Slock.it DAO demo at Devcon1: IoT + Blockchain


For those who do not know me, I’m Christoph Jentzsch. I am a theoretical physicist, that’s my background but I’m working with the C++ Team for Ethereum, and working on the tests for all the clients. that’s what I did last year. But now I want to tell you a little more about Slock.it. What is the problem we are trying to solve? Most of you have a lot of property. Think about your house,
your car, your washing machine, your lawn mower,
your bike, and more But you use them only about 5% of the time. Most of the time they just sit around and don’t do anything. so now the problem is: How could you rent, sell or share them easily? And that’s the problem, we are trying to solve. When you try to rent these, there are many problems that come up. such as: receiving the payment; the coordination. You actually have to meet someone and speak to someone. I am a German and we do not like to do this. We want it completely automated. We have to match the users some how and worry about all the security, and all this. So it’s a real problem to rent out small things, that only cost $1 to use: a bike for 20 minutes, or the washing machine. These are the problems that you have and the reason why you don’t do it. But maybe you do it for the big things and use a platform for it. But we want to show a solution. This is basically a lock which can be opened directly by paying IT. I mean paying the lock! We are not talking about paying someone else! How does this work? The basic process is quite simple. The owner of a “Slock” can set 2 numbers: the deposit and the price And then they are done They do not have to do anything else. Just lock their property with the Slock. Now when the user comes along, he just needs to pay the deposit. After he has done this, he has access to open and close or switch it on and off as often as he wants. He is the current user. and he can also set
other sub-users, such as family or friends because
he has paid for it. So you have a user management system included. And let’s say he used it for a couple of days, and then returns it. When he returns it, he gets back his deposit minus the cost. The payment for the cost goes directly to the owner. And this happens automatically on the Blockchain without anyone interfering. This is an illustration of the “Smart Contract” behind the Slock. So, how does this work under the hood? Of course, there is a Smart Lock connected to the Ethereum Blockchain. That’s why I’m talking here. What do we have? What belongs to a Slock? First, there’s the Smart Contract, which I just explained. Which is running on the
Ethereum Blockchain. Everyone can read it. The
code is open source. It’s actually so easy to understand both developers and non-developers can read it. This is just a part of it. This is a part of the closing
function, but I need to make it nicer after the
latest Solidity updates. Here you can see: The user gets the deposit back minus the costs. and the owner gets sent the costs. And then other edge cases are handled here. It’s really simple to read. How is the user interacting with the Smart Contract? All he can do is pay the deposit, open, reopen, close, that’s all the actions he does. On the other side, the owner, what he can do, through the Smart Contract, is set the deposit, a price. He can also open / close on a restricted basis. If it’s rented out he of course can not open/close it. But if the user has used up his deposit, then he can kick him out. All those rules are implemented in the Smart Contract. But how do we now get the connection between the Smart Contract and the device? So we have those little tiny imbedded devices and you see more and more coming. Like the Raspberry Pi. Many have played with it, but even better ones. You see there a little Intel Edision. Really really tiny! And we have a full client running on it. When I say a full client,
I mean a “Pruned client” so it doesn’t
need that much storage. the C++ Client of course 😉 And also in a couple of months there will be Samsung’s “ARTIK” coming out. Even tinier, and the spec is actually good enough that we can run a client on it. And those devices now can talk to existing “Smart Devices”. We can use Bluetooth, Z-Wave, ZigBee, and for those who do not know, Z-Wave or ZigBee it’s just used in smart
homes so it’s just smart home tech connecting all
the devices in your home. There are thousands of
different Z-Wave or ZigBee products out there, with
which we can connect to. I would not call us directly a
hardware manufacturer, we are just connecting to all of those
existing devices out there and just enable them to be controlled by the Blockchain, rather than just by an app. Because in the IoT you have
all these wonderful devices, but all you can do is
control them with an app. It’s nice, but controlling
them by the Blockchain, this gives you completely different
scenarios and use cases. Let us turn to our other products. What have we built so far? The first thing we will come out with is the SHS (Ethereum Computer) And now I will try a real life demo on the real live net. I really hope that it works. So turn off all your Wifi’s. This is what our app looks like, it runs on Android and iOS. So what is the user doing? If he knows the name of the Slocks that the Slock owner registered on the blockchain, then he gets the public key from there. Otherwise, he can type in the address or scan the QR code, to get the address and the public key of the Smart Contract. For now let’s use the last used Slocks. For example, a power switch The owner has set a deposit of 10 wie, a subunit of ether. Really low! And a price in Wei per minute. What I will do now is rent it. And this is now sending a
transaction on the Ethereum Blockchain and now we wait for
one block, to confirm it. But you can do this a
couple of days before. You don’t need to do it when
you are in front of it. So, we need one block to get this
transaction confirmed that’s actually happening on the live
