Tag: NFTs
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Best of 2022: Trends in Blockchain for 2022
As we close out 2022, we at devopsy.kinsta.cloud wanted to highlight the most popular articles of the year. Following is the latest in our series of the Best of 2022.
Blockchain is hot right now. The industry has a staggering CAGR rate of over 69% between 2019 to 2025. Blockchain is no longer only relevant to cryptocurrency, either—blockchain-based applications are emerging to support many other scenarios that require decentralized data storage and accessibility.
I recently met with Medha Parlikar, co-Founder and CTO, CasperLabs, to learn about some of the top trends that will likely impact this burgeoning sector in the coming months. According to Parlikar, we are still in the early stages of both blockchain and NFT development, and 2022 will see continued growth in the sector.
These movements will likely include more significant investment into blockchain technologies and the emergence of nuanced business models that leverage NFTs. Proof-of-stake (PoS) models will likely become more critical to curbing negative climate impacts and more solutions will emerge to support the development and operations that sustain blockchain-based applications.
Continued Blockchain Investment
First, we will likely see greater investment in blockchain technology in the coming year. Unsurprisingly, finance will probably experience the most adoption, as the use of blockchain in the financial sector is anticipated to reach a value of 22.5 billion U.S. dollars by 2026. But outside of finance, blockchain investment will seep into innovative areas as well. For example, spending on blockchain in health care is expected to rise to $5.61 billion by 2025.
Blockchain not only appeals to corporate interests—developers on the ground seem excited as well. “Developers are waking up to the opportunities that blockchain brings,” explained Parlikar. “We’ll see a big increase in developers moving into blockchain.” She pointed to a surge of developer interest in blockchain to construct tools that go beyond widgets to extract real business value.
We’re also seeing a peak of interest in blockchain funding from nation-states. For example, in 2021, the European Union announced plans for a multibillion-euro investment into blockchain infrastructure.
Uncertainties Around Regulation
Blockchain is ushering in major economic shifts. But the cryptocurrency market is still a ‘wild west’ with little regulation. According to recent reports, it appears the U.S. Securities and Exchange Commission is gearing up to more closely regulate the cryptocurrency industry in 2022.
“More investment in blockchain is bringing it into the mainstream, but what’s holding back a lot of adoption is regulatory uncertainty,” said Parlikar. Forbes similarly reports regulatory uncertainty as the biggest challenge facing blockchain entrepreneurs.
Blockchain is no longer relegated to the startup domain, either; well-established financial institutions also want to participate in the massive prosperity, said Parlikar. This excitement is causing a development-first, law-later mindset, similar to the legal grey area that followed Uber as it first expanded its rideshare business.
“[Blockchain] businesses are trying to hedge risk,” Parlikar explained. “We want to comply and aren’t doing nefarious things intentionally—there’s just a tremendous opportunity to innovate and streamline operations and increase the end-user experience.”
New NFT Strategies to Emerge
If you follow any artist accounts on Twitter, you’ve probably heard a lot about NFTs lately. Non-Fungible Tokens (NFTs) use blockchain technology to imprint ownership and value onto all types of assets.
“I see NFTs as a great representation of the real world,” said Parlikar. Blockchain-fueled NFT technology is creating marketplaces out of ephemeral or purely digital things—such as 3D artwork—which could not be easily traded on typical markets.
But, we’re likely only on the cusp of overall NFT usage. “The value of NFTs is still underutilized,” said Parlikar. Right now, NFT marketplaces are mainly just about asset ownership. But there’s no reason one couldn’t build, for example, an NFT rental system that shares access for a period of time, or one that offers subscriptions for recurring revenue, she suggested.
“[There are a] lot of interesting markets that could emerge,” said Parlikar. For example, combining NFTs with the internet of things (IoT) could bridge the metaverse to the real universe, proving ownership for our physical assets.
