Radix Q4 2019 Update
In the last two years we have worked with everyone from startups to banks to space-agencies to governments; helping them understand how to build and deploy scalable Decentralised Ledger Technology (DLT). For many applications, Radix is the only truly scalable choice. This work has sat right at the core of what we do – helping anyone to build at the scale of nations.
The learning from this process has been invaluable. It also helped us develop the Radix Engine, something that will grow to become one of the most important pieces of technology we create; not just because of the innovations within it, but because it makes DLT truly accessible.
Ultimately, we are not trying to win a battle, but a war. The current playing field seems to be characterised by a competition that we think misses the core issue: solving problems for people. This is a war for more than just the crypto community – the revolution isn’t over until entire countries are using our technology.
Radix will no longer be launching a public network in 2019. Although this decision was initially due to a technical setback, it also – crucially – allowed us time to carefully consider our route to market, and realign around the core of what we are trying to achieve here: tech that is both usable and used.
This article will cover what we think is the critical path to getting as close to the customer as possible, as well as how to truly drive adoption of DLT networks. The details of the technical setback, the full resolution, and how it has made our entire technology stack stronger, will be covered in a future post.
“Make something people want.” – Paul Graham, YCombinator
We are in an unusual industry that looks at every problem through the lens of technology first, user second. The majority of problems discussed are technology problems, be that scalability, or composability, or creating the perfect byzantine fault tolerant algorithm. To date, Radix has been no exception to this technology bias.
“…markets should only tolerate inflation if there’s a credible expectation that a fee market will develop to subsume it” – Chris Burniske, Placeholder Ventures
We are about to see a massive amount of excess capacity come online as the next generation of “Ethereum Killers” (EK) launch. With multi-billion dollar valuations, all of these teams are already scrambling for one thing above all else: applications that drive transactions on their network. Without transactions to soak up fees and create token demand, the inflation on these networks may be enough on their own to systematically destroy the value of their floated tokens.
“Sometimes the right unscalable trick is to focus on a deliberately narrow market. It’s like keeping a fire contained at first to get it really hot before adding more logs.” – Paul Graham, YCombinator.
The risk here is that none of these teams will ever have the chance to stop and do unscalable things. They already have hundreds of millions of dollars to spend to fight each other for “users”, without knowing what those users should be using the network for. In the short term, paying for users will work. Long term, if those users don’t understand why they should be using the technology, they will stop once the subsidy ceases. Paying for users is only effective as a sustainable growth strategy once you have product market fit. No protocol in the DLT industry (apart from Bitcoin) has this yet.
“…you have reached product/market fit when you are overwhelmed with usage—usually to the point where you can’t even make major changes to your product because you are swamped just keeping it up and running.” – Michael Seibel, YCombinator
In the two years since joining Radix, I am hugely proud of the team that we have built around this phenomenal technology. The sheer amount of experimentation, engineering and technology validation that has been done by a team of our size has been incredible, and it has put us in a very strong position to start validating what we have built.
This year, Radix was on the very edge of launching a public, permissionless network, and entering into the public network user battle with the other EKs. Most blockchain projects have taken this public-network-first approach, despite the fact that the majority of companies that want to build on DLT want to start with private deployments to control their risks with a new and unfamiliar technology. The reason that companies want to start with private deployments first, then migrate to public networks is simple: launching on a public network is a little like trying to learn to play American Football by immediately playing in the Superbowl; it looks attractive, but for someone who has never played, it is likely to be a painful, short-lived experience.
For the last year, the Radix team has been helping our partners and developer community both build and deploy in private environments. This has a great opportunity to test the Radix development tools and get early feedback. What has become clear is that private deployments are not just a side component, but lay at the heart of getting our public network adopted – nothing exists in a vacuum, the importance is not just the technology, but how that technology integrates with a businesses’ core services. While some of those work fantastically on a public ledger, many make no sense being there.
