The Hype About Developing on Blockchain


VOICE: John. WOLPERT: Yes. VOICE: We’re live. WOLPERT: Well, hey, everybody. This is John Wolpert. I’m the offerings director for IBM Blockchain. And it’s good to be with you all. We’re here to talk about blockchain and
in fact, I was just minutes ago on stage with Don Tapscott and Alex Tapscott
and a bunch of other folks talking about this very subject here at
the NASDAQ center in San Francisco. And the room was packed. And Mr. Tapscott, who’s been sort of the augur
and oracle of great change in the Internet, was very clear that this is the next
thing in the evolution of the Internet. So, I guess we’re all on the right topic. And so today, we’re going to talk about
blockchain and what IBM is doing with it. I’m going to start by just saying the
simplest way I’ve ever explained this, the way I explain it to my mom what blockchain
is, is it’s the Internet’s permanent marker. It’s a Sharpie® for the Internet. That is, if I give you…think
about a dollar bill. If I give you a dollar bill and you take it. It’s an amazing piece of technology. It’s a final settlement. Unless I robbed you of it, I can’t get it back. And I can be sure unless I’ve
counterfeited it that when I give it to you, I no longer have it and it’s unique. The transaction is immutable and I didn’t
invent money by handing you my dollar. It’s no longer with me and now it’s with you. Try to do that with ones and
zeros on the Internet, a distance. And suddenly, you have to have lots of
intermediaries and trusted agents whose job — and it’s kind of a scary job
— is to make sure that none of those things I just described happen. If I take a picture of that dollar bill with my
iPhone and send it to you, I’ve sent you a bunch of ones and zeros that purport to be that
picture but it’s not necessarily identical one. It’s not the original article and I still have
a copy of it or I could on my phone as well. So, I would duplicate it just
in transmitting it to you. Well, blockchain prevents all that. It allows to you transfer valuable assets
between legally separate entities in a final way that where the rules by which that
transfer is made, like if I say I’m going to give you 15 cookies if you give me
20 donuts, but if you give me 20 donuts within 15 days, I’ll give you 20 cookies. I can write that in a piece of code. I can write it in Java, I
could write it in Assembly. But if I control that code,
I could change the code. You control the code, you could change the code. But if I click that code in
a transaction on blockchain and say this is our immutable…our permanent
marker of an agreement, then we can then we know that that can’t be changed by anyone because
the properties of the blockchain and the fact that there are many, many organizations legally
separate that are maintaining the integrity of that event log, of that
ledger, as we call it. Blockchain is a ledger of assets that are
shared between a network of individuals who are working towards transferring
something, a good, tangible or intangible. Bitcoin, of course, is the case that we
hear about as the original use of blockchain or at least modern blockchain
as we know it today and that’s a great…that’s a
one use case is cryptocurrency. What IBM has done and what many
other companies have done is said, hey, that’s kind of like Napster. It’s giving us really good ideas
how to do something more mainstream, not so much on the fringe, within business. So, I mean, would you have
iTunes without Napster? Would you have Netflix without BitTorrent? Maybe not. And so once again, Bitcoin kind of
said, hey, we have a new pattern, and industry now is getting behind that and
saying we can use that for a lot of stuff. Not just cryptocurrency, but more supply
chain; obviously, interbank payments, remittances, letters of and identity. So, the blockchain-based systems could radically
improve whole industries beginning with banking and insurance we’re seeing but really supply
chain I think is probably the killer area, corporate loans, international trade,
bills of lading, all sorts of areas. Today you’re going to hear from some blockchain
experts about this technology and learn about new tools and to get started on your
first blockchain projects and that line, your first blockchain projects,
that’s what this is all about. I don’t know what you’re doing
sitting around watching me for. You should be going to hyperledger.org or
ibm.com/blockchain and you can spin up an IBM or a blockchain network in about two
minutes with one click of a button and you can start writing code to it today. Just go to ibm.com/blockchain and there you go. We’re hosting this hangout because we know
that only with openness and the contribution of developers like you guys will
we flourish and let Hyperledger, which is one of the largest open source
communities in the world just a few months after we start it with a