Proof-of-Stake (PoS) Response to Energy Backlash
The dark side of cryptomining is that it takes significant computational power. Unnecessary computation is a drain on energy that exacerbates humanity’s environmental impact. And, if your say in a network is correlated solely with computational power, there will inevitably be an escalating computational arms race to one-up others in the network.
This is why Parlikar is putting faith in proof-of-stake blockchains. “Proof-of-stake is definitely the way to go,” she said. In PoS networks, power is tied to the state of each actor in the network, which can be determined or modified by a consortium. Participants can agree on the governance model and set boundaries. This is opposed to proof-of-work (PoW), in which your power in the network is directly correlated to computational power.
PoW systems become unsustainable for enterprises trying to spin up their own blockchain networks, or when attempting to lift up an entire industry, Parlikar explained, as well as increasing negative environmental impacts. Thus, PoS are a better fit to bring collaboration to enterprise-grade consortium networks.
More Blockchain DevOps Solutions
Overall, blockchain penetration is still relatively low. This is, in part, due to the fact that it’s still tough to use. As I’ve covered before, blockchain-based development is still relatively inaccessible. It requires nuanced theory to grasp and specific technical knowledge to implement. “It’s not trivial,” added Parlikar. “Dealing with private keys, obtaining keys—it’s still very complicated to get started.”
Managing a blockchain could also use a dose of DevOps. Yet, blockchain’s immutability and decentralized nature create friction with traditional DevOps. “The majority of protocols will not allow you to put a smart contract under CI/CD,” Parlikar explained. Thus, organizations may opt for blockchain solutions that play nicely with test-driven development. These solutions will likely enable the ability to iteratively develop using established DevOps pipelines.
Benefits and Challenges Ahead
Interest in blockchain and distributed ledger technologies continue to surge. But, what are the end benefits of this blockchain and NFT-infused reality? According to Parlikar, we are heading toward “a world with greater trust and transparency.”
Blockchain ensures provenance. To put it plainly, it validates that something was done at a certain point in time. With this knowledge, participants in a network could prove things beyond a shadow of a doubt.
This has the power to avoid corruption and unlock more collaboration and value potential. “You don’t have to trust an individual—you can trust the information they are providing,” said Parlikar.
It’s still early in the blockchain revolution. “Blockchain technology is still at the embryonic stage and facing many challenges,” wrote the European Commission in their report, Blockchain Now and Tomorrow: Assessing Multidimensional Impacts of Distributed Ledger Technologies. For blockchain to reach ubiquity, the community will have to overcome challenges, including lowering the energy footprint, improving developer usability and responding to impending legislation.
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Theranos’s Holmes VC Reverb | 5G C-Band Marches On | Mozilla Jumps Shark
Welcome to The Long View—where we peruse the news of the week and strip it to the essentials. Let’s work out what really matters.
This week: The conviction of Theranos CEO Elizabeth Holmes leads to greater scrutiny of startups, higher-frequency 5G NR is creeping towards reality, and Mozilla gets criticized for promoting climate-harming scams.
1. Holmes Case Causes Valley Rethink?
First up this week: Elizabeth Holmes has been found guilty of defrauding Theranos investors. But how will the affair change Silicon Valley’s startup-and-funding culture?
Analysis: Don’t fake it—just make it.
This could be a seminal moment, causing investors to look more closely at startup founders and their outlandish promises. On the other hand, key Theranos investors—e.g., Murdoch, Cox, DeVoss—hardly fit the mold of Silicon Valley VCs.
David Streitfeld: The Epic Rise and Fall
F. Scott Fitzgerald’s creation … Jay Gatsby … was a bootlegger [and] sold fake bonds. Ms. Holmes chose Silicon Valley, the last and greatest of all human dreams. [She] was a natural salesperson, as good at bending reality as Steve Jobs himself.
