Picking the Right Blockchain for the Job

Today, I want to talk to you about
which blockchain is the “best” blockchain. Are you ready? Let’s ask the audience. Altogether, at the count of three, you shout
out which blockchain you think is the best. Three, two, one…
[Audience shouts] Fantastic. That is what subjective experience is all about.
We all have opinions, but opinions really don’t matter. It doesn’t matter if it is the “best”
blockchain in your opinion or not. Maybe it does matter if you are a trader,
and you need to guess what everybody else thinks it is. This is all about perception. I am not going
to tell you which blockchain is “the best.” I think that is a ridiculous question to even ask. It is a bit like asking, “What is the best car?”
“What is the best pair of shoes?” It depends on what you want to
achieve with this car or pair of shoes. If you ask someone what the best pair of shoes is,
they may tell you: strong hiking boots. If you ask someone else, they may tell you:
Manolo Blahniks. Have you ever tried hiking in Manolo Blahniks?
Have you ever walked a fashion show in hiking boots? They wouldn’t work so well, right? Purpose matters.
The purpose you want to build the tool for, matters. The purpose determines
what the best blockchain will be. The general question
“what is the best blockchain” makes no sense. You need to state the purpose. You can ask,
“What is the best blockchain for my purpose?” “What is the best cryptocurrency for my purpose?”
But you can’t just ask, “what is the best?” That makes no sense. If you start reading the marketing brochures,
I’m sure they will try to contradict what I just said. They will tell you, “This blockchain can do everything.
It is scalable, secure, and fast.” “It does smart contracts and sound money.” “It is quantum resistant, super private,
and uses military-grade encryption.” That last part just means 128-bit encryption… it’s bullshit, which is the purpose
of a marketing brochure, of course. People will [make a lot of promises] about their favourite
project, but you should really ask what the purpose is. What are you trying to achieve? In architecture, there is a great phrase from
the 1980s, which is: form follows function. The idea is, with any building, the way it looks
should communicate what it is used for. The form should follow the function; the architecture
of the building should reflect the purpose. The same thing applies to blockchains. The architecture of the system should
reflect what it is intended to be used for. But that is a very difficult thing to do, for architects,
software engineers, and product managers. It is even more difficult in open-source,
public blockchains. They are the only ones I care about
and think are interesting. It is difficult [to wade through] all of the opinions
about what a blockchain might do or will do. Pick any one of the open public blockchains
that exists today, and ask about twenty developers… working on it about what the primary purpose is.
“What is this thing supposed to do?” They will give you twenty different answers.
“Sound money.” “Digital cash.” “It will need big blocks.” “It will need small blocks.”
“It can handle smart contracts.” “It can do everything [you need].”
But what does it do for you? That is a more interesting question. You must decide
what fits the application you are trying to build. Unfortunately, that question is not asked a lot. You can tell, because people are still trying
to apply blockchain technology… to a whole bunch of things that don’t need a blockchain. I have considered wearing a t-shirt at all conferences
which says, “You don’t need a blockchain for that.” [Laughter] When I am attending a hackathon
and they present applications, someone claims, “We have put digital music on the blockchain.”
You don’t need a blockchain for that. Why would you need a blockchain for that? I should just write that question on
a sign and pick it up every time. What does a blockchain do?
It is not a content database. It is not just somewhere you record digital signatures.
You certainly don’t need a blockchain for just that. It is not scalable or efficient. It is decentralized, secure, and (for the ones
I care about) very robust against censorship. That means it should keep running even
when very powerful people or organizations… want to stop it from running. For that use case, you need a blockchain.
But what kind? How would you design it? Let’s talk about the engineering challenges when
building these systems. You need to make choices. Some of these choices come up at the very early stage. For example, do I want to build a system that
is very specific, or with a broad generic purpose? Why don’t we just do both? You can’t do both. Systems that are specific need
to be optimised for that purpose. In doing so, they are no longer flexible
enough to handle the general purpose. Systems that are general-purpose don’t have the unique
characteristics you need for specific applications. That should be a conscious decision at the beginning. Some blockchains are designed for rather specific
applications; some blockchains are designed… to handle generic applications. Both often claim that they can be both. Once you have made a decision on that first
question, you need to make further decisions, all of which involve more intractable trade-offs.
“Intractable” means, you can’t get both sides. I must choose [one or the other]. That choice then
determines the path that the blockchain will take. As a developer, designer, or architect,
you don’t [have the power] to tell the market… how they will use your product. If you try to be too specific, the market may
decide that it is not suitable for what they need. If you try to be too generic, but you only
have one type of application in mind, the market may decide to use it for
a completely different type of application. Hopefully, they will. As a developer, designer, or architect, you rarely have
the exclusive knowledge of what other people need. There is too much variety. You can barely imagine what people might need
in other places in the world that you don’t understand, under different circumstances than your own. You certainly can’t do that across a broad timefame. We are building systems that might last,
should last, will last, for decades. What do people need today?
What will people need in 30 years? Very different answers. The developers who are making these very careful
trade-offs, need to consider that they are… making those decisions with incomplete information. Even if they try to design someting with very specific
applications in mind, the market may decide… to do something completely different. Back to architecture history. In the 1960s and 1970s, in California, they