bunch of other companies. The Linux Foundation, hyperledger.org is out
there and it needs all of you contributing to the code just like Linux or any other open
source, openly governed open source community. So, Zaki is from…Zaki Manian is the founder
of Skuchain which is just an awesome company. We love these guys. He’s going to have some things to say. Zaki, could you introduce yourself and
talk about how you made this transition from a developer to a founder of
blockchain business and your recent work on using blockchains in supply chain. MANIAN: Great. Thank you. So, my name is Zaki Manian. I am the cofounder of a company called Skuchain
and Skuchain is basically…was founded around the idea of applying the
non-cryptocurrency ideas around blockchain to the problem with the supply chain. Sort of I have been sort of a
polyglot developer in my career. I have done lots of different
things from embedded systems. I got interested in cryptography and security,
cryptocurrencies about four years ago. And I’ve sort of just been obsessed with them. But when myself and my cofounder
Sriram, we met at a Bitcoin meetup. And as much as we were both
interested in cryptocurrency, we both saw that there was a real opportunity
to take the design pattern that was in the Bitcoin code base and
apply it to supply chains. And I’d been, you know, I’d built a
medical device and had a lot of exposure for how much friction there is in
the way in which supply chains work. There’s just…nothing is digital. Everything is, to the extent that it’s
digital is spreadsheets and email. There’s no formal system. There’s no rules. Trust is hard, everything is slow. It’s hard to get paid. It’s hard to know where things are. It’s hard to know where all the companies
that you’re working with are; and you know, making sure everyone is on the same page. And I just thought that there
was no more natural application of this technology than supply chain. So, what Skuchain has been doing
is we’ve been working with banks. We’ve been working with logistics companies. We’ve been working with freight forwarders. Really understanding the nitty gritty of how
blockchain can create real opportunities to sort of unite the flow of money and the flow of
goods and bring about sort of a new revolution, what we call collaborative commerce. And basically the idea is take all these
companies that don’t really trust each other and have some adversarial interests and allow
them to collaborate with a secure set of rules. WOLPERT: Sorry about that. I went on mute. So, thanks, Zaki. You know, supply chain seems to us
to be an incredibly important area because it applies the best
of rules for blockchain. And blockchain is not a perfect
pattern for everything. It’s right for some things and not for others. The thing that we always watch for is do
you have a set of legally separate entities who cannot countenance or allow for any
of those entities…any other entity or third party even the government to
run or manage or control the system through which they have to do business. So, I remember [Arriba] back in the 1990s and
how they wanted to centralize the supply chain. They wanted to make it more efficient. And that was their purpose. You know, these powerful companies, everyone
from a WalMart type company to a shipper or a freight forwarder or a
port, you know, shipping company. They really didn’t want one company
to have all the power in the system. And so blockchain seems like a good approach
now because all of us have control but none of us are in control of the others. Now, what say you to that? MANIAN: So, I think we’ve basically,
you know, you hit the nail on the head. I ask myself as a developer, again, you
go to meetings sometimes and you talk to potential customers and you listen
to their problems and you’re like, yes, you have some problems, they’re
not…the solution isn’t a blockchain. But why in the area of supply chain the
cloud has never really been able to deliver. The cloud has built a huge
number of successful companies. But you need something extra. You need to add something on top of your
traditional cloud based solutions in order to really deliver on the
needs of the supply chain. And where we…where Skuchain has been
conceiving and in the supply chain space, there’s going to be, I think, a huge number
of different blockchain-related products for everything from bills of lading to tracking
of, you know, who owns the obligation to pay, who owns the goods that are
sitting in the warehouse. Keeping the freight forwarder and
their customers on the same page. Huge number of products that
are going to be invented. But every one of those products has one
requirement which is you don’t want to build in a centralized point of trust that
then can be…will inevitably be abused. Because in the history of supply chain, every
single time this has happened it has been abused and then the industry steps back and said
