vic which is the chinese airspace defense company which is also a fortune five hundred company so these guys are partnering up with ah lot of big players and serious players who are saying we're going to work on this we're going to develop this they're investing resource in this network so a couple of weeks ago we had the big newsbreak about verge and porn hub and you remember me saying that part of the reason i wasn't impresses because i don't feel like pornhub necessarily had to do a lot of due diligence to enter a partnership with virg so it doesn't really tell me much about virtue this is different this is major elektronik automobile airspace defends and file sharing companies saying oh yeah this is a serious project we won't engage with it and of course they would have to do their due diligence so i don't know man that's it's very impressive for sure yeah it's it's hard to argue in and certainly it's interesting because the types of of partnerships they have are of high quality partnerships and i know you're kind of touching on that a little bit but like a chinese tesler partner okay?

Karim:

Like cool, you know, the app of this size, you know, we talk a lot about how much we respect the neo community. I mean, these air, these air really interesting partnerships, i'm really surprised this kind of went under the radar under my nose for as long as that have i know we usually like to touch on where to buy, and we also forgot to mention at the very beginning cream do you own any of this?

Mike:

No, no, i actually hadn't even heard about this project, right?

Karim:

And i agree crypto candor, i believe she was being asked to you do a video on it, she was getting sick of being asked to do a video on it, so she wanted to do a research for shouldn't have time, so i think she kinda pawned it off on us, which, hey, i'm totally cool doing some backup work no matter where i am the way we were honored because she considers as a resource so thank you, she's like, hey boys, get on that episode, make it happen quick and well, yes, man so the where to buy is a little interesting there's, an exchange that i've never heard, ofthe and there's only four pairs.

Mike:

One of them is b b c e x.

Karim:

I'm trying to get the name of that right now. I don't even see a phony looks, a canadian exchange potentially, and they have a bitcoin paying there but the only place to get a schoolboy who, boy, and i'm pretty sure that is a korean exchange for recall correctly or chinese.

Mike:

I think they're like the really large china he's exchanging chinese.

Karim:

Yeah, that may i believe that i believe that that's accurate. So those are the only two markets that exist. So, you know, like a lot of projects that have not yet reached a large us exchange, like buying answer. Bittrex i think that there's probably, you know, some reasonable room for the future. You know, if something's cracking the top one hundred without that assistance that i think that's pretty interesting, yeah.

Mike:

And i would actually say you know since we were doing the pros and cons maybe you could argue that that's one of the cons right now the fact that it's only available on one change is kind of a con but you know it's probably a short lived con i don't want to make it seem like that's a particularly big deal i think that maybe the two more realistic cons that i see is one is that the scope of work exposes a lot of possible failure points especially with some specific concepts like you know what i was saying before about the digital media as they try to create a market place where people can share books how are they going to make sure that people are submitting plagiarized toe work and then taking credit for it and then how is that going to be corrected what is going to be the enforcement authority on a decentralized system maybe it's the application that's running it but you know actually that probably is what it will be so i guess that makes sense but you know kind of like you said there's going to be tough to get started getting off the ground because a lot of these air like market places you know when we were talking about the movies you made the comment well you know there's no traffic and really that's what it's about right? This is totally going to be dependent on the development of the network, if there's only three movies on there, nobody's gonna want to get movies from there, right? And if there's a huge catalogue and it's going to become the next big thing, so this is a super ambitious project. I could see some failures on some of the edges, but at the same time, hey, that you could say that about anything, you know. So you've got to create first and then solve the problems as they come.

Karim:

Yeah, that's, one of the unfortunate things when we worked on a young project because this really hasn't had a chance to even fail yet it hasn't had a chance to miss some significant deadlines. It hasn't had a chance for internal conflicts within the programming community within the, you know, within the developers of this having different opinions there's a lot of things that really haven't developed. So, you know, this might be one that would be better suited for our six month reviewer. Whatever we decide to end up doing with coins, long term right nowthe kansi mme fairly limited.

Mike:

Yeah, and i think maybe the last one that i could add is both a con and a program. Maybe it gives context, right? So let's, remember that this is a project that has been worked on for a long time now, since you know, the year two thousand that it attempted operating system launch in two thousand seven under different conditions. So there's two ways to look at this this can either be a project that has much more momentum with a team that has much more experience and vision, and maybe is going to be able to bring so much more to the space and just a brand new project. That was just an idea in someone's mind a few months ago, but at the same time, maybe there's a reason why this project hasn't been able to take off, and maybe idiots there's, other failure points that we're not seeing, and we could say, hey, listen, t maybe didn't work before, maybe it won't work. Now, i'll be honest with you. Overall, my impression is definitely be positive, especially based on the interviews with the creator, the the articulation of how they attempt to solve the problems and the equality of their partnerships there's just a lot to like, i can see why, why ah, crypto cantor wanted us to do this, i'm gonna have to co sign on that completely just to kind of reiterate some of your point.

