We talked to ROBERT OLSEN, the Chief Operating Officer at Radix™ DLT Limited, about providing an alternative to blockchain, the pitfalls of block-thrashing, and how to break Bitcoin!
Firstly, can you tell us what Radix is and how it came about?
Originally, the company was called eMunie, which Dan Hughes started circa 2012. He was fascinated by the Bitcoin blockchain – he wanted to invest, and get involved in its development, but right off the bat he felt it had issues, namely, it wasn’t going to scale. So, he shared his thoughts and observations on Bitcointalk, and essentially said ‘look, this is going to have problems going forward’, and almost everyone was shutting him down. He knew these were nontrivial problems to solve, and once you get a lot of money behind something, it’s really hard to move it, to change directions. Anyway, the community weren’t that nice to him, so he thought, ‘Okay, I’m just going to do my own thing’.
It won’t take you long to figure out he’s a really clever guy. Self-taught, self-funded, methodical, and inquisitive. So basically he tried to break Bitcoin, pushing it to the MAX: How fast can it go? When does it become unstable? When does it break? He discovered that best case scenario you’re probably looking at 400 or 500 transactions per second (tps), which he didn’t feel, and most people would agree, was enough for mass-adoption globally. And that’s just people, forget about IoT, which is the big picture for us. So Dan set about building a better Bitcoin!
Regarding the name: I was invited to The European Card Payments Conference in Madrid and was sat on the top table between the Head of Visa EMEA, the Head of Samsung Pay, and opposite the VP of Western Union. I proudly presented my eMunie business card as I was explaining our Decentralised Debit Card, and was asked if we had our e-money transmitters licence? When I got back to London, I knew we had to rebrand and came up with Radix, mainly because it’s the latin for ‘root’ and, if we do everything right, we deserve to be the root of the new financial ecosystem, the root of the new digital economy. What we’ve built is a massively scalable, totally decentralised, completely permissionless, super secure digital database, that everyone -and everything- can access simultaneously.
Can you expand on the problems Radix is trying to solve?
Two big ones are scalability and sustainability. If you look at CryptoLights.info you’ll see what Bitcoin and Ethereum are doing, in real time. I found out in 2012 that Bitcoin was capable of 3 to 7 tps and thought it was a joke. Sadly not, and 9 years of R&D, it’s still the same. Even people who’ve been in the space a long time don’t know it’s that slow. I’m always keen to remind people that I’m a huge lover of Bitcoin and Ethereum, but I’m just stating the facts, and I don’t feel it’s good enough. By comparison, Visa ticks over around 1,500 tps, and can burst to 50-60 thousand tps on mad shopping days like Black Friday. As Radix isn’t a blockchain there’s no mining, so there isn’t the colossal energy costs to run the network as with the usual suspects.
And all this is slowing down the industry’s development?
Well, it’s just not enabling certain things to take place.
Well, two of my personal favourites is a DEX (DEcentralised eXchange), and Decentralised Debit Cards. The Radix protocol supports both. Just Google “radix pos” to see a live demo a friend of mine videoed to get an idea of how much potential our platform has. In an ideal world you want real time settlements, if you can get them – you want it instant, and you want it irreversible (immutable). I’m all about on-ledger, on-chain in old english. I’m not saying it has to be done that way, I’m just saying, if there’s a choice of doing it ‘the right way’, that’s obviously preferable because it’s clean, it’s elegant, and it’s the way Satoshi envisaged it from the beginning. So, that’s scalability
Another huge issue right now is speed/ throughput: approximately 10 minutes per block on Bitcoin’s block chain, 2.5 minutes on Litecoin’s, 15 seconds on Ethereum’s, and none of those are fully confirmed transactions (immutable). The Radix protocol achieves full immutable finality in <5 seconds, but typically 0.2 of a second, so it’s absolutely next level.
You describe yourself as an alternative to Blockchains & DAGs. Could you explain how Radix’s technology differs from those? And also, what are the advantages of your platform?
It might sound cliché, but our protocol isn’t like anything you’ve seen before. For example, our consensus mechanism, Tempo, was inspired by science, specifically Special Relativity, and is totally unique. In order to design and build this, Dan’s borrowed wisdom from geniuses, past and present. Thanks to Leslie Lamport’s work, we can order events, so we know exactly when things took place chronologically. What that means is if you placed a trade in London (the Fintech World Capital), with one party in Auckland, and the other in Zürich, you’ll know exactly who executed the trade first, regardless of the number of hops in the internet to reach the deal desk in London. Our system knows which broker clicked first. Tempo is extremely efficient, fantastically fast, and totally transparent.
Basically, the adage is, ‘all blockchains are DLTs, not all DLTs are blockchains.’ I like to think of DLT architecture as being the next version of blockchain, whether that’s 2.0, 3.0, … There’s a good analogy to think of traditional block chains as vertical bricks, it gets a bit unstable (bloated) the higher you go. Dan chose a horizontally sharded architecture from the very beginning, which enables massive scalability from inception.
There’s an unfortunate phenomena in block chain once you get a really big network, and/or really big blocks. It’s called ‘block-thrashing’, which is when you can’t sync all the blocks across the network quick enough before the next block is produced. Block-thrashing, ‘speed of light’, CAP theorem; it just doesn’t work, it falls over, and that’s exactly what Dan predicted. So, we’re not using blocks, and that’s a fundamental difference.
How does your token-system work?
The Radix token, is called a rad, and its ticker is XRD. It benefits from a dynamic money supply model, similar to central banks, but without the bankers! In terms of token-economics, with our platform, we create the tokens and we also burn the tokens, so when the market wants more, we create them, when the market’s selling, we burn them. There’s a stable token element as well, we’ve got the decentralised debit card as I’ve mentioned, you can create assets on the platform. Basically, what ever the current tech has, we have, and a lot more besides. But I feel it’s unrealistic to launch everything on day one, because we don’t want anything to break, and Dan is a perfectionist!
How do you make money?
There’s multiple ways. One of them is by earning a fraction of our fixed one cent transaction fee, so, effectively dust, but cumulatively, over billions of transactions, it’s going to pay the foundation, the entity, a requital. Another one is white-label solutions. Samsung will roll out 100 hundred million smart fridges, and they’ll need a low-cost, fast, scalable, secure network to run that. The legacy blockchain technology is too slow. Can you imagine if they chose Bitcoin or Ethereum, processing 5 tps for 100,000,000 devices? By licensing the Radix protocol they could run it in-house. And of course there’s bespoke solutions, for blue-chip multinationals, who demand the best-of-the-best, no compromises. •