Fortunately, Radix is not just an incredible ledger, but a development framework that can also be game-changing for building and deploying distributed transactional systems. One type of transactional system is a public, permissionless ledger, but that is the beauty of Radix; it can be used for way more than just a public network, and therefore can be released and used to solve real problems for any transactional business.
Over the last two years we have modularised all parts of the Radix stack, separating the ledger from the execution environment, and the execution environment from the libraries and SDKs. This gives us the flexibility to:
- Release Radix technology module by module
- Pursue application utility, wherever it can be delivered
- Focus on successful outcomes for the end user
This approach has nothing to do with making money in the short term – the prize is far bigger than that: making a network that people want to use. We will continue to use private deployments to learn first-hand what people NEED so that they can build real businesses using Radix technology. The solution MUST be user first, technology second.
Fundamentally, my long term view is unshifted – we are building a single, global network that stitches together businesses and people around the world via a single interface for value.
A network of this scope should ultimately only be a permissionless, decentralised network. The goal is to deliver a resilient, decentralised, and useful digital commons that the world can rely on. We are fully committed to building this; without the public network component, private networks only enable back-end system optimisation. A public network is the fundamental difference between “just” a technology, and a movement that aims to change the way the world works, not just make it run more efficiently.
However, it is a long road to get people to adopt DLT technology and put it at the centre of their business, and a public network is not where most people start. We first have to understand how to win hearts and minds before we can push companies to truly adopt permissionless public ledger technology. The Radix advantage here is we can truly do both.
“It doesn’t matter if a cat is black or white; as long as it catches mice, it’s a good cat.” – Deng Xiaoping, Paramount Leader of the Chinese Communist Party, 1978 – 1992.
Deng Xiaoping marked a turning point for China and the Chinese Economy – a shift in thinking that for the country to thrive, outcomes were more important than ideology. This created the necessary environment for the loosening of China’s policy on private enterprise. Within two decades, China moved from one of the poorest countries in the world to the world’s second largest economy, setting a record for pulling more people out of poverty faster than any other country in human history.
For DLT to be taken seriously (and be more than a joke about the price of Bitcoin in mainstream circles), we also need to review the outcomes we are trying to achieve, rather than the ideology. DLT has the potential to be the most important invention since the birth of the internet, but that importance is not limited to decentralised utopias.
As utility, not ideology, is the true long term driver of technology adoption, it is necessary to slay some sacred cows: not everything needs to be tokenised, sometimes intermediaries provide important functions, and sometimes good application design means not everything should be decentralised.
That does not mean there is no place for ideology – ideology serves as a guiding light towards a goal, it gathers people around an idea before anything else exists, and it creates international movements that change the world. This piece is not advocating that we sacrifice the future we want to achieve, but that getting there cannot be achieved without enabling people to use the technology however, and wherever, it is useful to them. The terms public/private/decentralised/distributed/centralised/permissionless/permissioned should be tools – not judgements – used to achieve the long term goal of stitching everyone together in a single, global network.
Over the next few months we will be sharing more details about the staged (and separate) launches of the permissioned and permissionless versions of Radix. They will both be open source, open platforms for building the next generation of transactional systems for the world that converge on one, unified system.
The Tempo 2.0 Whitepaper is our next major milestone. It will outline our up-to-date thinking on consensus for both public and private environments. Following this, we will release the Governance Whitepaper, describing the way we plan to establish open governance of the public Radix network once it is launched. Lastly, we will release the Economic Whitepaper, which will tie together both consensus and governance.
We will also release and open source our first major technology module: the Radix Engine. The Engine provides breakthrough DLT buildability with its approach to secure transactional system development for both private and public networks. The Radix Engine’s design directly enables the use of massively sharded ledgers; but uniquely, it does not force developers to learn any new languages or new ways of coding. It is designed to be secure, scalable and easy to use. We expect this to solve one of the primary barriers to DLT usage in deployable applications, creating a tipping point in adoption.
The Radix Engine is an important part of our arsenal, aimed at driving product-market fit for the Radix platform. It is our first step on the road to driving customer centric results on top of DLT technology, and we are really looking forward to sharing it with you!
By Radix DLT