Your Horizon, Our Journey

This is part one of a two-part series.  In this issue, we cover the journey from Blockchain to Crypto to DLT (Distributed Ledger Technology).  We will review why blockchain matters, where we are now, and what future may hold. In the next issue, we will review the current DLT architectures, who the main players are, and most importantly what this all means to you, your customers, and your business.

I am hoping you are reading this online, or otherwise are near a connected device.  You will see references to “Search” throughout this article, along with references to a site or keywords.  You are encouraged to pause from time to time, do some online checks, and come back here.

You already know about the rapid rise and recent volatility of Bitcoin & other like-Cryptos.  “Satoshi Nakamoto’s” White Paper is online, and there are many articles online you can search for and review (for a quick introduction, Search blockchain after locating 3Blue1Brown on YouTube), to learn the bits & bytes on blockchain.  I’ve also covered technical details at my Blockchain virtual lab presentations before.  You should be able to find them online.  Write me if needed.


Some basics:

    • Blockchain is the technology behind Crypto currencies and ICOs (Initial Coin Offerings).
    • Blockchain is a chain of digital blocks, each linked to the one before.  Each block represents a set of completed transactions.  Blocks & content within them are immutable.
    • Pure Blockchain implementations require Miners who verify the validity of a block’s content before its introduction to the chain.  They use simple & publicly available cryptographic algorithms (Search SHA256) to obtain their “proof of work”.
    • Blockchain is based on borderless & public consensus among active nodes (open to anyone), who verify the Miners’ “proof of work”.  This allows for the Block’s acceptance & entry into the chain.  All nodes participating in consensus have a full ledger of all transactions (chain) since the birth of the first block of that chain.
    • Distributed Ledger Technology (DLT) is a variation of Blockchain, where access to ledger (full or partial) is open only to members of its consortium. Depending on the implementation, consensus may come from all members, or by those with a need-to-know (e.g. parties to the transaction), or a trusted party such as a Notary (R3 Corda), or a Validator (Ripple).  There are no Miners in DLT.

There are more details behind each of the above line items which you can find online.  Various implementations of blockchain are on GitHub. You can download the code to use, or even create your own fork.

Here instead, let us focus on possible use cases, and why it is hailed at the next internet.  You need to know the immense effect it may have on businesses and long established worldwide socioeconomic structures.


There are different schools of thought on why blockchain matters:

    • It promotes Democracy – Brock Pierce is the Chairman of bitcoin foundation, an early adopter of Crypto, serial entrepreneur, and… (Search his name).  At 37, he is worth more than everyone alive in my family tree, combined!  Go to one his presentations (next one is in March 2018 in Puerto Rico – Sorry, sold out), and he will most likely play Charlie Chaplin’s The Great Dictator Speech (it’s on YouTube), and talk about peace, love, and harmony which are now possible, thanks to Blockchain technology.  The message is that people around the planet can establish global and direct commerce, promoting personal freedom & choice.  Simple, since, and this is already forming, a new economy which bypasses regional and national governments, opens direct one-to-one trade & new commerce opportunities. Elon Musk’s upcoming network of 12,000 internet satellites will pave the global highway in the cloud; call it the blockchain SilkRoad.  Brock and a network of his friends are buying up 250,000 acres of land in Puerto Rico (where there is no federal income tax) to setup their own CryptoWorld City (Search Crypto Utopia).  For the record, Brock is not the only one; nearly everyone I’ve talked to, is of the same belief that direct global commerce, which bypasses the middlemen and, in most cases, government regulations, is the way to go.  In my opinion, in many instances, it is ideal and can benefit the mankind.  However, and as we review later in this article, it may also lead to some major and most likely disruptive & unpleasant events.
    • It’s about Time and Money – Open slide sets of most Blockchain presentations.  There is diagram after diagram showing the flow of money from one person to another (Alice and Bob are usually the main characters), and how the transaction is weaved through several private (banks, exchanges, credit card companies) and public (SWIFT, ACH) agencies before completion.  Argument is, and it is a valid one, that each party needs to collect a fee adding to the total transaction cost, and requires time to do whatever it does, which adds to the total transaction time. This in fact is a very convenient and lucrative arrangement for all the middle parties involved in the transaction (at the expense of Alice & Bob).  Interesting to note, is that most of investment in defining & implementing blockchain (actually DLT) use cases are coming from the same middlemen / companies.  I suppose it is a recognition of the inevitable, and an attempt to join in and ride the blockchain wave.  I agree with them; the alternative will not be pleasant. Search for “Threat of Cryptocurrencies” on (mind the ads).
    • It improves Productivity & lowers cost – Yes, absolutely.  At the advent of commercial computing, every company which bought an early generation computer developed its own applications for their own use cases.  We called them in-house applications.  Later, software vendors developed and marketed more generic forms of application software for different use cases.  This was a game changer. A company could now simply employ a solution at a far lower cost, compared to in-house development (This reminds me.  Remember Y2K when we could not find the source code for programs decades in production-use).  Of course, there were multiple vendors offering similar apps.  Each business purchased and deployed the app which closely matched their requirements and price point.  This is how Software Silos were created.  Finance, Retail, Manufacturing, and others, all ended up with a hodgepodge of software which could not communicate with software at other companies in the same trade.  Enter middlemen.  For a fee, they would take a transaction, do the protocol translation, insure the content (nearly all companies signed up for this service, and of course passed on the fee to Alice & Bob), and take it to its destination.  Of course, one middleman will not do.  More parties got involved, adding more fees and time.  Search “Credit card transaction flow”.  Blockchain can fix this. Objectives: Efficiency, direct point-to-point transactions, lower costs.
    • Blockchain also offers Smart Contracts.  These are pieces of code that are common across the consortium.  No more translation, no more Software Silos.  What makes them smart? A contract can incorporate, enforce, and log (ok, add to the chain), all steps of a complex transaction.  My (and many others’) favorite example: buying a house.  It represents what happens from the time a buyer makes an offer, to counter offers / acceptance, to appraisal, inspections, removal of contingencies, funding, mutual close, titles, and many other steps along the way.  A Smart Contract on the chain implements all these steps in one immutable chain of transactions, and can enforce or reject any step based on any number of factors, such as time (deadlines), authorization (signature of parties involved), proof of funds, … That transaction in its entirety is there for the eternity, where each step is fully recorded.  All participants in that Consortium (think a group of Brokers, Banks, Notaries, etc.) will use the same Smart Contract for all like transactions (one application for all, and a smart one at that).  Improved productivity: Easy to follow, implement, and record one transaction set, compared to mountains of papers which would otherwise need to be passed along different parties. Lower cost due to improved productivity and the fact that there are no Software Silos.  One use case, one App.  BTW, what if you wanted to buy your house using Bitcoin?  It’s already being done (Search “Real State Bitcoin”).
    • Better to be a Disruptor than a Disruptee (word not in dictionary, yet).  How many of you ride your horse to work?  Modern (really?) automobile was invented in 1886 (Carl Benz, Germany), and in very short order, ponies & their handlers were disrupted. How many of you still carry paper currency in your pocket (please don’t read further if you carry coins)?  Fiat currency goes back to 11th Century (Yuan dynasty, China).  Isn’t it about time?  We’ll cover later as to why that is still so.  But currency is just one use-case.  Nearly everything we do today, can be done cheaper and faster with Blockchain, especially if computers and middle men are involved (ok, everything).  Search “Blockchain Future Thinkers” and within it, Search “Blockchain” on  Unfortunately, and this may apply to you: just adopting the blockchain technology may not be enough.  In some cases, blockchain allows for a new way of conducting business that completely bypasses established methods.  Horse of a different color won’t do.


Where we are today

Early stages & noted issues
Speed & Scale: To start, Bitcoin network was able to only do 7 TPS, and Ethereum 15.  Forks of the same protocols offered larger blocks, and significantly improved throughput.  Ripple ( started with 1,000 TPS and is already exceeding its goals.  Stella ( does over 1 billion transactions per day.  In 2017, Red Belly blockchain ( network in a worldwide test-run did 660,000 TPS. Not an issue anymore.

