Time:10:00 PM (Beijing Time) ,September 20 10:00 AM(ET) /7:00AM（PST),September 20
Groups: Mars Finance
Sunny King: The inventor of the PoS consensus mechanism, whom Vitalik Buterin called "the single most original digital currency developer"，the inventors of Primecoin and Peercoin.
Fred Wang: Founder of Mars Finance, chairman of Linekong (HK. 8267), and founder of Consensus Lab, the founding partner of Geek Founders
Fred Wang: Hi，Good evening everyone，welcome to the 25th episode of Ten Questions with Fred Wang.
Let me introduce our Mystery Guest tonight, the creator of PoS consensus mechanism, Sunny King. About his public photos, I can only find this one. But unlike Satoshi Nakamoto, I am sure he does exist. For instance, he came to today's "Ten questions with Fred Wang".
First, let’stake a look at Sunny’s personal experience. In 2011, he established a bitcoinresearch team with a focus on alternative bitcoin technology; In 2012, he came up with the concept of PoS for the first time and released Peercoin, the first crypto currency whose consensus algorithm was achieved by PoS mechanism; in2013, he launched a second crypto product——Primecoinin the hope of identifying prime chain consisting of large quantities of primes by computation. In 2014, Primecoin reached the third place in the world on the basis of market cap, second only to Bitcoin and Litecoin. In late 2016, Sunny King updated blogs in the Bitcoin Forum for the last time before disappearing.After being off the radar for one year, Sunny King announced the blockchain development platform——VEE On January, 24, 2018, in which he acted as its founder and chief architect.
As a senior developer in the world of crypto currency, Sunny King , like Satoshi himself,is another mysterious and influential person behind his mask. It’s been nearly two years since your last disappearance. Now Sunny are back, which excited many people, since a lot of my friends from investment and media industry are looking for him.
Consensus mechanism is like the soul of blockchain and plays the role of laws in acountry to keep the system functional. The PoS Sunny created has become one of the most popular consensus mechanisms in the blockchain community and still has a profound influence on the whole industry.
It’s an honor to have Sunny King with us. We’ve never met before, so this is the first time weinteract and communicate online with each other. I expect our dialogue will show a more real version of Sunny and Let more people know about him behind the mysterious mask.
Now, let’s get started.
Fred Wang: In the field of Blockchain,you are famous for being called the creator of POS, the Prove of Stake which was first brought forward by you in 2012 and made its debut through the Peercoin program, causing wide attention in the industry. An editor with the Bitcoin Magazine called you the only digital currency developer with the most original spirit. This editor was Vitalik Buterin, the young founder of Ethereum the white paper ofwhich was published one year later.
Six years later, blockchain professionals now have commanded a general knowledge of PoS. On Ten Questions with Fred Wang today，would you mind explaining the mechanism of PoS in a simpler way for us? Satoshi Nakamoto opened a world of distributed ledger, while But erin branched off and grew blockchain through smart contracts. As far as I am concerned, you are the designer of the rules applied to Blockchain space. Seeing PoW being defective made you sought reform or revolution. So, what inspired you to come up with the PoS mechanism?
the only digital currency developer with the most original spirit
Sunny King: In easy to understand terms, a distributed consensus system needs to have a reliable mechanism to determine how much weight to give to acertain participant for the decision making power. The naive way is to give everyone equal weight, like in a democratic election, but once you consider an open system and the anonymous nature on the Internet, such system can be easily sabotaged through the faking of a lot of identities. This resembles counterfeiting, which is unfair to all the other honest participants.
PoW Consensus was the first system to give a reliable measure, so one’s weight is proportional to a certain computation one did. This certain computation can be verified and measured easily by everyone, thus called ‘provable work’, in that you can easily prove to everyone else how much the work was. The computation can also practically scale to take arbitrarily large amount of computation.