made swimming pools in organic shapes. No longer square, but with curves.
Have you seen those types of swimming pools? Then there was a big drought; for a couple years,
it was forbidden to fill your swimming pool… because there wasn’t enough water.
Guess what happened next? Skateboarding exploded in popularity across California. Skateboarders saw those curves and thought, ‘If I stand on the edge and kick down,
we could have some fun with this!’ All of the swimming pools which had been designed
with curves, became the first skate parks. Skateboarding wasn’t a big deal before then
and mostly involved [riding] in straight, flat lines. That sport was transformed. Do you think the swimmming pool designers
could imagine that, ten years later, some snotty nosed kid would go
wizzing around them on wheels? No. Form follows function… sometimes.
Sometimes, it doesn’t. Sometimes the form follows the function that
the designer thought it would have, and then the market says, “I have another function
that fits perfectly with this curve.” You can never know how that will play out.
The same thing will happen with blockchains. Ultimately, the users and the market decide. You can have all the ideas you want,
and yet here we are, arguing about it. Maybe we will have a panel of six very serious experts.
Some of them will say, “It is a store-of-value.” Somebody else will say, “It is a medium-of-exchange.” Another one will say, “It can’t be a unit-of-account,
because the volatility is too high.” And then someone will say,
“Maybe we should focus on smart contracts.” But they don’t really know what they’re talking about,
because they don’t get to decide [for everyone]. These are opinions, but they [don’t
represent every] user. Users will decide. You can make something that seems to fit better with
a store-of-value use case, or a smart contracts use case. The developers and designers of Bitcoin
had some ideas about it being digital cash. For some period of time, it plays as digital cash. For another period of time,
it plays as speculative gambling money. And in other times, it plays as a store-of-value, especially
in countries where their currency is distressed. Which of those will it be? We don’t know.
It depends on a lot of factors that we don’t know yet. It depends on what happens to national currencies
and inflation in the U.S., Europe, and Japan. It depends on how the world transforms. It depends on whether cash, as it exists today,
will still exist in fifteen years. All of these factors have nothing to do with Bitcoin. The designers of Ethereum had certain applications
in mind, mostly engineering applications. Did they think it would become a platform for launching
ten thousand scams and pump-and-dumps? [Laughter] No, but it was very good at that! A generic, flexible platform to build whatever
smart contract you can imagine, will attract… the kind of person who wants to build
a beautifully engineered pump-and-dump scheme. Does that change what Ethereum does
[as a whole]? No. It just means, it was a niche that
the market decided was really hot. Why? Because a whole bunch of naive investors,
and even more naive venture capitalists, were throwing as much money
as possible into this new space. Two years ago, you could attach “blockchain”
to any other word, and a venture capitalist… would throw a couple million dollars at you. Music? Blockchain. Movies? Blockchain!
Real-estate? Blockchain. Blockchain real-estate? Asparagus? Blockchain asparagus.
“Two million dollars for ou, sir. That sounds fascinating.” You could even combine it with the other ‘cool’ words. “We will cultivate asparagus with blockchain-based,
artificial intelligence directed autonomous drones.” [Laughter] That way, you could check all of the boxes,
and they would throw tens of millions of dollars at you. None of it made any sense! The market not only decides [rationally], but sometimes
the market is stupid, crazy, and irrational. It is driven by sentiment and emotion.
Over the next decade, things will calm down. People will figure out that
you don’t need a blockchain for that. How will most of them figure that out?
They will invest their money and then lose their money. They will invest more of their money
and then lose it again. By the third loss, most smart investors
would start picking up on that pattern. For the less smart investors, it may take them
ten or fifteen rounds of losses. The bottom line is, there is no “best” for every purpose. The people involved in making difficult trade-offs every
day, cannot design for a purpose that is too specific. That can be limiting and miss what the market
may want to do. They can miss the timing. They also cant design something that is too
generic, because it won’t have enough… powerful capabilities to solve
real problems that we have. They will need to make difficult trade-offs. You can’t simply be scalable, decentralized,
secure, and fast [at the same time]. In engineering terms,
there are some fundamental trade-offs. We categorize them as dilemmas or trilemmas. A classic trilemma is: security,
decentralization, and scalability. In a trilemma, you can only
pick two of the three [options]. If you make something that is maximally scalable
and secure, it probalby won’t be very decentralized. If you make something that is maximally scalable
and decentralized, it probably won’t be secure. If you make something that is maximally decentralized
and secure, it probably won’t be very scalable. Of course, there will be blockchain projects
that tell you, “We can do all three!” That means they don’t understand the trade-off,
which is even more dangerous. There are two possibilities: lying or ignorance.
Ignorance of the trilemma is far worse. This is what I used to tell my consultation clients:
“I can deliver the solution fast, cheap, or great. Pick two.” “I can do it fast and cheap, but it won’t be the best.
I can do it cheap and it will be great, but it won’t be fast.” “I can do it fast and it will be great,
but trust me, it won’t be cheap!” That is the essence of a trilemma we face every day
in life. Life involves choices. Think of it as a journey. When you go through the door on the left,
you may lose whatever is through the right door. You may never be able to go back and take
that road, and the roads that branch off from it. You have made your choice. When dealing with building the best blockchain
for a specific purpose, every choice you make, whether you know it or not, can close
as many possibilities as it opens. The next time someone asks you,
“What is the best blockchain,” instead of shouting out the name of your favourite,
ask “For what?” Thank you very much! [Applause]