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She and her deputy and boyfriend, Ramesh Balwani … thought they could brazen it out in the Silicon Valley tradition until they had something that actually worked. [But] the verdict signaled the end of an era. In Silicon Valley, where the line between talk and achievement is often vague, there is finally a limit. … It is an epic rise and fall that will be chewed over in the coffee shops and juice bars of Palo Alto, Calif., until the tech industry departs [for] off-world colonies.
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So where does this conviction leave … her investors and former fans? Ripe for the next huckster that comes along, probably. Some Silicon Valley promises are so sweet we just can’t get enough of them. Immortality. Crypto. Flying cars. Mars. Digital harmony. Wealth beyond compare.
Think different, thinks DeanonymizedCoward:[There’s a] fine line between bombastic marketing spam, “fake it ’til you make it” pitches, and outright fraud. … The first is repugnant and sometimes unethical, but generally legal.
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[But] If your product requires bull**** to get funded—even if it ultimately works—you’re a fraud. … Regulatory reforms … and a sort of corporate death penalty … can fix a lot of this by making it less financially practical to engage in ****ty behavior.
Who else is to blame? Ask DS999:I am sure some of her investors didn’t really care whether it worked. They just wanted to get in early, ride the hype train up, and sell before actual results mattered.
2. FAA and 5G Carriers Kiss and Make Up
Higher-frequency 5G NR is creeping towards reality in the U.S., thanks to the FAA backing down. After the aviation regulator had vetoed C-band deployment—based on precious little evidence—it looks like as much as 280 MHz of extra spectrum is now ready to switch on.
Analysis: Nomadic DevOps gets more bandwidth
While band 77 is nowhere near the much-vaunted “FR2” extremely high frequency bands, this is a useful chunk of extra spectrum for mobile and nomadic apps. Next stop: ubiquitous Ka-band.
Jon Brodkin: FAA agrees not to seek any more 5G delays
The Federal Aviation Administration tentatively agreed not to seek any more 5G delays from AT&T and Verizon, potentially ending a battle over the aviation industry’s unproven claim that 5G … will interfere with airplane altimeters. [Their] C-Band spectrum licenses are for the frequencies from 3.7 GHz to 3.98 GHz.
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The deal incorporates voluntary commitments that AT&T and Verizon previously made, including “C-Band radio exclusion zones” around airports for six months. [They] modeled the exclusion zones after those used in France, which are 910×2100 meters.
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Assuming there are no further problems, AT&T and Verizon would be able to use their spectrum licenses without extra restrictions after July 5. … President Biden applauded the agreement … calling it “a significant step in the right direction.”
In summary? Here’s Dieter Bohn:The agency in charge of airplanes is mad about wireless things. But the agency in charge of wireless things and the companies that make them lost a game of chicken.
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GREAT JOB AMERICA. … I always said I wanted Internet Service Providers to be Dumb Pipes, but I never expected them to be this dumb.
Has anyone read the FAA’s detailed report? bburdge has:I can see why the FAA is backing down here now, it only makes sense when your key report could be paraphrased as: “We got a couple grad students to run some basic model comparisons … using altimeter data from the aviation industry (with a proven track record of lying to us) and then went golfing for eight months before publishing … but didn’t bother … to actually test anything.”
3. Mozilla Forgets its Values
Firefox custodian, the Mozilla Foundation, has angered many by promoting a “grossly irresponsible” “Ponzi scheme” that harms the environment. What is this awful thing? I hear you ask. It’s cryptocurrency.
Analysis: Imaginary money is bad—is this the last straw for Mozilla?
Less than a year ago, Mozilla said it wants to be carbon-neutral, but it’s already reneged on that promise: Distributed proof-of-work systems require … well, work. And that work uses ridiculous amounts of energy per DeFi transaction. Electricity production is a zero-sum game, so cryptocurrencies and NFTs cause climate change by emitting ridiculous amounts of CO₂e.
Liam Proven: Mozilla founder blasts browser maker
A few days ago, Mozilla Foundation invited netizens on Twitter to send in cryptocurrency donations. … This move by the Firefox browser maker rapidly drew criticism.