we’re going to constrain your business to a little piece of the puzzle
and you can’t own the supply chain. WOLPERT: Right on. So, we’ll come back to Zaki and Louis, you
can keep me honest on time and comments. But I’d like to move on to Meeta Yadav who
is IBM’s chief data officer for blockchain. So, it’s cool we have one of those. And Meeta, at that can you say a few things about
yourself and go over the technical skills needed to be a blockchain developer
and maybe some key market trends that you’ve been seeing with blockchain lately. YADAV: Hello, everyone. I’m Meeta Yadav, the chief data officer
for IBM blockchain technologies. That means I just get to
play with a ton of data. So, to echo what John and Zaki were saying, blockchain is a design pattern
made famous by Bitcoin. But its users go far beyond. This technology we believe and we are seeing
it now can help us reimagine the world’s most fundamental business interactions
and open doors to new ones. The industry we’re increasingly
seeing it from a customer meeting to customer meeting is getting ready to embrace
blockchain and to imagine new business ideas; and honestly, sometimes they’re
afraid of being disrupted as well. So, be it banking, insurance, digital rights
management, supply chain, diamond industry, everyone in the business of asset
transfer is interested in this technology. But I believe and my team believes that
these businesses can only be reimagined and reinvented by pioneering developers. This technology will truly reach its
potential if it’s only built on the shoulders of imaginative, curious and not
conformist, thinkers and developers. Only with openness and the
contribution of developers around the world will this innovation
flourish and blockchain be widely adopted. So, if, you know, I really
believe in my team is a bunch of nonconformist imaginative curious
people which can be challenging at times but fun most of the time. So, to look at what skills are
needed by developers, I look for data and I interviewed my team members and I asked
them what were the key skills they thought were needed. And the one overwhelming skill that
they said was needed was an open mind. So, blockchain-based systems if you get down
to the basics are modular and can be broken down into two categories, the foundation
piece and the business application piece. So, foundation is the core
of how blockchain works. IBM is at the heart of the Hyperledger
Project, like John said. So, to contribute to the
foundation of blockchain, the key skills that are required are an
understanding of distributed systems, messaging, databases, cryptography, networking and
security — so, some of the traditional skills. Now, to stand up this service in the cloud
and understanding cloud computing and large-scale microservice architecture,
it’s very important as well. Now, when we come to the realm
of business applications, we believe that great applications
will be developed by polyglot developers, people like Zaki. My team and I are not partial to
any one programming languages. Our background, we are mathematicians,
astrophysicists and chip designers who choose to embrace technology. I still teach chip design
courses at the local university. So, an understanding of how…building
really cool applications which you think will be disruptive
I think is the way to go. And understanding of how these applications
will interact with the foundation, their ability to write chaincode, for example. Deal with large data sets, URI skills. They all fall in this category
of business applications. Now, we start looking at the trends, right? We’re seeing more and more money
flowing into fintech space, $11 billion were invested in 2015. All major tech companies are investing in
blockchain, whether it’s IBM or Microsoft. All major banks and financial
industries are investing in blockchain. Google Trends, it was fascinating to find this. Google Trends indicate interest in
blockchain is increasing compared to big data and cloud computing. So, and we have this data out for you
in a blog post and you can see that. That was fascinating to see. A quick search of blockchain [get
open later] shows that we have about 250 code bases and 1,600 repositories. And it was just a search
of the keyword blockchain. So, if we searched for other
variations of it, we would find more. And so the future as predicted by
data and the gut instincts of veterans of [fair plays] looks very promising. So, I would recommend that you jump on the
bandwagon and start disrupting the world. Thanks, John. WOLPERT: Thanks, Meeta. And by the way, there’s a couple
ways you can jump on the bandwagon. One is to be what we call node
zero in a blockchain network. You’re going to hear a lot
more about that from us. We don’t see what IBM, what we’re
doing as so much a, you know, traditional technology supplier, you know. We’re not selling software. What we’re doing is helping viral