82 thoughts on “Picking the Right Blockchain for the Job”

  1. Great speech again! I can't believe someone from Bulgaria where the biggest bank run out with the people's money 5 years ago with the involvement of the government and was equivalent to Ecuador and Zimbabwe during 90's could ask a question how good is centralised blockchain!?!

  2. Every month more and more alt coins spring up and the value of their shares decrease since the number of tokens constantly increase. So basically the token supply is infinite so store of value goes out the window. With bitcoin however the supply is limited. Alts may be getting printed and spawned into infinity but Bitcoin is solid! That's why I'm a bitcoin maximalist.

  3. Phantasma Chain is going to be one of the best in my opinion 🙂 the tokenomics are amazing and how they'll change the way dApps link from various blockchains including blockchain games ! But as Andreas said – Mostly for gamers

  4. Andreas, just pull up a chart for anything other than BTC, best is not even subjective anymore, it's straight up empirical at this point

  5. Are BTC maximalists now confused?
    By the way Andreas, when Cardano standard? Because it can.
    There is not only a lie or ignorance – there is scientific research too.

  6. So after experiencing flying an AIRPLANE, Mr ANTONOV is exploring jumping in the void with a PARACHUTE ? ( i remember by my own experience, that JUMPING with an unknown parachute which has been packed by a unknown beginner parachutist ( which is the imposed reality when you learn to jump in any parachuting school), can be a SCARY experience… especialy for people very concerned by safety and transparence. Personaly, i would not have continue my training without buying my very own PARACHUTE. So : good & safe jump Mr Andreas ( lucky man)

  7. re: trilemma. i don't understand the point of saying it is impossible to make progress in all three dimensions at the same time. that is obviously not true. you can find better ways to do things that may have huge advantages in one dimension, but only sacrifice a little in the other dimensions. it is not a 1:1 tradeoff between dimensions. you just have to think longer to tighten the triangle

  8. Andreas, regarding the trilemma dilemma, I believe than no other blockchain related project that I can identify comes closer to Elastos in solving this problem. “First and foremost, it's important to note that Elastos is not a blockchain project. It is a network operating system project powered by the blockchain technology. So in that sense, Elastos is not competing with any other blockchain projects but can work together with them to form this new ecosystem where the DApps run directly on the device instead of running on the blockchain along with decentralized peer to peer network to transfer assets in a completely closed sandboxed environment, thereby solving the trilemma of the blockchain technology – security, scalibility and decentralization all in one.” Elastos is also one of the only blockchains Merged minded with Bitcoin & therefore has greater security than other blockchains excluding Bitcoin itself. If I am being misinformed or “ignorant” about this, please inform me how & why. Thanks!