Ethereum network right now. After this transaction goes through, I am the current user of this Smart Contract, and then I have access to open and close it That’s done ! Thank you miners! Now, for example if I push this “Open” button… … this power switch there goes on. Here it’s just a kettle, but you can think about a washing machine or a dryer, that you rent out in your shared apartment for example. Let’s just say in a shared apartment with 5 people one bought a washing machine, so if other people want to use it, they just pay an ether ($1). But you don’t have to handle these things. Payments are automated. The device is connected to the blockchain. You can have a lot of things behind the power outlet. Just get your imagination going! Industrial processes like paying money to use a big machine behind a power outlet. A lot of different use cases I can show you something else too for example a door lock If we just use a Smart Door Lock, I can do the same thing I see the deposit is now 100 ether and the price per day is 10 ether. so I am now renting out this door lock. I am just using my SHS (Ethereum Computer) to connect with all of these devices. So people who already have a
Smart Home can now control all those devices with the
SHS (Ethereum Computer). Basically you have an Ethereum client running in your home. There is this Start-Up, making the “Bitcoin Computer” … but here we have the Ethereum computer in your home, controlling all of your devices. So, let’s wait for the Miners … So they are done now! So here we have a closed door. This is the smart door lock you can buy on Amazon today. I can now say “Open”. And that will send a Whisper message (this is important) and confirm it. I hope you can all see it! It made a “click”! It’s turning around for those in the front seats, How does this work? For scalability, we do not want to send an ethereum transaction every time you open or close something, you only have an ethereum transaction for renting it and returning it. But in between we use Whisper
messages, where we can see if they are signed
by the right public key, which I can find in the Blockchain, if so, I execute open or close. Therefore it’s much faster
when you are in front of the door it takes 1 or 2 seconds
and it opens the door. You don’t need to wait one block to confirm this. So when I’m done using it, I can return it and get back my deposit minus the cost. and the owner gets the cost; it’s as simple as that. This is how the app works. Ok, another feature which I like: You can be in front of the device, but you don’t need to be. You may know that we have a bubble machine at our stand. I already rented it. And now I can open it and you can see the bubbles that come out. You can imagine that I am standing at a door and I don’t have money I just call a friend, “Could you please open this door for me.” “Just send some ether to this account and then it’s open.” Because the Blockchain is international. So, we will close it, because sometimes people don’t like to get so many bubbles. That was our product. What else do we have? This supports Z-Wave, ZigBee and Bluetooth. We made, I call it all in one box, the Slock Power Switch We have the tiny Intel Edison connected to a relay to switch power on and off. So you will not need the SHS (Ethereum Computer) for this. The SHS (Ethereum Computer)
is good if you want to control many devices in your
house, like the door lock, but if you want a cheaper all in one box then there is the Slock Power Switch. You can see the prototypes at our stand, if you want to try them out. But that’s really just the beginning. And we are currently
speaking to smart bike lock manufacturers to rent out
your bikes for example Just Slock it with a Slock and then you can leave it for 3 or 4 months. And people can just find
it, unlock it, leave it there, and with GPS you can say
where they should leave it So we are partnering up with a bike lock company. There is also a company building smart padlocks. So think about a locker
with some stuff in there, lock it, and people pay
to open it, and get it. I could imagine a store open
24/7 without any staff and the things in there are
simply locked with a Slock. You can go there in the middle of the
night because you really need this smart phone and then you just unlock
the lock, pay for it, grab it and go. So you can automate a lot of things. Everything you can lock, you can now rent, sell and share. So it’s a really powerful platform to be used. Every time I talk about this with someone, they come up with different use cases Like having a parking spot,
renting out the parking spot in front of your
door, or other use cases. Use your power outlet to charge cars. so that the cars can park right
outside your home and they pay you for giving them energy from your
house before they continue driving. There’s a lot of things you can do with this technology. Our vision of course is far greater than just the “Sharing Economy”. That’s where we want to start. The “Internet of Things” is going to be a big thing. I think the first thing when a developer sees this is: “Oh, scalability?” “You can’t do this on the Ethereum Blockchain?” True, and not true! The good thing is that’s a
problem for IBM and Samsung. They can not put all of their
devices on the Blockchain. But actually we can, because we don’t have that many
devices yet. So scalability is not a problem for us
in the next 2-3-4 years. I hope by then Vitalik has solved the problem. But in the next couple of years we won’t have a problem, because the Ethereum transactions
are only to rent and return it. Everything else
is just Whisper messages. There’s just basically a user control system on the Blockchain. We hope to be the first
ones to bring together the IoT and Blockchain
worlds on Ethereum. And I think these are the first
real prototypes working. Everyone’s talks about this big thing, IoT and
Blockchain, but we just did it. Ok I hope those things were amazing for you, but .. We have just another thing. A really cool thing. We are speaking to investors
and there are some awesome investors that
want to give us money, and how do we do the business model?
How can we make money? We talk
for hours about this. We have this Ethereum Blockchain now so we thought we can do much better today. We do not need to it the old way, we can do it the Blockchain way. What is the Blockchain way of creating a company? Of course, it needs to be a DAO! And I will today show