business networks start and proliferate. And we think of blockchain as in fact
a very viral kind of technology pattern in that it looks like a singleton. It looks like a centralized system but it
isn’t so you don’t have the political problems of a centralized system or the
reticence of participants to play on someone’s especially centralized system. And yet, it’s as easy to connect to
and be part of as a centralized system. That makes it potentially viral
depending on the use case. And then also, because you can write
different applications or different chain code as we call it or smart contracts to
it, you can then scope so it’s viral. It’s a three-dimensional viral vector because
you can say start with supply chain providence and then go into actual supply chain and then into…and you have just two companies
just doing, say, conflict material avoidance or tracking and then you can go get into
shipping and then into trade finance and letters of credit and bills of lading. And now you’ve got companies joining the
network and then you’ve got different solutions in that same network that even more
companies join including the regulator and the government and auditors, your banks. It can become very viral. So, and it can all start by you just creating
node zero, the very first node in the network. And that’s something that you’ll be able to
do with Hyperledger and with IBM Blockchain. And so the two things you can do to get
involved are join the hyperledger.org foundation and start writing code and checking it in. It’s a democrative…it’s a meritocracy system. So, you know, you could be one dude or
one college student or…and writing code and if your code is the stuff
that’s getting accepted by the community, you could
become the maintainer. And over time. And the other thing is you can start
writing applications and you can start doing that with IBM Blockchain on Bluemix right now. Takes two minutes to start. So, Meeta, thanks for that. Are you…what are you seeing in terms
of the trend upwards as far as usage of IBM Blockchain, say, versus other fabrics? YADAV: So, sorry, I was on mute. The trend has been more than upwards and I
hang out with the developers all the time. And you know, we run and we have to
scramble every time and increase the capacity because we just see such fast growth. If we look at our trend line, the slope on the
trend line has been changing so frequently on us and it’s almost going up straight now. So, it’s been very, very tremendous. We’ve broken it down into different
categories on where we see growth. So, we are seeing growth from
startups, from individual developers, from different companies interested in
using the Blockchain service and you know, we have an internal growth within
IBM as well which we see going up. But it’s been tremendous. WOLPERT: That’s fantastic. Not to be ad-sy about it. I think that one of the things that I’ll
just say is commentary is that when we look at the big stock exchanges that are choosing
IBM Blockchain and Hyperledger underneath it as opposed to, say, more proprietary things
that have already been built for exchanges, like some of them famously and
they’re…stock exchanges are choosing us, why? We asked them, and they said,
well, because, yes, sure, they built this thing but…and they did
build it…they made their source code open. But they didn’t build it on openly governed
open source and that’s what they want. And so, we’ve been wing deals from major,
major companies and networks and government because we support Hyperledger so faithfully and Hyperledger is an openly
governed Linux Foundation open source. We gave our code away to the Linux Foundation. We don’t control it anymore. Other…so don’t be fooled. There’s open source and there’s
openly governed open source. And people seem to like the latter a lot more. And now, I think I’ll turn
it over to Dale Avery. Dale is a straight-up blockchain
software developer here at IBM. One of the best and, Dale,
you know, you’ve been here. You and the team came up with the Marbles app. You built it in record time. I saw you guys in Vegas, you know, having
to build another application, you know, to put up in commercial paper
trading and I think you guys did the in the hotel room after…with
a ranging hangover, right? Can you show the audience
how the marble app works and how they can use IBM
Bluemix in this case to build it? AVERY: Yes, you got it. Okay. Let me share my screen here. WOLPERT: Sorry about the ranging
hangover thing but it’s true. I saw it. AVERY: Giving away too much. Okay. All right. So, the Marbles application. If you want to follow along or do this
yourself, the website that John mentioned, ibm.com/blockchain has links to all
of our demos that are available. So, you can go ahead and follow
along with this yourself. So, first, you’re going to go to the
