Surprise AMA 08-30-2019

hi this is Charles Hoskinson broadcasting from live warm sunny Colorado the IO HK office finally we have actual office here in Colorado we have people all around the world in about 20 countries we had a beautiful office in it or have an office in Japan Argentina but somehow someway despite the fact that I live here in Colorado we never managed to get an office and we finally built one I'm very glad we have still decorating still putting some things up got a lot of paintings statues and other things to put in but I'm glad to be here and thank you all for coming I promised that we'd make some announcements and talk about a few things before the end of the month and it is August 30th so it's definitely before the end of the month in fact I think we're Darryl E anyway let's talk about carga know it's what everybody knows and loves and cares about as do I in this is on the back of a very long and arduous workshop that we had 18 people flew out here to Colorado from all around the world including Duncan and our marketing team the rust team the Haskell teams formal methods people and we were trying to get a better sense of not only where are we going but the long term roadmap so everything that we think we can get done for Cardinal 2020 and as a result we were able to get some clarity about particular release cycles and dates we've been doing things in a very agile way so we tend to have development sprints and we do these sprints as offsets we can one team does actually weekly Sprint's on an extreme programming model all the way to the formal methods team which hasn't much longer time horizon and each team has its own cycle and so we mentioned with the rust client that there were three phases to the test that phase one was the self zone test net and that has been largely successful hundreds of bugs have been reported and fix the software has rapidly evolved and cleaned up and it's gotten to a point where it's quite stable and then the second phase is the networking test now where we actually have people connect to a unified test net and do some form of staking so everything that you'd want to do is Shelly done now for instead of on your PC on a distributed system and then the final is the incentivize test and then surprise test that is where we actually allow people to stake and get rewards and guess what those rewards will be real rewards should make real money from that so these are kind of the three phases of that roadmap and basically each and every one of them accomplishes different things from proving out the protocols to building up a community of stateful operators to allowing this to get a better sense of how these systems actually work at scale with real users behind them so now the time has come for the network test that and that will be shipping next month roughly around the middle to the third fourth week of the month so earliest would be September 15th but we may decide to push it a week or two later just depending upon testing and QA and a few factors about how the release cycle is going to work people tend to play off their vacations during the summertime and there's a lot of things that have to be worked out there but middle part of next month we should have the network test that and this will be the final test net before real sneaking begins and we're very excited about that now more significant announcement is going to be on the 28th September 20th I will be in Sofia Bulgaria for the two-year anniversary of the launch of byron and that's going to be a great day we're gonna hang out with fossil who's a one of our ambassadors and he's a great community member we really do love him I'll go plant some trees and we'll have some fun and then we'll talk about the card no 2020 roadmap of what do we anticipate we're going to do where are we going to go the project throughout 2020 and we're also going to announce more likely than not the date of the launch of the incentivized test net which effectively is the launch of Shelley because staking has begun and pool operators are running money is being made as a consequence of that operation and we'll talk about how we're going to roll that into the Haskell node and how that's going to upgrade an update so there's a lot of software a lot of infrastructure explorers the wallet back-end the exchange integration this new API is the v2 API system the rest software the house go software Daedalus itself has gone through a series of major upgrades updates one point six was the most significant since launch and there's more because we all have all that infrastructure for the delegation Center for searching sake pools for being able to register a state pool and so forth and then we have a lot of other things like goblins which is our testing framework we have another framework for monitoring and logging that we developed in so forth so it's really been an amazing ride and it's really incredible to see how much software we've actually written basically we had to go build an entire ecosystem from scratch and we learned a lot along the way we ruined a lot of papers along the way September is also a very special time for the science group within our organization we anticipate that over horse Hydra will finally be done in that timeframe what that effectively means is that as determinist paper in the or Boris research line four years ago we decided to embark on a journey to see if proof of stake was solvable or not more than half the cryptocurrency space held a fairly firm belief that proof of state was perpetual motion and could not be solved as a problem and there are still many people the cryptocurrencies face who hold that belief we kept an open mind and four years ago we started a research agenda to determine and in our opinion and the opinion of the academic community whether this was a fool's errand or if the problem could be solved and was it a Pyrrhic solution or wasn't a real solution that could actually be useful and run an entire system and throughout that journey we wrote papers like gkl or worse classic warhorse prose or horse Genesis or four scripts eNOS or horse PFT or horses or Horace casinos or or as Kronos but the most important paper and the entire series was our Hydra because that's when we shard and what we do is we take all the magic all the properties all the things you've come to know and love about or Boris and really the the