you how this DAO… Decentralized Autonomous
Organization will work. So you have a DAO and a service provider. I hope at first we will be the service provider, but actually they are free to choose any service provider they want. This DAO has, of course,
a Smart Contract on the Blockchain, that’s the
“constitution” of the DAO. What are the tasks of the DAO? First of all they fund the development. We will do a presale, a fundraiser, crowdfunding. That’s where we need your help. I will now explain to
you what you can get from this when you
participate in our presale. If you fund the development, you are able to vote on major decisions, and very importantly:
You control the Funds! So when we do this
crowdfunding, the money will not go just to us and
we can do good or bad, but you stay in complete control of the funds. and your goal is to be a profitable DAO. This is a For-Profit DAO. How does it work? You send some ether to
this DAO and you get some Slock tokens which show
membership in this DAO. You have a right to vote and most importantly, you get a reward. I will explain later how this
works, but you can think about this like buying shares in a company
and then getting dividends. I do not know if there are many
crypto tokens out there, aside from the volatility where you get dividends
on monthly or weekly basis. For what you invest, you get dividends, compared to how much we grow. I’ll explain how the dividends come to you. And of course you will vote
on important decisions, how to spend the money and where
to send the money to. Then you give some tasks
or orders to the service provider, usually through
a Smart Contract. What does the service provider do?
The first service provider will probably be
Slock.it GmbH in Germany. We produce the Slocks do the
marketing, the partnerships with all the hardware manufacturers which
are producing the Smart Locks. This is our task and we need money for doing this. But how are we rewarding you now? This is an interesting thing. We can do it automatically on the Blockchain. So that you do not need to
trust us to pay you out or send some money to the DAO.
But how do we do this? How is the reward going back to the DAO? There are 2 ways of doing this. The owner of a Slock has the option: Either he pays a certain percent
of each transaction as a fee, If I rent out this apartment I
pay 1% to the DAO every time, The DAO will vote on the percentage. If
you, the DAO make it high then it will be hard to sell Slocks, but if you
make it low we maybe can be sell more. So let’s say you have 0.5% -1% fee,
so every time something is using a Slock to rent something you get
a direct payment to the DAO, and you can get your shares all the time out of there. Without us interfering which
means if our GmbH is gone, (Like an LLC) if we are
gone you still get payment. As long as there are Slocks out there, you will get your money. We spoke to our Airbnb host, we are
staying at an Airbnb here and we just found out that our host is also
here, he knows about Blockchains and he wants to integrate this now, but he did not like to pay 1% all the time. He said he would like to have
a one-time deployment fee so you could free yourself
of paying 1% all the time. and instead pay a certain
amount of money, which the DAO decides how much this will be.
lets say, $10- $100 And every time someone
deploys a smart contract for his Slock, this money
goes directly to the DAO. We can make it happen
on the Blockchain, so that you who participated
in the crowdfunding, get your money back, every time a Slock is sold or used for sharing something. So this is a real DAO, the DAO stays in charge of the funds. And maybe if they have a good
marketing campaign going on they will send it to them, if they do a good
job we will send money to them again So not sending money to us is one step of control but the DAO really stays in control We are likely to use some nice tools that we saw here at DEVCON1. Some great tools for managing this DAO.
We will look into this and then make a decision
on which one to use. So that’s the complete picture. You have now seen for the first time a real DAO. We have spoken about this in the last 1 or 2 years, but now it’s happening. We have a real Decentralized
Autonomous Organization where you can participate,
buying shares and getting dividends back completely automatically on the Blockchain. So, if you believe that IoT, Blockchain and sharing economy have some future, …you should invest, and try this out and participate in this DAO. Now who are we? For now… This is the team. I have explained who I am, core developer on the C++ Team. And this guy has the same last name. Simon is my brother. He is a great developer, for over 20 years now
working for great German companies like Duetsche
Bank and other ones. And I think some of you will remember Stephan Tual. I hope so. He worked for VISA and for other big companies. He was the former CCO for Ethereum. I think he will do a great job on market development. We have a great team in place. And there are other people, like Griff Green, I have not mentioned him here. he is helping out right now to build this
community. We are building community we are building this DAO and in a couple months,
you will be able to participate in this DAO Thank You Very Much!!!

15 thoughts on “Slock.it DAO demo at Devcon1: IoT + Blockchain”

  1. It is incredibly powerful that this demo could be done on the live Ethereum network while presenting to a live audience. Ready for mainstream!

  2. This will make Ebay or Craigslist soooo much more convenient . if you could just have a locker in front of a Starbucks where you can leave items .

  3. You welcome!!! It was a pleasure for me translate that subtitle; it allowed me understand how wonderful is your project.

  4. Great Idea. Thanks for the presentation.
    One question: Do you deploy ONE smart contract for all the people who want to rent their home? or do you deploy ONE smart contract for each property that is being rented?

  5. Why is this the repetitive example I keep seeing. I've heard this idea 6 times from different organizations and even on shark tank

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