The Founder and CEO of Input-Output Hong Kong [IOHK], Charles Hoskinson was recently interviewed by Sunny Aggarwal on Epicentre earlier this week where they spoke about the emergence and distinction between Ethereum and Cardano.
An idea that led to Ethereum’s [ETH] birth:
Cryptocurrencies come in new phases/stages/generations and every time they come, they tend to introduce a collection of new concepts. Bitcoin came without trying to be money or a payment system. It was much simpler, a collective delusion of a problem with a goal to convince people that these magic internet tokens somehow backed by math are actually worth real money, so we can buy, sell and trade them.
It took a few years to settle and the turning point was the year 2013 when people realized Bitcoin’s potential. Right after they realized that this is just a pushover system that’s really slow, really expensive and not very user-friendly. The question in every investor’s mind probably was, I want to do more with it, can I?
The current CEO and founder of IOHK, the Co-Founder of Ethereum previously, Charles Hoskinson said this is when they had a grand conversation on how to augment it as they saw color coins, master coins, etc.
At the end of the day programmability matters, so Vitalik and himself together created Ethereum with a goal to run control over these sub-protocols that run on a blockchain to the developer and give them an easy way of doing the same.
He admits on a lighter note that:
“A lot of people thought we are crazy in fact, they still think Ethereum is crazy and a lot of people also think Bitcoin is crazy and this is fair too.”
Ethereum comes out as the next big generation and they have introduced notion smart contracts with more complex computations in the transactions and all emerging structures that can be built from it. Now that the generation is done, people seem to agree it’s a good idea that there are a lot of competitors like NEO, EOS, and others that are coming out or are already in the market, says the Co-Founder.
The 2015 idea for Cardano project and another nutshell:
“we are now entering a third generation where the delusion is good and we like that, computation is probably a pretty good idea.”
But, he came across two problems:
- How can these be done on a scale of millions and billions of users if they are actually going to be useful for people?
- There are going to be hundreds to thousands of cryptocurrencies in the long term and probably the world will not see the great Cambrian extinction where all these currencies are lost.
“It is difficult to agree or consolidate on one thing and something as controversial as money or financial life is probably not going to consolidate around just one universal standard.”
As a consequence, Charles believes, interoperability is necessary. It is important to be able to move data and value and preserve certain things like security and privacy as one traverses the internet of value.
He illustrates the evolution:
“we move beyond a couple of nerds who meetup and enjoy talking to each other over slack to an actual system which has millions to billions of users and has control over financial life and all the facets of that maybe, including identity and property of a user.”
He believes that a sort of democracy is needed to decide where the system is going. Whether that is meta to the system – meta consensus, or is it embedded within an existing government or built on the blockchain, there is a lot of debate about that. These are the 3 design criteria required for next generation of any cryptocurrency.
He coined it as:
“Keep what we know, keep what we love, keep the collective delusion, keep it weird, keep the computation, that’s pretty cool. But then also go ahead and move into a domain where you get faster as you get more users. You can talk to all the different cryptocurrencies. Have some way of sorting out who pays and who decides.”
He stated these were the business requirements at a super high level. They had spent the first two years carefully structuring the technologies. They started tons of different threads like better consensus algorithms, consent on voting threads, better cryptocurrency primitives, threads involving side chains and so forth.
The first version of this came out in September last year, which kind of runs like Ripple, a walk delegation version of Ouroboros. He says that it is a lot simpler than the papers recently published by them and over time they are just going to decentralize the system furthermore with add-on side chain components that can link their smart contracts layer. This will be coming in the next few months to years depending on the features, concluded the Founder.
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