How High Will Bitcoin Go? Here's the Better Question | Flare, Hugo Philion

Intro

00:00too many of the same projects doing the same thing just about money just about Finance I think myself and my team wish we didn't have to be associated with most of the people in the industry what you see when you go to conferences most of what people are talking about is either nonon or incredibly dull development dollars could have been better spent on improving the technology blockchains need the ability to handle much more data and more computation this means that people can build rules that say you wanted to create a truly uncensorable Twitter a way to do this

00:33would be using a blockchain but you couldn't handle all of the users and data so you need to take that do that computation somewhere else if I could Truly find the score of a two-player matchup I can create a betting Market between the world's largest Gamers people started using Bitcoin in places like Venezuela to hedge out insane inflation there's not too much you want to do actually on the blockchain there's not too much you can do on the blockchain hi my name is Hugo fillian and a co- and CEO of flair Flair really is the only blockchain which we describe

01:04as third generation it enshrines data directly into the chain first generation being Bitcoin simple transactions second generation being ethereum adding logic to those transactions third generation flare adding data to the logic has just hit about a million wallet 100 to 150,000 daily active users so they're bringing value from other blockchain ecosystems to flare to be used on flare with the data provision services that are provided by FL within the blockchain environment you shouldn't be doing anything based on trust because you don't know the counterparty and you

01:36don't have any legal recourse essentially what defi is doing today is it's using a trust-based model which is very similar to trafi except is that trafy are bound by laws whereas an oracle provider has no laws in order for defi or any other application that relies on data to be valid you need to have a way to secure those oracles that is clear open and provides a similar sort of safety as the blockchain itself we think the best way to do that is to put the oracles fundamentally into the chain bring defi actually

Why Blockchain, For What?

02:14decentralized I grew up in London which is pretty much the world's Financial Center at the time when I was growing up very small startup Community very little technology Community the financial markets were the only choice and obviously a place where one could potentially make large amounts of money which is very interesting to think about when you're 17 I suppose the macroeconomic and that's always been a things I like to think about so I studied risk and financial engineering worked at a number of hedge funds in London after about 7 years I decided that I was just trying to eek out

02:48Financial returns in order to make uh essentially myself richer so I left Finance went studying machine learning at UCL in London and that's where I met my two co-founders and I knew knew I probably wanted to be a founder and when looking at machine learning it's heavily dominated by very large companies and therefore gives you no opportunity really if you look at open AI he ran y combinator I certainly didn't have anywhere near his Network to do anything in machine learning one of our co-founders had built inter vehicle Communications based on a distributed

03:23Network like Bitcoin and I'd had some exposure to blockchain from people I knew in the financial Community ultimately it was a very interesting idea to me that we could do everything especially Financial things without having to care about the counterparty and I think that was one of the fundamental reasons why blockchain at the time and still does promising technology so we started flare in 2018 and we had a very small office in the basement someone's photography studio but as we were a team of three I think one and a half desks at the time they didn't enjoy the benefit on ethereum of

03:59smart contract essentially the largest source of Bitcoin was know as wrapped Bitcoin which is managed through a custodian essentially antithetical to the concept of Bitcoin meaning you're relying on a middleman in order to use your Bitcoin on a smart contract platform we started looking at okay well how can we get the data around Bitcoin we devised the protocols to be able to get that data from Bitcoin to build a bridge that is over collateralized meaning it has more value securing it than than the amount of Bitcoin that has been bridged using that bridge and in

04:33order to do that we needed price so we ended up with these two data protocols the first being a protocol that allows you to quickly and securely get data from another blockchain and also to be able to prove that a particular thing hasn't happened on that blockchain and that's pretty

This is True Potential of Decentralized Data

04:52key so originally we designed the data protocol just to be able to build this bridge for Bitcoin ultimately we very quickly realize that there those data Protocols are much more interesting that we could bring in data from any open system pretty much any system in a decentralized way that's the key point it's decentralized and it has security so this allows you to do everything you can do in defi today but with Flare that's just the first step what really interests me is then okay what can we build with that this means that people can build rules of an application