In comparison, PoS Consensus advocates using a value token inside the system as the proportional measure of weight assigned to a participant’s decision making power. So the amount of the token owned, called stake, proves to everyone else one’s serious contribution. The token cannot be created arbitrarily or with shortcut, once the system begins operation. The creation of the token must also follow a pre-set rules called protocol just like how Bitcoin protocol regulates the creation of bitcoin.
Compared with PoW, the other popular consensus mechanism, PoS shortens the time needed to reach a consensus, also lessens energy consumed to mine and increases the difficulty to conduct a 51% attack. However, PoS also has its own problems. For example, in a PoS-based blockchain system, double-spending becomes easier. Initial coin owners may cause obstacles for later participants, and in some extreme cases,wealth gap and over-centralization may occur.
Fred Wang: On one hand, there is no doubt that both PoS and PoW have become the foundation of consensus mechanismsin the field of blockchain. On the other hand, the argument over which one is superior is constant, and I don’t know if there was any conclusion drawn. This reminds me of a phrase by Churchill, “Democracy is the worst form of government, except for all the others.” From the dialectical perspective,existence is reasonable and difference is existence. Could you please tell us your trade-offs when designing thePoS mechanism?
PoW vs PoS
So far, every consensus mechanism can be traced from the governance system of existing human society.For instance, PoW can be understood as law of distribution according to work in a socialist system, while PoS is more like equity governance found in capitalism society. From the endless consensus mechanisms originated from PoW and PoS, we can see the reflections of our current government systems in the real world,such as the Parliamentary system in Great Britain, the Federation system in the US, the Confederationin EU and China’s NPC system. How do you explain this phenomenon?
Sunny King: Very deep observation. I believe this is a possible reflection that human civilization will be projected into the future virtual economy. All the political systems you mentioned, we used to call them ideologies. The past century we have seen huge struggles between different ideologies, we seem to lack the ability to cooperate more reasonably andpeacefully in this type of ideology competition. So let’s hope for the bright side that the future virtual world may provide a more peaceful and fair playground.
Fred Wang: It’s almost certain that every type of government has flaws. For thousands of years,we have made great progress in terms of technology and engineering, but when it comes to creating rules and regulations, our innovative effort could only seen in the virtual internet games community management. Some people say the wisdom of mankind has not made much progress, do you agree with this point of view?
Sunny King: Answer: Indeed, it may seem so, especially for the Chinese, the ancient wisdom and work still amazes and perplexes the world. But we did make some progress, we have a less costly and violent path to explore now. From the virtual economy point of view, everything is orders of magnitude easier to built, and experiment, not just the cities and cultures, but also the governance systems or political systems.
Fred Wang: According to the data from the Analysis Report of Global Major Public Chain Projects by Stamp Capital, by the end of July 2018, among global Top 50 public chain projects based on their market value,25% use DPos, for example EOS and QTUMl; Projects that adopt PoW and PoS account for 18.75% each, tied as second place, their respective representatives are Ethereum and ADA. DPoS, PoW and PoS account for an accumulative of more than 60%, representing three major consensus mechanisms in the current market.Besides, other mechanisms such as DBFT、PBFT、VBFT、LFT、PoW and PoS hybrids are also coming to scene.The current scenario can be described as “a contention of hundreds of competitors.” What do you think of this current situation?
Sunny King: Fair competition is probably what gives the free market its vitality. So of course I would advocate more competition and possibilities. For algorithms it is also good, that’s how technology moves forward. It used to be that many people wish a single dominant system to be all end all, but I guess it is now more apparent that it is not going to.
Fred Wang: PoS brings profound influence on the development of Consensus mechanism since its emergence, a lot of derivatives have been developed,of which the DPoS is a typical example. DPoS (Delegated Proof of Stake)indicates that every owner can vote to generate a quantity of representatives or a quantity of nodes and mining pools, and each of them share the same rights.
For example, if we use China’s NPC system to understand DPoS’s consensus mechanism, we will find that representatives will be removed when they can no longer honor their responsibilities and the network will vote for new delegates to replace them. In your opinion, is DPoS an improved version of PoS or the other way around? If someone proposed DPoS instead of PoS when you designed the Peercoin, would you support it?