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As recently as September, Moz’s web-standards lead Tantek Çelik slammed cryptocurrencies as being unsustainable, stating: “[They] are harmful for sustainability. … Their energy requirements grow without any discernible upper bound, which is grossly irresponsible given the global environmental crisis.”
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Mozilla has accepted crypto-coin donations for years, perhaps as part of its long-ongoing efforts to alienate its own users: It’s only the payment provider that changed.
Chief among critics was Jamie “jwz” Zawinski:I founded Mozilla and I’m here to say **** you and **** this. Everyone involved in the project should be witheringly ashamed of this decision to partner with planet-incinerating Ponzi grifters.
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Stop saying you were promised flying cars. Unless you were born in 1935, you weren’t promised flying cars, you were promised a cyberpunk corporate dystopia.
It’s a shark-jump moment thinks Jeremy Keith:The most convincing argument I’ve heard yet for switching away from Firefox as my main browser comes from Mozilla. I wasn’t expecting that plot twist.
The Moral of the Story: What is safety to one is not always safety to another.
You have been reading The Long View by Richi Jennings. You can contact him at @RiCHi or tlv@richi.uk.Image: Benjamin Hayward (via Unsplash)
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Enterprise Blockchain Adoption Hinges on DevOps
There is a lot of excitement around blockchain right now, for a good reason. Production use cases continue to emerge across sectors such as manufacturing, energy, air travel, insurance and finance. Gartner predicts that by 2023, organizations using blockchain smart contracts will see a 50% increase in their data quality.
Yet, Gartner also predicts that blockchain will reduce data availability by 30%. Before its use can reach ubiquity, blockchain-based application development has some hurdles to overcome. And if enterprises are to get on board, executives will need to see tangible proof of its value in the form of reduced expenses and increased profits directly correlated with blockchain adoption.
“Enterprises aren’t going to change their business model to adopt a new technology,” said CasperLabs CEO Mrinal Manohar. Just as it’s difficult to dramatically alter the UX for established products, it’s similarly difficult to change the developer experience for established software production routines.
I recently met with Manohar to discuss the limitations and the changes required to accelerate enterprise blockchain adoption. According to Manohar, much of it boils down to taking a DevOps approach—reducing energy use, enabling CI/CD, ensuring stable development environments and providing room for change and ongoing testing—will be critical to spur adoption. This could also mean abstracting complexity away from the developer and end users. However, once more production proofs are out there, the shift toward blockchain will be swift and it will be massive.
What’s Hindering Enterprise Adoption?
Enterprise adoption comes down to UI and UX, said Manohar. He predicts blockchain will follow a similar path as the internet. In its command-line days, the internet was only adopted by die-hard techies. But once visual-based actions were possible through the browser, consumer interest exploded.
Similarly, blockchain might see more production use once the complexity is pushed to the background. “A technology is awesome when it’s 99% invisible,” said Manohar. However, at the moment, blockchain is 99% visible, he adds. For example, it isn’t easy to spin up a node and test a blockchain app. Lowering the requirements to 50% with more abstraction, simulation and integration with cloud providers could help tremendously.
In general, Manohar believes that four key factors are hindering enterprise adoption:
- Enterprises need a lower energy footprint. Attaining high throughput on a public network without sacrificing decentralization and security is tricky. If blockchain drains operations when scaled, organizations may simply opt for a centralized data store. Therefore, enterprises will require a blockchain with minimal energy requirements.
- Large companies want developer environments that are similar to what’s already in place. In many ways, blockchain throws out the old playbook. But such a significant shift is a hard sell across multiple IT divisions. Large companies will require blockchain abilities that plug into the existing developer stack. Using a blockchain with familiar programming languages and plugins to popular IDEs like Visual Studio and IntelliJ will decrease onboarding effort.