05:21they're building second aspect is then for us off chain compute far more data from other sources than can be used by the chain so where are you going to use that very very large amounts of data that you need to be able to use that off chain in order to build applications so I think the blockchain today is at the limit more or less of what can be built until you add in further compute and that's when we can start building applications that people actually want to use so for me the first and most interesting thing to do is genuinely decentralize and make uncensorable

05:51social media or news platforms or video platforms we see an increasing set of issues in the world where there is very High censorship where people are struggling to express their opinion another set of application is around gaming ultimately the experience the blockchain has offered to gaming has been so inferior to the web 2 or existing gaming product it really hasn't taken a tool but there are interesting things you can do when you essentially financialized components around gaming if I can truly understand what has happened at in each computational step

06:26of a game then I can give people skins I can give people asset based on exactly what they've done and those assets can be real and tradable as opposed to Simply ingame I do have a third thing there suppose the last area that really interests us as a team uh is probably machine learning or as most people call it artificial intelligent there are some very interesting things you can do with distribution of users again there's a there's not too much you want to do actually on the blockchain there's not too much you can do on the blockchain I suppos the decentralized and

06:59economically secure substrate of a blockchain provides a very interesting place for machine learning to be expanded and to be made safer through having multiple

A New Data Ecosystem, With Blockchain 3.0

07:15participants some people may believe that Bitcoin shouldn't have value and I understand that mentality you have to differentiate between the technology and the value it has some logic to it Bitcoin is only backed by hashing power in it's not by the ability to Levy taxes nor is it backed by the ability to force other people to use your medium of exchange Bitcoin doesn't have either of those two things but perhaps it has one other thing rather than forcing people to use your medium of exchange but to get them to voluntarily use it and that's interesting but you'll never

07:48convinc people that don't want to be convinced especially as an awful lot of people have a reason a financial reason not to be convinced about that thing if you take away the it's a monetary asset side of the equation it's fairly nent technology I think being able to distribute computation and consensus will become more and more useful over time essentially there is value in being able to come to consensus cross some item of data across various different vertical you know our biggest space the space we're most interested in researching thinking about is around the

08:23outputs of machine learning models probably provides the answer to what is blockchain useful for my exposure to finance was really post the large financial crisis the ideas around what something is worth fall apart when currency is printed people were making trades based on an expectation of government action rather than based on any fundamental strength in the economy the sort of large excess of capital that was put into the markets host the GFC really led to a position where where valuations were massively out of whack and so when you spend your days thinking

09:03about the idea of taking the fundamental thing that values assets is a very interesting thing because it removes that ability of a group of people to pervert essentially the entire transmission mechanisms of all financial markets and that's what has happened the idea that could be a technology that removes that from the equation is very very appealing people started using Bitcoin in places like Venezuela to hedge out insane inflation that was collapsing their currency crypto broadly has solved the question of how can I move dollars across the world really quickly and easily without having to

09:42enter an iban the defi that is built fundamentally around essentially a dollar based stable coin system and Native tokens because that's essentially what defi is and I think that could expand as people use crypto tokens more whether it be stable coins or the native so if we're lucky flare will be one of the key components in how people use data on blockchains that's what we're building that's essentially where we're going we're not a smart contract project focused on Ripple we have a much much larger ambition and that ambition revolves around data and offchain comput

10:19so in 5 years time I'd like to see a non-trivial percentage of the data that is used in blockchain being sourced from Flair regardless of whether it's being used on flare as a chain or whether it's being used on ethereum or any other new chain that comes up success to me would be that the data came from flare moved from flare in 5 years it's feasible that our offchain compute strategy could result in applications that go Way Beyond defi Way Beyond having value for speculative reasons and much more involved in people's daytoday lives because it's a valuable application in and of itself for