Sunny King: From our point of view it’s a natual evolution of the technology. It used to be called ‘cold minting’,so it’s been discussed and explored since Peercoin’s very early days. There aremajor differences between PoS and DPoS, but the main gist is still PoS, thatstake amount determines the weight of the decision making power. So I don’tknow if it’s accurate to compare it with the NPC of China, which is more like ademocracy, rather it’s more like company governance, that shareholders (stakeholders) can vote out the executives (minter).
There are stillpros and cons. But for a performance oriented system I would favor SPoS, whichcan be regarded as our version of DPoS.
Fred Wang: EOS, a typical program that goes with DPoS, is hoped to become a representative of Public Chain 3.0 following Bitcoin and Ethereum. However, the present development suggest otherwise. How do you think of the future for EOS? The coincidence has it that both of you and BM have three prior experiences with startups. Your startups include Peercoin，Primecoin and VEE which we will talk about later, while BM’s startups include Bit Share, Steemit and EOS. Do you think you and he are the same kind of person?
Sunny King: I had known BM since his Bit Share days, but did not have much opportunity to interact with him. His three projects all have very interesting goals, so obviously he is probably among the most capable and original designers of cryptos.
Fred Wang: Back in 2013 when Vitalik Buterin was still the chief editor with Bitcoin Magazine, he spoke with you and gave you very high remarks by calling you “the originator of altcoins”. Buterin revealed that he is a fan of primecoin and it is an inspiration for him. However,why didn’t he choose PoS as the consensus algorism of Ethereum?
Sunny King: In 2013, Peercoin’s PoS technology is still not well understood. It’s more complex to master than Bitcoin’s technology, and less agreed upon, that’s some of the reasons I can think of. It’s also said that Vitalik favored Primecoin Consensus. But it’s understandable that it’s probably a project group decision of what to use.
Fred Wang: Media reports that couple of days ago, in an Ethereum Developers Conference, Vitalik Buterin announced that Ethereum 2.0 will adopt a new consensus mechanism Casper in 2019. People who are familiar with the history of Ethereum would know that there are four stages in the development of Ethereum, the first three of which use PoW while the last will choose PoS called “Casper”, adding punishment mechanism and choosing validator from billing nodes.
Buterin twitted,“in my opinion, I intend to favor PoS hybrid，which indicates that blocks are mined through PoW, but the final verification is done through PoS.”He twitted 70 times about Casper in the past month. If I say Casper is equivalent to Casper PoS, would you agree with me?
Vitalik twitted 75 times
Sunny King: Yeah I am always happy to see Vitalik talking about PoS, it’s like the good old days in 2013. It’s amazing what he did since then.
Fred Wang: ETH price has been constantly falling since the beginning of this year. From its peak at $1506， the second largest crypto currency has plummeted by 85.4% , closed at $220 on September 16th. What do you think are the reasons for these major falls of ETH? With its market trend and the new threats from new generation of public chain, do you think Ethereum can still hold its dominant position in this field?
Sunny King: It’s part of the crypto experience haha. My first introduction to Bitcoin in 2011 takes me from a $40 high to $2 low. So as a developer it’s normal. The market has its own set of laws, I am not a specialist in that. I can only try my best to see farther into the long term future.
Fred Wang: Let’s talk about the first crypto currency you developed based on PoS——Peercoin(PPC). I noticed that Peercoin use PoW to mine and distribute currencies to guarantee fairness. In its later process, PoS come into make owning 51% of currency harder, thus preventing 51% attack and keeping the network run safely. Such a delicate design was truly a milestone in the field of blockchain.
Since its emergence, Peercoin is ranked between the third place and the fourth place for consecutive years in terms of market value, which made it a popular product and attract a number of followers. However, as of 13, Sep, it had slipped to the 131 place with exchange volume shrinking significantly, and a lot of exchanges has removed it from their listing. What happened to the once-glorious program? Have you ever made a review? Some internet users repealed that the biggest problem of Peercoin is that its original miners made great profits which lead people to suspect the presence of pre-mining fall outs.Is that true? Will you please make a formal reply to these questions?