incredible security properties of that protocol and we go from 1 to n meaning that we actually can have the performance we need to be a global scale system so it's a big moment for us the network test net is basically a near production grade of Cardno the Shelley and Byron combined and it's a culmination of use of knowledge and the 28th is a second year anniversary since we've been live so we've really gone through many ups and downs throughout those two years and being able to announce the main neck and the incentivize test methods things is a pretty magical thing and then to say that we can also capstone that with the end of the / Boris research agenda there's still be some things to clean up and papers to rewrite and peer review to go through but the final protocol in that series throughout Colorado 2020 is a pretty rewarding experience we solved a major problem pewter science and it's to the benefit of not just the Cardinal project but the entire industry as a whole we're also going to be holding the hackathon and University Wyoming it's gonna be a huge hackathon governor of Wyoming is going to be there I think around 500 developers or so forth and that's in the middle part of the month and we're going to be showing off the next major update of Plutus to this point where polluters does now feature complete at least for reaching parity with what you can do in the etherium ecosystem so from that point forward people will begin writing Plutus applications which we know will work on the Cardinal Network so we're extremely excited to be able to to show that off site to get developers we finished the flu this book already we have two classes on udemy that we've created one for Plutus one for Marlowe and we've already received an enormous amount of feedback now that research client was just as complicated as the research line for aurora's we started from first principles and what we've been able to do is save not only what is a good smart contract language which certainly was a hard question to answer but it was also how does a smart contract language live in a real application ecosystem how do you call them how do you need to rate them with often infrastructure where does the server to client come in to all of this what is the tooling need to look like how do we reuse as much feeling as possible how do we make that code portable to JavaScript or to web assembly so that we can maximize the ability to torque that code in many different places and how do we make sure that that can scale and live within our sharing strategy extremely hard things to do all while avoiding all the mistakes that the etherium ecosystem has made and also making what we've done at minimal to formal verification as well so that people can write formal specifications and verify that their contracts are correct according to those specifications so we don't have gouge acts or the parody bug or these types of things which result the loss of millions the billions of dollars we did this in a very principled way we did this with top computer scientists one of which has over 25,000 citations throughout his career vented multiple programming languages and work for pretty much every major company that matters and we did it without compromising a bit on language design principles Plutus is a state of the art language and we're very proud of that team and it's gonna be extremely exciting come September to show off the power of Plutus to real developers and watch them build real things with that platform in anticipation for its integration into Cardinal which will come shortly after we really Shelly so September is a big month for us it's a big month for the Cardinal ecosystem and it's a culmination of a very long long long road where we've done a lot it's been hard the industry as a whole has been hard yeah watching the markets do what they've done watching the ups and downs I I'm the first to admit it's been disheartening especially because it caused a lot of good people to turn a bit negative and bitter because they lost a lot of money but this is not a sin of Cardinal this is a sin of the industry in general but many people kept the faith they kept going strong and that's why we're going to Bulgaria because all the while when these markets were hammered and all the while when the industry was going through a downturn fossil and his friends on Bulgaria were planting trees and were very passionate about the future trees that take decades to grow and trees that will live for centuries and that's the point of this project and the engineering that we do at AI ohk we do not design things for tomorrow we design things for next century and so part of that is process and part of that is strong principles and part of that is good foundations we didn't take short and say let's just take some proof of state protocol that we think may work modify it a bit maybe write an academic paper throw some math on it gilli implemented six months we started from first principles and asked what is a ledger what should the rules be what is consensus and how does that matter to our industry and we worked our way systematically paper after paper after paper involving the academic community along the way as a checkpoint a sanity check and a third-party opinion that was objective of whether the things we were doing were reasonable or not this road is often fraught with delays and setbacks and all kinds of frustrations and disappointments and this road may also take you in directions you didn't anticipate to go on when you first started but it's the only road that you can take if your intention is to build a world financial operating system because this is a process not a person it's not a cult of personality it's not a particular company it's a methodology than anyone anywhere in the world can follow and years into the future Iowa came may or may not be here it's a community decision but the process will be here and the community will demand that for every new protocol we integrate whether it be multi-party computation protocols or serology protocols or enhancements to core infrastructure and what we've now left behind as a consequence of the work we've done now since 2015 has been hundreds of pages of formal method documents tens of thousands of lines of code more than 40 papers and an acknowledgement that the things we have designed really can scale and build to a global scale