Lost wallets / Stolen coins – Does this not happen to thousands of people in Fiat currency world every day?  It becomes news when it is Crypto.  1.3 million people die in car crashes every year.  Commercial air travel casualties in 2017: zero.  Yet, every time there is a crash it will make the news nearly everywhere for days.  Crypto coin owners decide whether to keep their wallets on their own devices or trusted it with an Exchange.  They can also do both, where multiple wallets are kept, and coins can be transferred and distributed as needed.  Crypto wallets are safer than currency wallets.

Security, anonymity & Fraud: Security It is inherent in the blockchain architecture.  Users are anonymous (public key is known but no link to user), but not to government agencies when needed (Search “Kathryn Hahn” on YouTube for her Tedx talk).  Can it become a cover to launder money? KYC and AML checks are already in place at main Exchanges.  I suppose there are exceptions. However, by far, Blockchain offers a superior trace of transaction activity back to its source.  Imagine knowing where your currency bill has been for every second of every day, since it was first printed.  Blockchain can tell you in an instant.  Compare that to the serial number on your currency note.  What valuable information can it give you or anyone else?  Case closed.

Pillars of our societies:

Banking. Currencies. Governments.
Banking began around 2000 BC in Assyria & Babylonia (source Wikipedia).  Now, some 4,000 years later, there are an estimated 20,000 financial institutions on our planet.  There are 195 countries, using 180 currencies. Now Search “WorldDebtClock”.  Go there. Stay a while & click away.  Take your time. Focus and think.  Financial health of a nation is of immense importance.  In the world of Fiat currencies, trust is placed in governments and their balance sheets.  After visiting this site, do you feel your trust is earned?  Do you look at the currency in your pocket & your bank balance, the same way you did before?

Crypto’s first currency, Bitcoin, came to be in 2009.  Less than 10 years later, there are about 1,500 crypto Coins with a $500 Billion USD cap (Search “Coinmarketcap”), traded through 8,700+ markets (exchanges), dispersed around the world, and mostly unregulated. You can argue that Crypto came to make the direct global commerce possible, to create an alternative to Fiat currencies, and perhaps to put governments to task.  One thing is certain; the dust has not yet settled.  Daily fluctuations are finding their limits.  Consider a bouncing ball that will eventually come to rest and starts rolling in a direction yet unknown.

This is an excerpt from Bank of England filing (Search “a blueprint for a new RTGS service for the United Kingdom”) in May 2017: This is not me; it’s Bank of England, one of the most conservative & largest global banking centers. IMF managing director, Christine Lagarde, at Davos 2018: “I think we are about to see massive disruptions”. She further commented that government regulation of Cryptocurrencies is inevitable: “It is clearly a domain where we need international regulation and proper supervision.” Exactly how that is possible remains to be seen.   IMF is considering creating its own Crypto / Digital currency.  Estonia tried to issue one and was stopped by Mario Draghi (European Central Bank president), in favor of Euro and perhaps a unified European digital currency.   Several other countries are taking independent moves towards crypto to meet their own policy requirements.  Point is this:  Crypto in one form or another is here to stay.  Its effect can be, and I use Ms. Lagarde’s word: massive.  Governments need to come together, and devise policies which hold the populous whole, and use technology to benefit all.  Stage of Georgia in U.S. is considering receiving bitcoin for tax payment, creating yet another use case.  The day may come when Alice uses Crypto through Binex (a leading crypto exchange in Asia) to pay Bob for her cup of coffee.  Should that happen, and it is possible & likely, we will be living on a different planet.


Want to start a company?

Bank of England, May 2017:
“The world of payments is changing rapidly.  Households, companies and individual intermediaries are demanding faster, simpler, cheaper and more flexible ways to pay.  In response, new technologies are being developed, some by existing market participants, and some by new service providers, to meet these needs.  At the same time, these technologies, and broader developments can create new treats to users of the payments system, and to the stability of that system, which require ever stronger protections and more resilient infrastructure.  Balancing the need to safeguard stability whilst enabling innovation is the challenge facing everyone involved in providing payment services.”