Sunny King: That’s of course very wrong rumor. Peercoin was among the most ethically released crypto in2012. It was preannounced a week in advance at least, and the mining was compatible to Bitcoin, so everyone interested in participating in its mining had the opportunity to join in from the beginning.
Peercoin chose to keep the PoW component to distribute coins fairly, even though it could go to a more stock-like issuance model known as ICO later on. As to block minting amount, it’s a smooth curve designed to lower inflation rate, just like Bitcoin also lowers inflation by halving it every four years. In the early years of Peercoin’s success certain crypto fans resorted to smear campaign against Peercoin’s reputation due to their insecurity, this was probably a left over effect from that period.
It’s a misunderstanding that Peercoin was ‘initially’ PoW, then PoS. Peercoin’s consensus was pure PoS in the beginning, designed for its first day. PoW was kept so the issuance can be as fair as possible to the public, just like Bitcoin if not better. Peercoin’s fall has more to do with the competition landscape of the crypto world. It was run as a loosely organized community project, with no backing of investment. So it lacked resources to do further development, not to mention any marketing.
Fred Wang: Later on July 2013,you and your team developed Primecoin, a crypto currency which provides security through searching primes. The presence of primes and its distributing laws are considered weird phenomenon in the field of traditional Math’s number theory. Goldbach conjecture and Riemann hypothesis are all too difficult to be resolved today. What makes you choose the concept of primes when designing a crypto currency?
Sunny King: Primecoin was actually my own creation, not a team effort. I know back in 2013 people had great deal of doubts in PoS, so I was wondering if there could be an alternative, still doing PoW and consuming energy, but with more meaningful computation? Prime number is a natural target of consideration due to its longstanding prominence in mathematics. In fact prime number is prep work for cryptography. If you don’t know much about prime numbers, then you are going to have trouble studying cryptography.
Fred Wang: To be honest, it’s truly a talent work. But I wonder if you had a spirit of mischief in your mind at the time? To find out the distributing laws of primes, Riemann wrote a proof of series summation in complex analytic function, which has been researched by many mathematicians but to no avail. I didn’t expect an expert from digital currency play it so well. What are your comments to that?
Sunny King: It was a challenge for me, it took a better part of that March for me to realize the true potential of prime searching, that it could replace hashcash entirely. I was ecstatic! You know for most people problems like Riemann hypothesis - which is actually a theory about prime number distribution - are far beyond mind’s reach, it’s the same for me, or even most mathematicians, only maybe except fora very very few top minds. So I am very happy to be able to do something, to help with what I can.
Fred Wang: According to public files, since its issuing, Primecoin identified primes 16 times bigger than those based on two-way double-chain algorism in the first months. In spite of its good reputation, its marketing was not very well. Its latest circulating volume is close to the level of 2013, but its ranking has fallen to 168,slipped out of Top 5 in 2013, indicating it is undergoing a downside trend. What exactly happened to Primecoin?
Sunny King: It’s probably the same thing with Peercoin. To be fair, it’s more of a reflection of the change of competition landscape in the industry.
Fred Wang: Quite a few people have a problem with the waterloo of Peercoin and Primecoin. Some even call you the most notorious deserter in the last round of bear market. As the founder of Peercoin and Primecoin, why did you choose to get away in the middle of developing? After leaving, what kind of business did you focus on?
Sunny King: I did not desert crypto. I kept maintaining Peercoin and Primecoin and respond to community.Although one must understand it’s more about team building, civilization is about working together to achieve a dream. I cannot do it all alone. So for Project VEE this time we definitely should learn some lessons from before.
Fred Wang: Media reports say that Vittorini, a once assistant of yours, said King prefer to resolve technological issues rather than deal with marketing or communication issues which is, from his perspective, is your biggest failure. Technology, marketing and Communication, which one of them is more important to you? Since Peercoin and Primecoin share a lot of similarities, have them inspired you to do some deeper thinking?