financial operating system and we're future proofing it Carano 2020 is extremely exciting and September we're going to talk about it at the Vulgaria event we'll make an announcement of the particular place in Sofia will be in the particular time and you love to see as many people as possible there but that's just a milestone and there's many more to come so anyway that was the announcement for the end of August the incentives the network test that is coming in in September mid-september more likely than not the exact date will be announced in just a little bit but if it's not mid-september be the third week or fourth week but not too much beyond that and the Bulgaria event will announce when the incentivize test met will begin which is effectively shallot it'll have the wallet back-end it'll have Daedalus it'll have the rust node and a lot of magic behind it and real money being made and then it's something that'll merge into the Haskell system when it upgrades and that money will be transferred over so we'll make an announcement September 28th of exactly when that date is going to be for that to begin and then we'll just start getting on to go go and catch up there and September you guys are also going to see the one-week hackathon well we've made multiple announcements about it I believe it's September 20th I University of Wyoming in Laramie and we'd love to see you there and we'd love you to see you guys right simply be smart contracts at Marlowe's of our contracts and really get a sense of the magic that we've put there it's been a hard project to go from aspirational high-risk high-return research where we could potentially do everything to actually build something real that innovates and changes our entire industry and I'm incredibly proud with 200 people at i/o HK and all of our commercial partners and the third-party firms who have worked with us very closely throughout this journey over the last four years and assisted us throughout this journey to get to a point where we now have something significant and real and revolutionary and innovative that not just leaves a good foundation but something that we know can be iterated to something that will fundamentally change our entire industry and make us the world leader in terms of cryptocurrency technology and we did all of this while maintaining our principles that was the most important part to prove that it can be done so I appreciate everybody's patience I appreciate everybody sticking along with us throughout this long road and it's finally coming to an end and I can see the light at the end of the tunnel for Shelley and I'm really glad we finally got there yeah and it's gonna be really exciting to see you guys running snake pools it's gonna be really exciting to see the industry develop around those and it's gonna be really to see what type of innovation and infrastructure can be put together so so thank you so much for all of that anyway as it is an AMA I figure I'll take a few questions so let's let's go ahead and take a look what you guys have Charles what do you think about augur and Sylvia McCauley says he self italics trilemma it can soul scale to thousands of transactions and is secure and decentralized they use VRS to the other of course they do is Sylvia Macaulay invented the technique Algren is great science great team great people the mid moment that they announce that they're actually going to enter the space I tweeted it's finally good to have some good competition and I'm I stand by that statement I think that over the next 5-10 years they'll be around just like us and while they're taking a different approach their approach does seem to have a lot of merit legitimacy behind it and I think they have a good team of people to help them execute and get there this frankly should be the standard we should never have questions about whether the technology or science works or if the protocols are sound or not that should be axiomatic we should have a situation where those protocols we know they work and we're debating commercial strategy and execution and customer acquisition these types of things unfortunately because of the complexity and frankly the lack of domain expertise of the people running these projects perhaps some dunning-kruger we are in a position where the industry as a whole has to doubt whether protocols can actually do what they claim so it's nice to have competitors who we feel are just as good of an approach even though we disagree with the approaches we think there's legitimate things can that could be done differently but at least we don't challenge that they know what they're doing and I'll Graham fits into that category that said I think we're ahead of them by far at least by two years thanks to the fact we started sooner we've written far far more papers and frankly we have a much larger science team and we have a more holistic view of what a cryptocurrency ecosystem requires from interoperability to a treasury system to voting system in addition to how we intend on doing charting and we're a world leader interoperability with respect to proof of stake side chains and deep the Powell's proof of work site rates so given we've we have those advantages it's gonna be hard for them to compete that's if we're glad they're in this space because we can learn from them just as much as they can learn from us okay what else we got here and by the way I'm wearing a yukata say in formal Japanese dress men Japan wear from time to time how is cena's progressing well government's bill came with privacy great paper were very happy about it and we love build product on it it's not in scope for card honor we did learn a lot though about how to make these systems private which are quite helpful gives us a longer time horizon for things beyond 2020 and I love these comments from Eugene guys try to understand I was a big fan of Cardinal for years I really don't care up the money I lose but for god this guy is no more than a big scam people always say that and they never qualify those statements I remember Paul Thomas used to say tell them what you're gonna do do it and tell them what you don't you did so we told everybody what we're gonna do we said we're gonna do a high-risk high-return research project and we're gonna use a science-based approach and we're gonna go use formal methods these are among the slowest and most difficult things