Andrea Bonaceto: How Blockchain can disrupt cloud computing – BlockchainCruise2019



so I'm going to talk about cloud computing I mean let's keep interactive I'm too boring stop me ask me questions anytime a quick intro about myself first and the rest of the team I'm the founding partner and CEO at Hana capital which is investment fund investing in blockchain projects at the very early stage we invest in both token and equities you can find all our investments on our website at ana capital calm before atomic avatar I used to run my own company and my three colleagues used to work for Blackrock in London I think for us the point is always how do we add value when we basically take investment decisions and one important element is for sure research ensuring that we really know what we're talking about we research on the verticals we thinks are more relevant and the cloud computing is one of them we think there is a lot of room for blockchain to disrupt cloud computing and the presentation I'm gonna show you today is basically a subset of a research paper from our head of research Mattia if you're interested in the full research paper you can just google atomic avatar cloud computing you will find quite long medium post and there you can find all the details about it but let's start now with the presentation so the way I broke it up is as follows so the first part is just about giving you a snapshot of the current market and cloud computing in the future how's it gonna look in the face of more data being produced globally and then saying okay can we actually use a decentralized approach to cloud computing and then explore a few solutions on the blockchain space before I start does anyone know what cloud computing is does anyone want to give a definition like an example like what is an example of a cloud buting application is anyone brave enough to provide an example sorry mining but like for me like the most easy example is for instance Gmail right you're not hosting the email Gmail on your own server if you go to Gmail you then also have many other services you can use you have G drives which basically Excel on the cloud and yeah the idea is that you don't host the operations on your own server on your own laptop but is in the cloud and if you see out the cloud computing market looks like at the moment is dominated by a few key players being Amazon Microsoft and Google mostly Amazon with Amazon Web Services has around 33% of the market and is a sector that is really growing very fast in by 2021 is expected to have 300 billion in global revenue per year and in 2017 we were in situation where we had 17 billion per quarter so it's growing exponentially but as I said is dominated by large corporations then what's happening these corporations they see that oh it's so popular and there are so many things you can do with cloud computing so what's happening is they are making existing products relatively complex they are deploying many new features Amazon Web Services and Microsoft they're releasing 40 to 50 new cloud features every month but what actually organizations do in the end they only use a handful of those features so by 2020 is a sector which is expecting to triple even in terms of number of providers but existing solutions are getting quite complex now this is a research from Gartner that points out what are the main risks of cloud computing the first of all cloud computing is emerging as one of the main risks for corporates and the main concerns are around security because if you have information and the computing power on the cloud then you need to grant access to a third party to access that so there might be security breaches then as I mentioned before the infrastructure complexity is increasing and that's not something which is helpful and as well you know cloud providers they should be careful about things like downtime like if the server goes down then you cannot access what everyone access this is a problem and then other concerns as well Twilight is in the context of the new regulation on data the privacy like the GDP artists called GDP are the may be concerns since cloud providers sometimes may fail to meet the GDP our legal needs and then as well as I mentioned like the risk of data loss in case these servers are hacked and then as well one problem is if you have in the end a central organization like Amazon Google Microsoft running the servers you are at risk of that organization modifying your data or changing something and it's nice now to bring a more like blockchain / crypto anecdote I was reading an interview of a Vitalik booter in the founder of and the creator of aetherium that was saying one of the motivations start thinking about decentralized applications was that it was playing World of Warcraft it was a big fan of water water and one of his main characters had his features altered by the company that was basically providing the game she was like why right they basically decided I'd be trying to do that but in context where this is on a decentralized governance that will not be possible so that's something to bear in mind as well when we have these kind of central organization managing such important tasks then second part is about the future how the future is going to look from a data standpoint what we see is that we're gonna have avalanche of data produced in the future more and more just to give you a interesting piece of information 90% of all the data produced by humanity since the Big Bang until now has been produced over the last two years so this shows you the rate at which data is growing and now with the Internet of Things things like self-driving cars will have exponential growth of data production just think that for self-driving cars a self-driving car can produce up to one gigabyte of data per second so in this context of having an enormous amount of data available you need to find smart ways to deal with such data the thing is the mean question is in this context how can a centralized cloud infrastructure support that level of computing power needed and at the same time ensure that is still scalable and there are say the risks of hacking and compromising the data is minimized then what you can think about is to say okay we move from having everything on our own servers and laptops in the clouds now let's try to maybe think about a decentralized approach towards operating data in the clouds what see what is happening now is that on cloud computing many of the computations are getting performed on the so called edge devices so devices that are closer to the end-user for instance even example or routers so the idea is that you don't do the entire computation in you know one massive cloud but you like delegate some tasks to these hatch devices and this makes everything more secure and makes everything even more scalable now here to just give the level of how the opportunity for hatch computing is just look at this graph so it's showing the usable data created per year versus the data center traffic so on the bottom line you have the data center traffic the data are intense of zettabytes once data bodies one trillion gigabytes and you see that there is a massive gap between the usable data KD per year and the data managed by data center meaning that there is a lot of data usable like in 2021 you have 85 there but the traffic is forecast to be only 21 so there is a big gap that is not at rest unless you actually do the right steps from a technological standpoint and then the realities that having sharing computing power is not something new it's something that in the past has been used already here is an example of sati home that was a scientific experiment at the University of Berkeley they were trying to interconnect computers to search for extraterrestrial activities here the problem is you had it acknowledged back then to do it but the concerns were is still something that is centralized and this has security pitfalls of course and the main point is there was a lack of incentivization plants was like a peer to peer situation like you know