Sunny King: We also consider these questions of course. Marketing and communication is as important, I certainly agree. This is something I often stress to the VEE team.
Fred Wang: Not long ago, you announced that VEE would adopt a full-new consensus mechanism called super node proof-of-stake(SPoS). According to your explanation, SPoS is similar to DPoS but can reduce the development and maintenance work to a much degree. What’s your original purpose of inventing SPoS? Where does your inspiration come from? Some community members doubt that SPoS doesn’t provide effective solutions compared with DPoS, do you need to respond to these voices?
Sunny King: It’s similar to DPoS because in our view it’s a natural evolution of the PoS Consensus technology, so the general direction was there. Compared to EOS design of DPoS,I think SPoS is more beautiful, with simplicity and purity of PoS concept.
The Fifth Generation of Bitcoin
Fred Wang: Besides, SPoS need to operate on special hardware which are similar to ASIC mining machines but cost less power. Why did SPoS consider the adoption of hardware support?
Sunny King: This is a misunderstanding. There is no ASIC. SPoS super nodes are just regular servers with better hardware resource. The system provides incentive for keeping up with system performance requirements.
Fred Wang: When I log in VEE’s official site, I find that the definition of VEE is “the fifth generation of Bitcoin. Since VEE uses new PoS mechanism, why does your company choose to compare it with bitcoin of PoW? How are we supposed to understand the concept of “the fifth generation”?
Sunny King: It can be understood as next generation, the generation beyond the 3rd. It’s from our marketing and I think it means generation of crypto currency or crypto platform, but saying Bitcoin cater to more people I guess.
Fred Wang: A lot of people has raised their doubts on VEE. The most impressive one, in my opinion, is theopposite voices from Peercoin community and development team. Some community members think that you didn’t communicate with the whole community in detail and posting message in the forum is far from being desired. What makes the scenario even worse is that development team members warned each other of the Opacity and tried to convince others not to invest in it. Some people led by Randy Vittorini even warned that VEE is nothing but a marketing hype which made use of your reputation. Why didn’t VEE program receive support from the founding team and community members? Maybe you can clarify the misconception if any through Ten Questions with Fred Wang today.
Sunny King: Peercoin established its own foundation and improved the organization this year, so it’s normal that they view the project as separate. I still keep a good relationship with both Peercoin and Primecoin community and serve my role. I am very happy that both Peercoin and Primecoin seem to have better organization and development road map now, so hopefully that would somewhat alleviate the sentiment that these two projects are not successful or abandoned.
Fred Wang: Some professionals believed that blockchain was first initiated by a group of Austrian School and IT participants, and considered it a social experiment conducted by the group of elites including developers, hackers, math genius,coding experts and other talented personnels.
You once said that you admired Austrian School very much. I sorted out some famous representatives figures including Carl Menger, Promisel and Hayek. Some of their published points include value is subjective and that is important in terms of satisfaction of substance to people. Value is a directly outcome of scarcity and efficiency. The amount of value is determined by the amount of marginal utility and has nothing to do with sociallabor.
In your opinion, during the development of blockchain, what’s the biggest contribution Austrian school economists made? The practice of blockchian also drive the progress of economics research, what kinds of changes do you think blockchain will bring to the economics field?
Sunny King: I think one thing we have figured out is that money can be completely virtual, it needs not be a commodity at first. In that sense monetary utility is also value by itselfe
According to my knowledge, Austrian school economists attach great importance on a free market with individualism and subjectivism being core elements. However, where there are people, there are schemes and tricks. A lot of people dive into the blockchain industry to seek wealth overnight, which explains the reason why speculating activities are so popular in this industry, making a lot of market makers thrive on cheating on others.
Fred Wang: It seems that blockchain highlight the vulnerabilities of human nature when it is designed to build a Utopian society in the name of freedom. How does blockchain should strike a balance between respecting human’s subjective initiative and limit human’s weakness? In this progress, what challenges will we face?