you can do in terms of engineering and it's very difficult to be to start up and build products this way so we said we were going to go do that give it our best shot and we went did it and does he deny that we wrote papers does he deny that formal specifications exist and if so which ones are bad which papers are good which ones are they all bad none of these papers exists with the peer reviews all lie we didn't go to the CCS and crypto and Europe we never attended any of these conferences we didn't get accepted even though that's all provably false ok well then he's saying those things have no commercial value ok maybe that's a fair argument ok well that's the formal specs I guess they have no commercial value either ok what about all the code we've written Haskell code that doesn't exist the Ross code that doesn't exist Daedalus that doesn't exist the many updates the system we did the 30 plus exchanges were listed on that doesn't exist take heed that the initial funding for the project was around 64 million give or take and it's sitting above a billion dollar capitalization so for the seed to reduce to this we're still significantly above that so the people who took the risk of launching the system they did fine but that doesn't exist I guess in his world so the only thing that does exist is that everything in our industry went to the moon and it all came collapsing down by 90% if not more and people lost money so yeah that happened Azra deadlines deadlines slip all the time especially when you're doing crazy difficult things that have never been done before unless you can point to a single project a single scientific endeavor where new things have been done that people were able to perfectly estimate the complexity meanwhile we've also changed our engineering team we went from Sara Kelton in-house team and we had to go through a huge retooling you transition for that but you see there's this value and there's this idea that somehow when we say we're going to innovate and we're gonna build something for the future that because the value hasn't been realized yet for billions of people then it's now a scam our whole argument is if you're going to build something that a billion people are going to use and it's gonna be used for 50 years you should do it carefully and spend some thought about it and utilize the best tools techniques and people available and try to get them all on board and we did we got to the peer review circles on board we got many universities on board many different companies on board and we were very transparent about this every day every step of the way all of our code is open sources it's a repo but we're a scam because you didn't make money who did and where would you make the money from let's say your stuff goes way up and you sell it somebody had to buy it well if there's no natural use for it if there's no natural consumption for it you just traded one speculator for another so while you may have made money someone else perhaps did the only way this industry as a whole will be legitimate is if the products in this industry are useful and I've made the argument time and again that the products are not useful not yet they do certain things well and if your only goal is to use it as a store of value in a safe way of moving money to have a capital controls Bitcoin has already solved that problem and it's good enough but if your goal is to build a world fun inch operating system that accounts for metadata identity compliance contingent settlement contracts that is self enforcing admissible in court and can be used to run an economy whether it be a small economy like Georgia or a large economy like China no one in our entire industry has even come an inch closer to that and we're the only project that thought about these things and talked to people like governments heads of state and other people and got a sense of what are the business requirements what are the technical requirements what must these protocols do holistically not just one component where somebody wrote a protocol and said here's our white paper look how magical and smart we are we had to look at everything the ledger rules the network rules the consensus rules the cryptography the level of privacy the structure of transactions how governance needs to work how do you do software updates who's in charge of those software updates what must the improvement proposal process look like time and again and these are easy things these are things done in a day these are things that are predictable and they'll instantly be finished now they're incredibly different difficult every single one of them and together it's a Manhattan Project it's an Apollo project because if we get it right the whole world economy will be riding on something like this ledger billions of people billions of transactions every single day carrying fuel Attili trillions of dollars of value so when is it useful when it's done when is it done when is art done it's never done it's just a series of progressions and iterations or it gets gradually more useful gradually more functional gradually more advanced over time and you wake up and you say wow it's a lot better today than it was last year and wow it was a lot better today than it was five years ago just the Internet itself the internet doesn't radically change everyday you don't wake up and open up Chrome and say wow and everything's different but if you look at a web browser 15 years ago and what a page is 15 years ago and you compare it to today is it's unbelievable difference and that's exactly what this movement is all about its gradual all hard-fought iterations step by step in a very unsexy way towards a product that will eventually create the new Amazons the new Google's the new Facebook's the new banks of the future and liberate mankind from centralized rule and so we said if we're going to do this the only way we can do this is with principles without a cult of personality and with processes over people that's the only way that's reasonable or else you will dissent from training one dictator for another dictator so if you think that's a scam or we didn't produce anything useful please do tell us who has please do tell us who execute it and who got it done which system actually works that you think is so much better and if your only argument is that people have made more money the price is higher more