Traditional methods may involve the following steps:

    1. Ask grandparents for initial funds.
    2. Form a professional business plan, or if possible start your business offering a product or service.  Show promise.
    3. Look for Angel investors.
    4. Attract Series A investors.
    5. Once or more, look for Series B funding.
    6. Still there (less than 3% reach this step)? Continue your business, hoping to survive, and some day issue an IPO (Initial Public Offering) on one of the main exchanges.  This last step can be quite expensive due to SEC regulations and liability costs.

Here is a better idea:  Develop a PowerPoint presentation of less than 10 slides; use the word Blockchain in 3 or more places.  Create a “team” of “trusted” people in the blockchain industry.  Give no more than 5 presentations in the investment communities worldwide (There is one every month in Santa Monica, you can listen to three 10-minute presentations.  It’s on meetup.  Join us.).  Now fork the code off git and create an ICO (Initial Coin Offering).  Go to market.  Offer discount to early birds and set (extend if necessary) your public offering date.  Receive Ethereum for your Coins & convert to Fiat of currency of your choice.   You are in business, along with the other 1,500 who came to existence in the past 3 years.  Did we mention?  Your offerings are not regulated by SEC in the U.S. or any other major government entity elsewhere.  Your ICO is most likely registered in an Island some place remote, more open to the “new pace of innovation”.

While this has opened doors to many legitimate entrepreneurs, it has also facilitated for shadowy figures to walk away with investments from unsuspecting investors worldwide.  Search for eye opening information and stats.  Remember, most businesses here are trying to disrupt an established business model.  Is your business in their sight?


Internet of Things & IOTA.

Smart Cities.
No need to explain IOT here; my guess is you’ve sat through multiple presentations and have read many articles on the topic.  It’s blockchain that brings a new dimension here.  There are over 17 billion active sensors around the planet (world population today: 7.6 billion) collecting, recording, and emitting data about their surroundings.  Blockchain can bring authentication, connectivity, and scaled security to these silos of data, at low cost.  Use SpaceX’s Internet satellites to securely transmit data from anywhere to Super Computers (cloud or otherwise) which can compile the massive data, and use A.I. for immediate action (e.g. emergencies, asking Amazon to deliver milk on Tuesday), or future planning.  This data on blockchain offers a full record of nearly everything everywhere which gives info on trends, exceptions, and interconnectivity of events.

This is exactly what could be most useful or harmful to us, depending on who uses the data and for what purpose.  I am optimistic.  Smart Cities are an example of IOT and Blockchain benefiting citizens.  Middle East (UAE specifically), and Asia (Singapore & China are good examples) are leading the way.  Perhaps a review of their progress and goals could be covered in another article.

IOTA is just one blockchain implementation, hoping to “enable companies to explore new b2b models by making every technological resource a potential service to be traded on an open market in real time, with no fees (Search  The “no fees” comment makes me skeptical. Microsoft is considering this technology.


HealthCare. Insurance.
Music & all digital content.
Supply management.
Quality & source control. & …

These are but a few other blockchain use cases.  It is applicable anywhere data matters, meaning everywhere.   For more info on anything do a Search on “blockchain” + its name (e.g. Blockchain Healthcare) Blockchain is rapidly bringing changes to our societies.  We all understand its potential for saving time and money at our businesses.  It can help us offer more to our customers at lower cost, and in many cases open new lines of business.

One thing that we must not overlook is its potential disruptive force, especially in the world of finance (Search “Goldman Sachs crypto”).  Again from “Cryptocurrency is a revolutionary force for a reason that people often miss: it enables people to print and distribute money without a central authority.”.  Here, we made several references to how this is already happening, and the profound changes it can bring.

We will continue this topic in the next issue, where we focus on DLT and its use cases for Enterprise.  You will learn about popular architectures & protocols, where they are most useful.  Objective is to help you become familiar with the current technology landscape and assist you in setting your forward path.

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