Sunny King: I think I have grown beyond having to subscribe to a specific ideology or theory. The more important thing is that we have choices, so we can experience the world for ourselves and realize the errors in our ways. If sacrificing some freedom makes a better society, will you join such society? So if it is not forced upon you,I don’t see why it cannot exist. According to some US founding fathers, it was how governments can be legitimately founded for. These are probably tough questions for everyone I think. So I think it’s more important for the world to abandon the cold war era mentality and allow for more civilized competition between different ideologies. On the other hand, it’s probably also inhumanity’s best interest to allow the crypto experiment to keep its place in the world.
Fred Wang: In April, the economist Saifedean Ammous tried to confirm that bitcoin was an outcome of Principles of Austrian Economicsin his book “The Bitcoin Standard”, do you agree with him?
Sunny King: What I can say is that, I think Satoshi was definitely a special kind of gold bug, he wanted the money supply capped! I don’t know of any Austrian School economist who wants gold mining stopped. But I respect Satoshi’s opinion, anyhow we have enough high inflation currencies, so why not try something else?
Fred Wang: Last Friday, the Gemini Dollar (GUSD), which approved by the New York Financial Services Department (NYDFS), was launched worldwide.The Gemini dollar is a cryptographic token built on the Ethereum Network according to the ERC20 standard for tokens, and has a 1:1 beg with U.S dollar.The Gemini Dollar, whcih is the world’s first regulated stable coin, has brought huge impact to the crypto currency field. Based on the “government regulatory background” of GUSD, howmuch impact will it have on USDT, which has been questioned by insider tradingand financial opacity? Furthermore, can the emergence of GUSD significantly increase new investors? Lin Li, the founder of Huobi Global, expressed in a social media network that stable coin or legal digital currency is the most important infrastructure in the blockchain industry. Do you agree with him?
Sunny King: I think it’s a bit exaggerated. US had a period in history where every bank can issue its own banknote (paper money). So this is something similar, but in a digital twist.What’s really important is that the government is more open to allow the free exchange between fiat and crypto, which is crucial to the prosperity of future virtual economy.
Fred Wang: The launch of the GUSD also means that the digital dollar has taken a big step toward compliance. In association, since the beginning of the year, the currency of many countries has been seriously devalued. For example, Argentina's peso depreciated by more than 50%, Turkey's lira depreciated by 40%, Brazil's Real was depreciated by 20%, and South Africa's rand was depreciated by 16%. If people in these countries consider using GUSD, they may be immune to the devastating depreciation of their currencies. If the digital USD represented by GUSD gets wider recognition, what is the significance of the national border?
Sunny King: Yes it will make it easier to obtain USD equivalent assets. But USD may also be not strong forever. The value of fiat is really linked to the issuing country’s prosperity. I personally still favor getting at least some crypto to hedge one’s fiat hyperinflation risks, but of course within one’s own risk tolerance.
Fred Wang: Insiders believe that from a policy and strategic perspective, the United States is taking advantage of this opportunity to introduce digital dollars into the crypto currency market and re-plan the global strategy of the dollar. Do you think that the legalization of GUSD really implies the US conspiracy? The blockchain has moved from the parallel world pioneered by BTC to the existing world of legal currency. In addition, US government finally supports USD backed stablecoin, how much impact does this have on global financial markets?
Sunny King: I don’t know,maybe. But I think governments are still wary of the potential of crypto. I don’t know the details of GUSD, but stable token had quite a bit history already, Bit Shares, Nubits. How much trust can you put into the peg of GUSD?
Fred Wang: Will the USD pegged stablecoin gradually replace the position of Bitcoin?
Sunny King: Of course I don’t believe so. Fiat money certainly has its place, but Bitcoin opened up new world of strong private property.