liquidity that you've already lost because that's not the game you've played as I said tell them what you're going to do do it and then tell them what you did and we said we're going to go do high-risk high-return research and solve major problems and build a world scale system and we're getting to a point where we have actually started accomplishing the foundations of that for a five-year period this is an unbelievable accomplishment for a start-up to do that and do it as a decentralized company real time while people bark at them in a very competitive industry it's never been done in the history of any company and I'm very proud of that so good luck to you Eugene hi Charles how long will the test never run before moving to the main man thanks for update sir it'll make that announcement on the 28th and hopefully you guys stay tuned hi Charles is Phil waddler still working at Iowa Jay absolutely every day and actually he's training some graduate students as well we're working on IOH tape projects is involved I which K keeps scaling up is writing papers too with us learning data structures and algorithms this semester I'd love to see from a technological perspective read Okamoto x' functional data structures it was his dissertation but there's now a book floating around you can learn about finger trees and so forth Nick start you do a better job at managing expectations though that's definitely true we're not so good at expectation management the key is to say to differentiate two things one is can the technology do X from will the technology actually do X will it be used for X so the problem we have in our industry is that nobody started from a first principles approach they just all copied Satoshi and kept making copies of copies of copies and then this innovated here and there for little things but they never really seriously thought about well how do these systems reach a scale of billions of people and can they reach a scale with doings of people and it turns out that that's a computer science problem it's not a business problem it's an unknown and we're getting to a point where we start to understand enough of the science that we do believe these systems can scale to that point ok so now that we know they can scale at that point there's an open question of well what is the business model to bring those users into the ecosystem to get that type of line so just because something can do something doesn't mean it will do that thing or and from an economic viewpoint that is a sustainable way so you then must look at the business model and innovate there so you have to do both of these at the same time and our belief is that Enterprise Ledger's are a great way especially in the developing world bringing millions of new users into our space to get that type of transaction volume the other ways to save the user experience of the system for the domains it's in for example payments is so much better than the incumbent user experience for some group of people that they will naturally migrate over that's a dangerous thing to do because the user experience for payment systems is already pretty good for most people in the development world so it's a slippery thing and what ends up happening is you experiment and just looking at the etherium ecosystem there's been a lot of great experiments I had a great opportunity to go to F Berlin it was by complete accident I didn't even know it was going on I was Britten Berlin to see the Beethoven's 9th at the Brandenburg Gate and earlier that day I was just walking through the park and I ran into some people wearing aetherium t-shirts and I said wow that's cool were you guys going and they said oh for aetherium Berlin they thought I was invited I didn't even know about it so I said I'll go with you and just see what it's all about so I walked up and I talked to the person at the front and I said can I talk to the conference organiser and they said what's this about I said I'll just tell them it's me the little who I am the lady came out and she said she was a consensus gal I think and she was little rumbling said no need to make a meme out of it we'll let you I said okay thank you very much you're very kind and I had a chance to walk around the entire summit which was fun and it just it was great because there was all these wonderful developers there who were quite passionate not about aetherium they were passionate about building things that solve real problems and they looked at a theorem as a means to an end it's decentralized infrastructure but at the end of the day you could just change the vocabulary and say foo coin you could project X and they would be just as passionate because they didn't wake up and say well our goal here is to make vitalik and Joe rich their goal here is to change the world and as long as you have that and you have a group of people no matter if it's in Berlin Denver or elsewhere you you're going to do that you're gonna have those billions of transactions the problem is the infrastructure just isn't where it needs to be so part of the Cardinal project was proving to the world that it can there and I think we have made a substantial contribution as have others in the space to show that that's possible and we're building it and implementing it and then it's a game of getting those people in and that's really really hard and so anybody's guess who win we have a strategy other people have a strategy it wasn't too long ago that Nikita was the king of all phones in Blackberry was the king of all phones and where are they now and apples right now at the top 10 years they could be just the Kea so markets are finicky things Charles how far apart or card out oh and a theorem relation to all the cardones plant I keep hearing if people say cardano's at least two years behind the theorem at least I'd actually already the opposite I'd say the theorems two years behind us because I believe they have to invent a lot of protocols which we've already invented they have to implement them and get them installed in a system that's already running that's much bigger than our system imagine changing the wheels on a car where your cars driving that's not really hard to do right now imagine if you're trying to change the wheels on a semi-truck as opposed to a smaller car and all of them that's the problem with etherium so they have some ideas about sharding the etherium 2.