GitHub repository for the Marbles demo and you’re just going to click
a deploy to Bluemix button. So, John’s right. It only takes about two minutes
to get the Marbles demo deployed. You’ll see a UI like this one. Just click login. And then you’ll pick the organization
and space on your Bluemix account where you want the demo deployed. But this takes about a minute or so, so
I’ve gone ahead and predeployed a demo. So, after you’ve deployed the demo, you’re going to see the application itself
and a Blockchain service. Now, this is how this demo works. There’s obviously a blockchain network
underneath that makes this magic happen. And there’s an in between
here that you can’t see it. There’s something called a
chaincode or a smart contract and that actually contains the
business logic for this demo. It’s what makes…it’s what makes this
application a blockchain application. Now, this top part is just the Marbles web app. It’s just a pretty interface to the chaincode. So, you open this up. And then you’ll have a URL here that will take
you straight to your instance of the demo. Okay. So, this is the UI you’re going to see. We just have two users in
this demo, Bob and Leroy. And what you can do with this, what we
decided to do with this blockchain network, we wanted the simplest asset transfer
demo that you could possibly have, and we decided why not just trade marbles. So, what I can go ahead and do is
create some assets for the network. Let’s create a few marbles here. Assign one to Bob and then assign one to Leroy. And if I refresh the page here, and you
can see that now I’ve created these assets. And to interact with the demo,
all I need to do is click and drag marbles back and
forth between the users. And as I’m doing that, each of
these transactions is being captured as a block that’s getting stored on the chain. Now, that’s really all this is to this demo. It’s not very complicated. [Blew] it’s just supposed to demonstrate the
functionality of the Hyperledger fabric. It’s a very basic demo. But now I’ll explain the other side of this
demo, and that’s the blockchain network itself. So, from the dashboard, if you click
on the Blockchain service panel, it will take you to this, this UI right here. Just as a side note, on this
page, you’ll be able to see all of the credentials for accessing your network. These are the same credentials that that
web application is using to interact with the network and deploy,
invoke, query, chain code. But the pretty part is right here. So, you can launch your service
dashboard and this is going to show you information about
your blockchain network. Like you can see the peers that are running on
the network here and the certificate authority. The CA is the peer that’s responsible
for managing identity on this network. And you can also see down here, this
is the smart contract with chaincode that is running the Marbles demo. And so if I come over here to the
Blockchain tab, this is just going to give me a summary of my chain. And I can see here in these blocks that
the set user, this payload in the block, this is the transaction that
this block is capturing. And so when I was trading those marbles,
the set user function was being called. And you can see the ID of the marble
and then the name Leroy there. So, this UI just allows you
to investigate your blockchain and see exactly what’s going
on as you use our demos. And once you’re comfortable with the demo
and kind of want to see how you can kind of build something yourself, you come over here
to the API tab and you can see the interface that the web application is using to
interact with the Blockchain network. Like this UI back here, all of
this is captured through a REST API that is available on each of the peers. And it’s actually this API right here. So, this is if you have ever
heard of a Swagger document, this is a Swagger document that’s
been converted into a Swagger UI. Basically, you can take a document that
describes a rest interface and deploy it as an application that users
can click and interact with. So, if you want to call this API, we’ll
say we want to get the value of block six. Go ahead and try it out. You can see the response that
gets returned by the peer. So, this is what I would recommend for new
developers is that they would just come into this tab and experiment
with the rest interface. Like if you want to see how the
demo is deploying, invoking, and querying chaincode, that’s this endpoint. This is the one that we’re using. And you kind of investigate this
and play around with it yourself. Now, the other benefit to this is
that, as I mentioned previously, the demo has the three components, the
blockchain network, the web application, and then the chain code into
middle that makes it all happen. You can use this rest interface to
break up how you develop your demo. Basically you can first build out your