  9. Wow, I used to literally catch every word of this guy, but now it seems I have my own opinion on each individual case. Is it me or is it you who changed? Both of us, I guess.

  10. Ravencoin is being developed to become a securities token platform… I saw that and decided to use it to create a viewer reward system for my youtube channel. lol

  11. Never give up! They will fight us and we will win! It doesn't matter how many times you fall! It matters how many times you get back up! Never give up! Win!

  12. $cloak for privacy and knowing it can’t be fraudulently inflated because it’s the only auditable privacy coin for supply… which is REALLY important.

  13. My friends and I have faced articles, media contents, forums, and social media being censored and taken down. We need a blockchain for that.

  14. What do individuals need? A personal, globally distributed supercomputer that can be accessed from any device that can connect to its network. The best thing we can do with the trilemma is to balance it and create separate blockchains for separate trust functions (IDs, tokens, applications) that all connect to a main chain secured by Bitcoin's hashpower. Beyond that we need a P2P communications network that's distinct from the blockchain, decentralised storage, and a sandboxed runtime environment for everyone's assets. Individuals don't realise it yet, but in time they'll need Elastos. It's currently the only solution that goes beyond blockchain to synthesise these various components, addressing the fundamental flawed architecture of the internet; the great problem of our time.

  15. We are talking decentralized blockchains operating inside a world of centralized internet. How easy is it to get free access to Internet without an ISP? How much control an ISP has over your internet? We need to first address decentralized and free access to Internet first.

  16. If censorship resistance is the reason to choose a Blockchain over a database, then only Bitcoin can be chosen, because all alts are not really censorship resistant. Take for example Ethereum, they have censored and changed rules multiple times, and look at EOS, they have literally censored several accounts already.

  17. 17:08 mins – WRONG once again Andreas. You can have a DLT that is scalable, decentralised, secure and fast. You're gonna eat your words next year.. hope you have the guts to admit you were wrong.

  18. I have to disagree with Andreas. If you want to blockchain to really be useful, it's going to be Bitcoin. If you want a less secure blockchain (which misses the whole point of blockchain) then you create a centralized Network.

  19. I need help to build a voting system against the evil Islamic regime of Iran who recently put 20 years old girl in jail for 25 years because she refused to wear Hijabs

  20. No totally disagree with Andreas here. Seems like he is smelling the short comings of the ancient bitcoin blockchain and tries to justify its existence. The best blockchain is the fastest, most scalable, cost efficient, decentralized and secure one. For example "Why would you ride on a horse and buggy to go shopping today just because you have enough time"? At its core every blockchain tries to do the same thing >>> creating secure ledger entries! It is pointless to keep an outdated blockchain around for anything if there are better alternatives. It would be silly to lock yourself down with a slow purpose build blockchain just because it justifies the need at the moment. Future purpose may change and then you are stuck. The base layer blockchain has to be the fasted most decentralized and secure! Second layer blockchains can be slow and purpose build. Unfortunately Bitcoin doesn't qualify.

  21. You are wrong about the trilemma Andreas.
    Technological advancement inevitably solves or can solve every trilemma relative to the point in time for context.
    Example the industrial revolution. companies with machines as opposed to all human labour became –
    1) the cheapest
    2) the fastest
    3) the best and most consistent quality
    A million more examples like this exist but I want to keep the comment short and to the point

  22. I think your correct that each coin has it's own function and Overall, I think cardano will be the one of the main coins.
    The way we look at dollars and cents is over. It could be certain coins for certain items. Medical, automotive, food & clothes shopping,, traveling, etc.

  23. ICON $ICX on september 24 will be decentralize, end of the year 10k tps, 2s block confirmation, staking rewards from 6% to 36%, smart contracts and secure. So yes, it is a unicorn in this space, and patience will be rewarded. DYOR.

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