Karim:

And i feel like you kind of listed this a little bit, but i just want to dig into it a little more about the cons. I still see a lot of competition and a lot of projects are trying to create the quote unquote, new internet. So, are we gonna have twenty internet ten years from now? I doubt it. Eyes. They're only going to be one or two that succeed. That's. Probably not true either. Now, does this mean that we end up with different browser types and that you just kind of you could use the elastos world to do your browsing or you could do you know, the thing i know brave is a decentralized internet on the block chain. That's, you know, should be a direct competitors. Er, i know this is one of the things that tron is trying to dio you know, i'm sure all this plus every other projects white paper combined, i don't see necessarily how they get mass adoption. I feel like it's it's a very difficult thing to protect who is going to capture the market and who is not, yeah.

Mike:

No understood you know and like division therefore is to just create an economy that grow slowly you know which is another thing that we can consider is good because it's an interesting point like oh so many people are trying to create a new internet is there going to be a new internet is there going to be one internet but we could say the same thing about block chains and currencies so many platforms so many currencies so you know it might be that we really are headed towards a future where rather than massive consolidation into very specific protocols or corporations or entities that were just going into a system where multiple networks get to operate and interact and i actually think that there's a lot of beauty and that organizational scheme and that there could be a lot of work many internets can exist if they can communicate with each other and you know not that this is a perfect analogy to this project it just i just thought about it here at the end but it kind of reminds me of reddit where i feel like the success of red it comes from the fact that each community is allowed to exist with different rules and operating procedures and moderating techniques and each community has its own priorities and values and moderation schemes and when they all interact together it's like this beautiful thing can emerge out of allowing these networks to exist and develop independently, even though they're all operating under, you know, read it, obviously, the centralized company i get that. But, you know, maybe it will be better with multiple block change, multiple currencies, multiple networks, multiple internet, you know, just interacting networks. That might be the future.

Karim:

Yeah, certainly could be a listen. Like we like competition. We don't want anything to be a monopoly. We prefer a lot of projects to take a decentralized approach. You know, i guess, on a scale of one to ten, how decentralize did this come up to you? Oh, i think, i think.

Mike:

Very decentralized. I mean, right now, right now, there's a development team. There's a couple of things where i could definitely nitpick. For example, as far as i understand that they have a foundation, not a treasure, really. The block reward is going to a foundation, not a treasury. Well, i'm always going to prefer a treasury because it's community driven, but, you know, it's hard to tell exactly how is the foundation set up, you know, could there be a future where it's not? I think in the best interests of the network, so little aspects like that, but everything is being written in open sores, everything is, you know, people could jump on the value, and this is really going to come from the decentralized applications, and they know it, and they are going, i believe, that they're acting in accordance to that, so that should create. They just want to create a network and see the economy that emerges from that. So we'll have to see just something that i am going to try to nit pick out a little bit as a potential con going back to the value of the token itself.

Karim:

How didyou or what opinion did you have on the percentage breakdown off the thirty three million tokens that were created, okay?

Mike:

So fifty percent went to ecosystem development, which, you know, you know, i'll be honest with you, it's, hard to tell honestly, because it really comes down to how that money spent because it they give us broad. So here it is, ecosystem development could mean it's exactly it's coming so much and eleven percent goes to the foundation, so i'm sure that a lot of the work that the foundation does could be considered ecosystem development, right?

Karim:

So, you know, it's hard to sit there and just look at it that way.

Mike:

I think i've seen better distribution systems, i've definitely seen better like treasury systems without questions, something like then cash or dash or pivx ix, but this is trying to do also do something different. So i guess within the context of what this project is trying to be, i like it a lot, and i think that it's doing the right things within the context of what cryptocurrency project could be from every angle, i think there's probably a couple of inefficiencies or kinks in the armor, but we'll have to see how it develops.

Karim:

All right, so i know i touched on brave, being one of the primary competitors to this, what else do you think is a direct, better well, the easy answers are the big platform, so i would say ethereum, kneel on cardano come to mind generally speaking, but i'll be honest with you the way that they're tryingto have the virtual machine just run on anything, and instead of just on the blocks in itself, i think it makes it less like ethereum and maybe more like cardano exclusive early, but i really like the quote from the creator when he was asked about, you know, cooperation versus competition and networks.

