Orbs' hybrid blockchain technology to impact enterprise systems
Mr. Kol has spent his entire career as a tech entrepreneur. In 2012 he co-founded the mobile commerce platform Appixia which was sold to Wix. He spent the next few years running engineering at Wix and then Kik Interactive before cofounding Orbs late in 2017.
“What we saw was traditional companies weretrying to create dApps,” Mr. Kol said. “But as time progressed the problem withdApps was their infrastructure was immature. Ethereum was immature, slow.
“This wasn’t an infrastructure problem but abusiness one.”
Some of the issues are philosophical, Mr. Kol explained. The decentralized model for dApps cancels out standard for-profit business models. Then there are the structural ones common to a sector’s early days such as scaling problems, but those are starting to be solved. So are other issues through trial and error, leaving the challenge of providing public blockchains to the enterprise.
One big obstacle is simple bandwidth, Mr. Kolsaid. While in theory you could launch an Uber-style service on someblockchains, all it would take is for Crypto Kitties to launch on the samenetwork and your service suddenly stinks.
Then there’s the problem of how some companiesaddress bugs. What if the network votes to roll back the history to before thebug’s infiltration?
“That may work for dApps, but for a traditionalcompany like Uber, no,” Mr. Kol said.
The key is isolation, he said. Keep every appisolated from the others through their own virtual chains. That solvesresource, scaling and governing issues. You share the same infrastructure andthe power of validators from around the world.
“It’s a well-known concept,” Mr. Kol said. “Weapplied it to blockchain technology and it worked remarkably well. It had thesecurity and decentralization of a network but provided an isolatedexperience.”
Orbs commits to a guaranteed transactionthroughput, so if you pay for, say, 100 TPS you will always get that. You alsocontrol your governance, so if a bug appears in a different app you maintainyour own batch and don’t need network approval to rectify any problems.
What are the best applications for Orbs intoday’s marketplace? That’s an interesting question, Mr. Kol said. Doesblockchain provide value to a company like Uber? That’s hard to say and Uberlikely has no idea of where it fits in, he suggested. The value lies in helpingto establish new trust levels with users.
Mr. Kol recently was in New York and took apopular ride sharing service to a meeting across town. The algorithm lied inits estimate of how long the ride would take and that made him late for themeeting. Was it intentional? Did they do that to keep him from using anotherservice, cabs or the subway? If that company operated on blockchain technologyyou could audit it for yourself and learn the true answer.
Do the Facebooks of the world “take your dataseriously”?
“Business will come to see the best way to reach this level of trust is to rely on technology to provide it,” Mr. Kol said.
And look to the grey when arguing the merits ofpublic versus private blockchains, Mr. Kol said.
“Purely private blockchains are not innovative,there is nothing new there which we didn’t have 40 years ago.”
Mix the best of public and private blockchainsand you’re on to something, Mr. Kol said. Have block producers and validators,where the app controls the producers and the network controls the validators.
“You need both to work,” he explained.
The reputation of public blockchains suffer frommisconceptions, Mr. Kol said. Not all data becomes public and such tools aszero knowledge encryption provide adequate protection.
“The fears of business and governments areirrational,” Mr. Kol said.
Yet for all the talk about red herring securityissues, there is one vulnerability not getting nearly enough attention in theindustry and that is front running, where, if people know the node order theycan choose the order of the transactions on a decentralized exchange to enjoybetter margins.
While there is no one perfect solution, aneffective tactic could be to encrypt all transactions when they are sent tominers so they don’t know what is underneath. After the consensus round usethreshold encryption to open it.
“The miner commits to the order before they seewhat is transacted inside,” Mr. Kol said.
The problem with consensus is the tradeoffbetween security and speed, Mr. Kol said. Decentralized security wants lots ofnodes but that slows things down. What’s the solution?
With every consensus opportunity randomly choose21 node committees from every 1,000-node group. Each time choose a different1,000-node group and differently-situated nodes within that group.
“There are always 21 or 22 talking together. It’s just as decentralized,” Mr. Kol said.