smart contract which captures whatever sort of business logic you’re trying to
run in the blockchain and then test it out using this interface before you
actually start building your web application. Or whatever you…however you decide
to expose this chaincode to users. So, that’s just about it. The other tabs here are just ways for
you to step through, just like I said, testing out the chaincode before
you actually build a web application. You can do that here. Like you can see we have our three example
chaincodes and I can just deploy Marbles and that will take another minute or so. But if at this look here, without
actually having a web interface, I can test out the functionality of this smart
contract before I’ve actually built a UI for it. So, there’s just a lot of
resources available out there. And Marbles isn’t our only demo. We’ve got a whole organization
on GitHub for these things. So, if you go to github.com/ibm-blockchain, there are all kinds of demos
and resources out here. There’s a repository that will help you
learn how to get started with chaincode. All kind of…oh, the documentation for our SDK, there’s really just a lot out
here, a lot of value here. So, that’s what I would recommend is that you
start with our website and then use the links to the demo, try out all the demos, and then
start learning how to write something yourself. And that’s about it. WOLPERT: Thanks, Dale. Hey, I want to throw you a curve ball. We didn’t talk about this beforehand,
but I know you’re fast on your feet. Tell us something that you think
is still challenging about working with this that’s being worked on that where
you can maybe highlight and say to one of the developers I’m meeting, you know, hey,
watch out for this and this is how I would deal with it for now and this is how it’s
going to be better going forward. AVERY: Yes. That’s a good question. Okay. So, the thing you’re going to struggle with
I think at this point, and this is changing, it’s getting better, is software
development kits. So, what resources are available
to you to make it easier to interact with the blockchain network. So, the SDK that is actually
used in the Marbles demo and the commercial paper
demo, it’s being deprecated. It doesn’t have all of the functionality
that has been added to the fabric since we started doing this process. And so there’s a new SDK that’s coming in a
release soon from the network that’s going to have a lot more functionality. One of the big ones is the ability to create
and register new users on the network. Currently, we use a separate library
from the SDK to do that in our demos, and Marbles doesn’t actually do that. Commercial paper does, so you can see
an example of how that works there. But the new SDK, you won’t have to
worry about having multiple libraries, that will all just be all in one package. So, that would be the big one is
what resources are [INAUDIBLE]. WOLPERT: Right on. I’ll give another one more on the,
you know, what did you do with this from a business perspective side. You know, right now, you can stand
up a…you know, a small network. Soon you’ll be able to stand
up a slightly bigger network that will start testing security,
privacy, confidential contracts. And then you’ll be able to do it on
a really highly secure environment if you’re dealing with…if you’re a
company or a startup that’s dealing with say grandma’s pension or a
healthcare data, you’re going to want even in a testing environment for that to be highly
secure in terms of what kind of cloud nodes or cloud environments are
actually running your nodes. So, those are things that are coming. And then ultimately, you know, one of the things
that we think is going to be pretty cool is when you can list your network on an identity
service and let people join just almost like a web browser…like a domain name and
let companies join so now you’re node zero and there’s 500 other nodes
that are joining your network. That means that we have to enable
the system to have 500 nodes and PVFT if anybody’s a comp side person probably knows
that, you know, that’s an n-squared problem. How can it get that kind of scale on a PVFT? We’ve got some tricks up our sleeves and how
cool would it be to be able to work with IBM and others to grow your network and make some
money as every time a node joins your network? So, that’s…those are the
kinds of things that are coming. Louis, keep us honest. I think we’re…do we get some Q and A here? LOUIS: If we can wrap it up. WOLPERT: Okay. All right. So, thanks, Meeta, Zak, Dale
and the online participants. There’s a survey monkey and the link is on the
IBM systems log to tell us more about what you’d like to develop using blockchain. It takes two minutes. And with that, I think we’re good to go. Thanks everyone for your time and get out
there, start building some business networks. Cheers, everyone.

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