Mike:

And what about me? And what about these companies? And at the end of the day, he was talking about how what really matters is the ability to grow the network and grow the economy, not necessarily how it compares to something else. So he said, the conclusion is that elastos isa platform, it doesn't compete with anyone, and we welcome people to develop taps for our platform, basically saying any company, any network, whatever you are, we want to interact with you. We're not trying to compete with you, this's, just a developing network.

Karim:

Very, very cool stuff. So anything else we don't touch on four, move on to our personal future. Look, no.

Mike:

I mean, i think that more or less gives the general idea. I wish i could give a may be more technically detailed version of this. But i think this covers like a general overview of what they're trying to accomplish. I certainly don't like to give anything like a rating or a great on a project, because i don't believe that i'm qualified to do so. But what i would do is say, hey, you know, this project kind of passes my sniff test or it does'nt. I would feel pretty comfortable saying that this project does pass the sniff test, that it does seem serious, that's not saying that it will succeed. Or that they're gonna accomplish everything, simply saying that i take them seriously in their problem recognition and in their attempted solution.

Karim:

Yeah, and i'm going to echo that in a fairly similar fashion, i believe fairly strongly that this, if this is something that you decide to invest in and i speak very broadly is not financial advice. This is just it passes my test as it's, not something that i'm going to avoid. It's not something that i'm gonna, you know, put the black sharpie over it, cross off my list. This feels like something that you really on ly want an extremely long term investment for folio i don't see like cardano is a great example, like we'd love cardano and i don't expect any short term returns on cardano as an investment itself, it is something that is really in a very long term focus. I don't even check the price anymore, it's just it just doesn't even like the actual, like short term value of it doesn't even process in my brain, and i feel like that's going to definitely apply here is, well, if this is something that you like, continued to do your research, continue to stay up on it, but i just don't see any value in trading this or thinking in a two thousand eighteen window with this type of project, which is great for somebody like me that doesn't even think on that term anyway.

Mike:

No, listen, you've changed my views a lot in that regard and that's one of the many values that you know, this podcast has brought for me in particular, but i feel like it's still something that needs to be reminded from time to time.

Karim:

I agree, i just like to minimize expectations, you know, and i've drastically reduced my personal compulsive checking of prices of, you know, it's almost like i got neutered in the first quarter two thousand eighteen and now i'm just like a normal dog, then, you know, just obeys the rules and kind of stays in order, and i'm not trying to hump everything with the red rocket.

Mike:

So mike, one last thing i will say, though, which i know we've said this about a few projects, and i think that this is definitely one of them.

Karim:

I personally haven't decided whether i will invest in this project or not, i'll admit that i'm considering it.

Mike:

However, i am one hundred percent cheering for this project to succeed, you know what i mean? Like it's, good for the space of these gallo.

Karim:

Absolutely, absolutely. Listen, they pass almost all of our a requirements for a project that they have a decent team. They have a reasonable goal. They might be taking on a lot. But again, like that, they gotta show me they can't do it before i hold that against them. All right, is there anything else you want to add to the end here?

Mike:

No. I guess i would like to thank crypto candor for picking this and just remind everybody that we do have many different ways and contest in which you could also have the chance to pick what project we're going to do next. So this was because of our portfolio contest. But get on our discord because if you're a part of your community, we are going to give you chances to either win swag or, you know, like this get to pick the next project that we do. And honestly, everytime that somebody's picked a project for us or a concept idea for us, it's been great. So thank you for your participation. And if you're interested in being able to do something like this, get on our discord.

Karim:

Yeah. I definitely agree with that pretty strongly. We tend to get, you know, a new couple new faces every day that'll pop in and say, hey, you know, finally joined the discord. I've been listening for a while. We appreciate your stuff, thanks, and then they kind of just start interacting with the discord. They realize how it's, a vastly superior chat option to pretty much everything else is available both on the pc and the mobile device, so i strongly recommend getting involved, be a part of our community check every. Everything is nicely organized, assorted by conversation style it's, a super useful place for us to interact with the greedy and and i think that's going to wrap it up for the crypto basic podcast. My name is mike. I was here with karim, thanks again for tuning in you members of the crypto basic broadcaster, not financial advice is not financial advice.

Mike:

Don't forget to do your own research got used to a bunch of clams

The members of the CryptoBasic podcast are not financial advisors, and this information is provided for entertainment purposes. Please do your own research, and don't listen to these idiots.

The CryptoBasic Podcast is owned and operated by Cipher Consulting Group LLC.