BitTorrent let's say it worked fine but you did not have a strong incentives for actors to provide value to the network and then the problem was also about the lack of verifiability of the correct performed computation so there was no check at that point so the idea is okay that's something that was used can we now go my step further and see how a blockchain can help bring this technology to the next level yeah I think we can and there are several examples that are trying to do that one of the main that see the main benefits of blockchain of packing blockchain into it is that first of all you allow a true decentralized system that will make everything more secure because of course if you want to hack that you don't know where to start from you don't know where these servers are located and as well from from incentivization standpoint you do have tokens native crypto currencies that they serve to incentivize the various players in the network so again to summarize like what are the main challenges of the cloud solutions even if you want to use blockchain so first of all is fine we can have incentivization in place what you need to ensure that the incentives are structured in a proper way right there are many ways many you can be very creative in from the point of view of which consensus you want to use but you need to ensure that it's the right one for the kind of application that you want to deploy and then one key part is to make it scalable we have seen many blockchain solutions being very interesting but the main bottleneck of the technology is to ensure that they are scalable secure and decentralized so the so called the blockchain trilemma is actually solved and then as well if you want to verify the computation you need to ensure that this is done in a proper manner to ensure that attacks are malicious attacks are avoided and then as well another element is about these so called Oracle's so whoever if you have a system that connects the blockchain to the real world whoever inputs the information in the block should be something someone trusted because that's something that is difficult to decentralize and again you need also to manage the risk I mean this is like in some cases you can have that in case you know there are attacks and the Sun blockchain might also have the capabilities to revert some of the past transactions need to ensure what is appropriate based on what you are doing now here we are going into a few applications that are quite interesting in my opinion as a disclaimer we did invest as eternal capital in one of them Definity but we I mean I'll go fast on that because they are actually quite complex if you go into all the details so if you have any questions feel free to ask me as well later on or you know feel free to go and read the entire white paper but I'll try to basically tell you the peculiarities what they have different one from another but in the end they all try to solve the same problem so bringing cloud computing on the blockchain and decentralizing it so the first is anchor network the approach they have towards cloud computing is to say okay fine you have an edge device cool you can all connect and you can share together the unused capacity so you can sort of create like a marketplace like a shining economy marketplace for excess of computing power and they then said okay one very complex thing to do in cloud computing if you use blockchain is to create a saccade virtual machine so some projects what they say is okay let's bring the entire cloud computing on the blockchain and create a sort of supercomputer and then we just have very minimal hardware to connect to this supercomputer what anchor is think is saying okay look let's not do that let's just have these small providers they connect to each other and then let's just make digitized like one part of the process to ensure that we have like different clusters and those are links to the edge devices and we don't like we just deal with each of them in a separate way it's like a divide and conquer approach they have also designed the consensus mechanism called trusted proof of work it's a useful proof of work which is let's say an improvement compared to the consensus magnets used by Bitcoin just called proof of work and I mean they're currently developing their solution so we'd see if they'll manage to succeed the other project is quite interesting is Definity as I mentioned as a disclaimer we have invested them other funds as well I have invested such as poly chain capital 1/16 which is the crypto branch of understand Horowitz is actually one of the main investments and what's Definity tries to do is to say ok let's actually try to do things the difficult way let's create this virtual machine this supercomputer and then let's try to everyone to connect in the supercomputer that is basically running all the applications all the software that exists so it's a very ambitious project again they are still currently developing it you might have heard that in the dissent that in the these autonomous organizations sometimes you know are governed by smart contacts and we hear caught it code is law right they're governed by code for Definity the rule is AI is law so is governed by AI is a very complex infrastructure where there is an AI this governing everything transactions themselves sometimes can be retrieved if the AI thinks that this should be you guys can check out all the details and then another one that I wanted to analyze as well is Solana Solana is quite interesting because they have defined the new consensus mechanism called proof history through these consensus mechanism they basically managed to have the definition of time embedded into cloud computing like the amount of data that's been processed a parallel that you can use to understand that is a water clock so it's like to calculate time like how many seconds have passed you have water pouring into a clock and then you're like okay when it goes at level one I know that one minute has passed and goes to eleven to two minutes has passed and so on so that is that think about now the water is the data processed by certain provider so they basically are able to see the amount of data that is produced when is produced and the entire consensus is around that and by using these new consensus mechanisms they manage to create a blogging platform that is very scalable and we'll see what this approach will add so these are all projects quite new they are now in development it's interesting to see which one will succeed to what extent where they will succeed but the key takeaway for me is that blockchain is aligned with the Big Data of revolution that we are going to witness we are witnessing now and it's just gonna increase over the next few years we to find an effective way to manage and process the data and centralized servers have their own limitations you need to have a decentralized approach and blockchain is pretty much solving the issue of giving the right incentives to people to participate because for sure like you can have just peer-to-peer platforms and people that are just voluntarily participating into that because it's good because like it's a good cause but in the end if you also create the right incentives you can ensure that everyone has the skin in the game and reason join and to participate into the network so we're very excited to see how these will unfold over the next few years I think these technologies are still at the very early stage but they're very promising and as an investment fund what we do we tend to basically see the different clusters we consider interesting and then take a deep dive into it and and then look at the interesting projects that so that's pretty much it about my overview on cloud computing here are my details if you guys wanna email me any questions on this presentation or you have interesting blockchain projects you wanna share with me feel free to do that you can follow me as well on Twitter on the right you see all the contacts for etana capital you

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