- They need more control. Blockchains typically use immutable contracts. This is great for sustaining a shared distributed history, but Manohar believes that contracts need to be more malleable to enable continual upgrades. Furthermore, there is the issue of privacy when adopting blockchain. Some implementers don’t want all 100% of data to be on the public chain. Having the ability to maintain both private and public nodes for smart contracts could help enable more flexibility.
- Enterprises want ongoing support. Some companies will be autonomous using open source, but most enterprises will not adopt new or emerging technology without a support email attached to it, said Manohar. Thus, there may be a need for professional services and outsourced blockchain experts.
Applying a DevOps Perspective
Another big boon to accelerating blockchain adoption could be considering a DevOps perspective. To Manohar, introducing DevOps into blockchain requires more continuous updates, mitigations to avoid breaking change and simulations to enable better testing environments.
An immutable blockchain infrastructure seems to be at odds with the DevOps creed of rapid deployment. Thus, Manohar said that choosing a blockchain that enables more mutability will help upgrade contracts and allow functionality to change over time. For core infrastructure changes that affect the entire public chain, the majority of validators must, of course, accept upgrades before they are distributed.
Simple functionality, like a push notification, could ease this process to allow a quick Yes or No response from operators.
Another potential concern is backward compatibility. What if the aggregate introduces significant breaking change? Manohar said that while this is technically possible, it’s improbable. “That would be a controversial upgrade,” he said, and validators have an incentive to keep a sturdy system intact. “They only do it if they think it’s better for the long-term health of the network.” But guardrails on this process will help avoid edge cases. Thankfully, if a change did disturb a minority of users, a blockchain can be forked. We’ve already seen this occur with Bitcoin Cash and Bitcoin, or Ethereum Classic and Ethereum, for example.
Another shift that will help enterprises embrace DevOps in their use of blockchain will be better testing and deployment processes. It’s notoriously challenging to test blockchain applications while they are tapped into the broader network. Thus, engineers could benefit from a simulated runtime wholly divorced from the main network for testing purposes.
The Future of Blockchain Development
So, what does the future of blockchain enterprise adoption look like? Well, it appears we will continue to see new novel use cases emerge that use blockchain in innovative ways. For example, Manohar pointed to the use of blockchain to power an NFT digital twin, a patent marketplace, a tagging system for supply chains and the mortgage processes for a core banking system. Within these scenarios, he noted how blockchain is exorcising cost in many ways; smart contracts are being used to avoid legal fees, eliminate manual processing and improve fault attribution.
Before blockchain can go mainstream, however, work must be done to bring other enterprises into the fold. Namely, it will necessitate more abstraction of the infrastructure layer. In this effort, low-code integration capabilities could help make API connections to ERP systems or cloud service providers more accessible.
To inspire adoption, the economy must also change its perspective on what constitutes blockchain success. As of now, common KPIs are surface-level, like: How many wallets? What is the trading volume? Instead, Manohar believes we need to focus on proving actual cost savings from blockchain adoption. Once accountants are publicly reporting revenue gains, shareholders will demand that every company do this, he said.
“Once that catalyst happens, adoption will happen very, very fast, and demand for blockchain in enterprises will be massive.” At that point, some years down the line, blockchain may truly power a new economy.
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Making Blockchain-Based App Dev More Accessible
Blockchain has many potential uses cases outside of cryptocurrency. Established sectors such as financial, automotive, supply chain, and mobility could soon move to adopt decentralized applications and distributed ledgers. The technology has even been hailed as the ideal foundation to maintain a connected economy once humans go interplanetary.
Recently, spectators note a swelling interest in decentralized, peer-to-peer, autonomous development approaches. Eyeing the excitement around cryptocurrency and blockchain, many developers are eager to start experimenting with their own blockchain-based applications. This incoming disruption could remove the middle man and give power back to people, says blockchain and cryptocurrency entrepreneur Max Kordek.
However, building your own blockchain from scratch is incredibly difficult. So, I recently met with Max Kordek, co-founder, Lisk, to understand how to make blockchain-based app development more accessible. According to Kordek, there are many benefits to creating your own blockchain, but simplifying the creation process will be necessary to empower new startups and enable this new paradigm to flourish.