Fred Wang: Dr. Feng Xiao, Chairman of the Board for Wanxiang Blockchain Labs, expresses at a recent public speech that technologies such as new sidechain, sub-chain, cross-chain, layering, fragmentation, partitioning will mature in 2019 and the main network will go online. This is considered a prerequisite for large-scale commercial application of blockchains. In your opinion, is 2019 a critical year for public chain technologies to mature? What are the indicators for a matured public chain technology?
Sunny King: Maybe, that’s why VEE has been busy positioning itself in this trend. However I think the industry will keep evolving, these technology have plenty of room to further develop in the coming years.
Fred Wang: According to data from One Top Labs, the total number of DApps worldwide reached 1,844, and the number of daily active users reached a total of 15,930 users, while the total follow-ups exceeded 200,000 users.Furthermore, according to the information provided by the data website DApp radar, the current DApp on the Ethereum and EOS platforms are basically in the category of decentralized exchanges (DEX)and games. Among them, the most active DApp on Ethereum platform is IDEX, and the number of daily users is 1942. The most active DApp on EOS platform is EOS Knights, and the number of daily users is 886. What do you think is the reason for this awkward situation with such a low DApp activity? Where does DApp’s future lie?
Sunny King: I guess we are probably spoiled by the speed of advancement in cryptos :) Even the market cannot be on a high all year any year
Fred Wang: From a more technical angle, what are the bottlenecks for large-scale commercial application of blockchain? Is it security, information protection, performance of trading, or reward system? How long are we from large-scale commercial application of blockchain?
Sunny King: It’s many things,but I think the cost compared to other technology is probably the main hurdle.It’s getting close.
Fred Wang: Just recently, blockchain security startup BitGo has received regulatory approval to offer crypto asset custody service, which is aimed at the growing demand of institutional customers. BitGo has since became center of attention for it’s the first and only regulated custody service available on the market offering exclusively for digital asset storage. Billionaire bitcoin bull Mike Novogratz has previously predicted that the institutional funds brought by the custody business may enable Bitcoin to regain its former glory. Will BitGo’s custody service development reignite hope for there turn of a bull market?
Sunny King: In the crypto I guess anything is possible. Is till remember the year end low of Bitcoin in 2011. So who knows. Though it does signal a move of crypto into the higher wealth hierarchy. Who knows, we shall see.
Fred Wang: On September 8th, Ethereum Founder Vitalik Buterin mentioned that “the exponential growth of blockchain industry will not sustain” during his Bloomberg interview. Buterin clarified further after Founder and CEO of Binance Changpeng Zhao twitted against his previous point: “In ever said that there is ‘no room for growth’ in the crypto ecosystem. I said there is no room for ‘1000x price increases’. A 1000x price increase from today means $200T in crypto, or ~an entire 70% of today’s global wealth being in crypto.” Zhao later responded: “I still believe that the crypto currency ecosystem will reach or even exceed 1000x price increase. When the cryptocurrency reaches the market size affected by US dollars, it is equivalent to 1000x increase. Furthermore,the scope of application and the derivatives application of crypto currency will be much larger.”
Whose side will you take, Buterin or Zhao? What is the scale of crypto currency do you predict? Is there really “no room” for the exponential growth of crypto currency?
Sunny King: Longer term, I think the possibility is always there. 1000x if measured against fiat, who knows, maybe next decade fiat could inflate 5x by itself. So it does not necessarily need to reach 70% of current world wealth. We mentioned that future virtual economy could become significant. Say 20% world economy, so I think long term it’s still possible. It’s hard to imagine the life of future world,just like 30 years ago it’s also hard to imagine the world today. Can you imagine today’s China 30 years ago?
Fred Wang: People refer blockchain to the fourth technology revolution, and often of times use internet development to scale blockchain development. In Chang peng Zhao’s reply to Vitalik Buterin, he also used companies such as Google, Facebook, Aibnb and Uber’s developments as references. Do you think it’s reasonable to use technological revolution cycle to judge and predict blockchain? Internet is a system of centralization, but blockchain is decentralized. Between these two technologies, will they grow independently, one over another or together?
Sunny King: The cycle seems evolving ever faster now. The world has so many more highly educated population to tackle on technical challenging problems. See the development of cloud, AI, it seems moving at ever faster paces.
ButI do agree that centralized and decentralized system will coexist in parallel for the foreseeable future. Centralized systems still have its efficiency advantage.
Fred Wang: Founder of bitcoin, Satoshi Nakamoto ‘s real identity has remained a mystery. Very similar to Nakamoto, Sunny King is your pen name and you’ve never appeared publicly. Also as a legend and an anonymous figure in crypto currency space, what do you think of Satoshi Nakamoto? Do you plan on remaining anonymous? Common folks might not understand the world you are in.
Sunny King: Satoshi may be truly anonymous, for me it’s just for privacy reasons now.
Fred Wang: In an interview in 2014, you spoke frankly the reason for anonymity was due to political factors. My understanding is that the current political environment has unforeseeable risks to you. However, after five years, many countries have shown positive attitude toward crypto currency. For example, in 2017, the Australian Securities Regulatory Commission opened policies for investors to buy shares in listed companies in Bitcoin last year. Venezuela became the first country in the world to issue legal digital currency by releasing a white paper on petroleum coins in February 2018. In August, Malta became the first nation to offer official government regulation and policies for blockchain and crypto currency. Do you think you will remain anonymous with an easier political environment? In what particular circumstance, will you take off the mask and face the public?
Sunny King: I know everyonehas curiosity, but really I am just an ordinary person just like everyone else.
Fred Wang: I’ve noticed during an online interview with Let’s Talk Bitcoin in 2014, you answered Chinese Dim Sum when asked what your favorite food was. In the bitcoin community, someone said you are Chinese and graduated with Math major from Beijing University? It’s a natural guess of probability since your founding team is composed mainly of graduates from Beijing University.
Sunny King: Actually thereare plenty people who knows my identity. But why not keep some fun still.
Fred Wang: Your network avatar is a comic character “Flame Champion” from the video game Suikoden III by a Japanese gaming company KONAMI. In the game, “Flame Champion” leads a group of bandits rob from the holy empire and return the wealth back to the commoners until he wins in dependency from fighting the empire and then disappears once for all. What is the real meaning behind using the comic character “Flame Champion” for your network avatar?
Sunny King: It’s actually a coincidence, I don’t know if you will believe me or not :) I wasn’t aware of what the picture was about, but somehow I picked it up on the Internet. It’s about a famous novel of China from probably 500 years ago, I get it now. Some speculated the author’s name is also his pen name, so you see, the anonymous tradition goes way back in the Chinese history :)
Fred Wang: I think what’s really important is that we keep an open mind, who knows what the technology development would lead humanity to, maybe it’s a much brighter future. It would be good enough that 500 years from now people could say that we did what we could to the best of our abilities, just like the author of the famous Chinese novel did
After chatting for the entire night, I just realized a critical issue. If Sunny King never revealed his true identity, how do we believe that the network avatar is you, the real Sunny King? How do you prove you are in fact the real Sunny King?I guess that question remains unsolved.
Fred Wang: Nowadays, blockchain has provided us a key to the door of freedom with a variety of features including decentralization and anonymity. As far as I am concerned, freedom is the top priority for whatever mechanisms under discussion—whether they are PoS or SPoS, then comes the optimal allocation of resources.
I hope Sunny King’s return with VEE will bring us more possibilities and lead us to explore the realization of a free world.
Finally ,I’d like to conclude this show with a quote of Frédéric Bastiat, a pioneer of Austrian School of Economics and famous economist, ” It seems to me that this is theoretically right, for whatever the question under discussion — whether religious, philosophical, political, or economic; whether it concerns prosperity, morality, equality, right, justice, progress— at whatever point on the scientific horizon I begin my researches, I invariably reach this one conclusion: The solution to the problems of human relationships is to be found in liberty.”
Thank Sunny again for joining Ten Questions with Fred Wang. Thanks, every friend!