Potential Use Cases
The decentralized, tamper-proof nature of blockchain has disruptive potential to remove central authority and give more data control to the collective hive. “For me, it’s all about removing the middle man,” said Kordek. “It gives power back to the people.” Cryptocurrency is obviously the most widespread use case; Bitcoin is proof that a blockchain-based system can see mass adoption. But there are many other use cases outside of cryptocurrency where similar record-keeping is important.
For example, the automotive industry could link data across manufacturers or share data between vehicles. NFTs are using blockchain to represent one-of-a-kind digital art objects. The airline industry is looking to blockchain to synchronize partner ecosystems. Blockchain is also transforming online gaming by substantiating in-game value systems.
From insurance to supply chains to transportation, most industries hold a potential blockchain use case. But blockchain isn’t constrained to only terrestrial scenarios. Information systems engineers foresee blockchain powering future in-space economies. With significant funding going toward asteroid mining and Mars missions, an interplanetary humanity seems inevitable. Compared to Bitcoin, “Ethereum is a better choice for the interplanetary economy,” said David Vandervort. Gathering transactions in blocks and pinging satellites could enable monetary transactions from planet to planet. “An interplanetary financial system would have to be built on blockchain technology,” Kordek said.
There is ripe potential in countless areas. But who will be leading this shift? According to Kordek, we may see corporations augmenting existing structures with blockchain. However, established enterprises will find it challenging to unshackle themselves from legacy systems. Instead, new startups are more likely to have a bigger say in the blockchain revolution. “It’s much more realistic that an entirely new startup adopts blockchain and structures their entire business around blockchain,” said Kordek.
The State of Blockchain Development
After Bitcoin was established, other developers forked the project and changed parameters to introduce new cryptocurrencies, such as Litecoin and Dogecoin. Eventually, Ethereum came along, which was unique as it enabled developers to build apps with smart contracts. However, “the developer ecosystem was horrible at the beginning,” explained Kordek. “It was the wild west of development.” To this day, it’s still very complicated to develop on Ethereum, he added. Plus, since it is open source and immutable, it’s vulnerable to security threats. “It’s like the biggest bounty program in the world—if there’s one bug, contracts are drained.” Ethereum also has scalability issues — it can only run 30 transactions per second, equating to 1 million transactions per day.
For these reasons, it may be better to build your own blockchain. However, doing so is a difficult task. From a research perspective, this requires a lot of theoretical knowledge, Kordek explained. Blockchain also introduces new maintenance concerns—since the infrastructure is always on, it is unstoppable, making patching a bug or pushing an update tenuous at best. If hundreds of millions of dollars are dependent upon a stable network, one mistake could have drastic repercussions. The high development and QA roadblocks make prototyping blockchain-based systems from scratch challenging. “Experimentation is essential to bring an industry forward,” said Kordek. “It’s important we simplify blockchain development so more experimentation can happen.”
Open-Source SDKs Make Blockchain More Usable
So, how do we make blockchain more accessible so that experimentation can occur? Well, a lot of progress has already been made via ready-made open source language-specific SDKs. For example, there’s Polkadot (Rust), Cosmos (Go) and Lisk (JavaScript). Kordek is an advocate for language-specific libraries that fit a team’s programming preferences. Out of these, he favors JavaScript, as it’s generally easier to learn and already supports many web-based interfaces.
These projects are not about the smart contracts themselves; they’re about improving your own blockchain creation process. According to Kordek, going down this route grants more control in the early days. If something is broken, you can fix and push and update. If tokens are hacked, you could roll back and adjust things, he said.
As companies get bigger and bigger, the technology could have a centralizing effect. “How can we somehow bring power back to people?” asks Kordek. Blockchain is one profound answer, empowering new entrants to alleviate problems across industries — it could even help us boldly go where no one has gone before.
