There are a lot of ideas in my mind about what it is that we can do next year. Developing some of those products, like bridges, making Polkadot as good as it can be. Parachains launching on Polkadot is the fifth and final stage of Polkadot's launch. This represents the end of our initial journey of delivering what we'd set out in the Polkadot paper back in late 2016. So five years of hard work. If you think about a current blockchain networks, they kind of operate in their own silos like bitcoin is their own, Ethereum is their own, and they don't talk to each other very much. Polkadot is more like the internet of blockchains. Everybody can communicate with each other in a meaningful way. Polkadot has taken the leading position as a contender to Ethereum, but also as a leading contender to simply connect everything. The growth that we've seen in kind of the community around our project has been amazing. Obviously part of that is just because we're part of Polkadot. I think it's that feeling of community. It's kind of the size and kind of activity levels. This is the first fully sharded blockchain. This is a chain that can host domain specific applications and allow them to interoperate and to communicate. Parachains auctions and parachain crowdloans are the beginnings of what we can do with what we've delivered and indeed what other teams can do with what we delivered. We had a very media centric community plan, which was we'll have meetups in a bunch of different cities. Anybody wants to come can join. So Polkadot takes a different approach by letting chains pool their security. And after a while, these meetups transitioned into Parity and friends, so there are different teams from the ecosystem presenting, you know what they're doing instead. We actually started using Substrate as a framework even before I think the Polkadot repo starts to be active. By us focussing on the core technologies, we've been able to attract all of the best blockchain builders to dedicate their platform, their business on the Substrate-Polkadot technology. There are, you know, hundreds of builders right now, different teams looking to build and get a parachain on Polkadot or even Kusama. When we started to build on Polkadot, it is the Web3 Foundation that encouraged us to go for grants and support us to build Acala. We literally delivered our first testnet after three months of building. This is a test network with 1300 community run nodes. It took us another few months to actually get it production ready but you can already see how this is going to speed up the innovation in this space. Right now there's a lot of constraint building inside a virtual machine and then moving onto Polkadot you can build a full blockchain, you can customize the economic policies, for example. That actually makes a lot of things that weren't possible today possible. I had been very pleased with both my investments in bitcoin and my investments in Ethereum and by the time Polkadot's story started to be shared, it was very clear that in some ways blockchain would look like websites that there would be many, many blockchains and that by being so discrete and unrelated and not connected, a lot of opportunity would be missed. And so the interconnected, interoperability, thinking and thesis behind Polkadot really appealed to me. This is a grassroots movement. This is a large number of developers, who are really talented in their own right, coming together and each making the decision that Polkadot is the right ecosystem for that. And I think Polkadot now has the most projects being built on it after three years of any protocol so far today. It was a pretty significant number of developers that were familiar with this Ethereum technology stack. You know, I started to say, OK, like we can take like, you know, the best of that world and marry it with like the, you know, security and kind of networking. And you know this and the power substrate that's in Polkadot, you know, that would be a powerful combination. It wasn't even that long ago that, you know, chain rule the day, right? I mean, you kind of as a developer, you chose like one chain and that was your home, right? You would deploy there and that was it. And so I think what's happened, you know, is that this thinking has really changed. You might have a project, you know, that could have started on Ethereum, but now they're saying, you know what? 'We're going to take like kind of our same implementation and deploy, you know, into multiple remote destinations.'. We've engaged with a whole bunch of people at this point in terms of building and deploying to Moonbeam. Moonbeam can provide this kind of, let's call it like an easy starting environment where people can test like their ideas and find product market fit. And then it could be that, you know, once they kind of find that that there's an upgrade path, right? They can kind of grow into a full parachain. If we can be the kind of on ramp, that on boards these developers but then, you know, ultimately they, you know, get substantial enough where they want to have their own parachain then we will consider that a great success. I think it was two or three years ago at that time Gavin came to Japan, and he presented the idea of Polkadot. I realized that Polkadot is going to be the foundation of the next Web3. That's why I decided to join Polkadot space. I am with one of first Polkadot ambassador. I think we are one of first teams who joined the Polkadot ecosystem. Since the Polkadot relay chain does not support smart contract all people in the ecosystem need at least one parachain, which supports smart contract very well. A lot of people has already made dApps that's on Ethereum, and they can use exactly the same contract on the top of Astar Network. And when it comes to a smart contract hub scalability will be obviously a problem.
So substrate is a customisable blockchain so we are making ZK rollup pallet, substrate pallet, and the user can import this pallet so that they can migrate from Ethereum to Polkadot without compromising, without sacrificing rollup contracts. The fact that the parachains are made of the same stuff, they are both made of substrate, our framework for building blockchains, means that any improvements that are created for one of these parachains can very easily be folded back in on the relay chain level, on the Polkadot level. And then, of course out to other parachains. So it allows this incredible level of innovation. I think a very important notion is the idea of comparative advantage. Where you have one chain, which is very good at a specific thing, and that interoperate with another chain, that's very good a specific thing, and then you can build an application that leverages both of them to create something even even more efficient. The old thinking is always like, OK, if I want smart contracts, I need to put those into like my platform itself. Well, I don't know, maybe there's a way where you might have smart contract needs on your parachains. Maybe you can outsource that. It's like the way the software is structured forces the collaboration paths between the different teams and then by being cohesive and close I think then you get this net effect of like the whole is greater than the sum of its parts. I think the goal is 100 parachains. We can see 100 different sort of like layer one blockchains. And then on top of that, if we see 100 different applications, like useful applications, that can all compose and leverage off each other, then you are looking at ten thousand different innovative applications. Polkadot is really seen as one off the top public blockchain in China. The number of the community, the number of the project in the ecosystem as compared to other blockchain is doing a lot better. One thing that really stands out to me for Polkadot is the on chain governance aspect of it, where there's a council, a technical committee and any DOT holder has a say in the direction of the the protocol. And you can vote and there's referenda and it's all on chain, it's all transparent. Any community member who's a DOT holder can both vote on governance proposals and can submit proposals, including Treasury proposals. Whenever a valid author is a block and gets a reward, some amount of that reward is diverted into the Treasury, so the Treasury grows over time. But it also shrinks over time so there's a periodic burn of the funds within the Treasury, some proportion of them, which is intended to incentivize spending by the governance systems. That's a use it or lose it kind of mechanism. As of November 2021, I think on Polkadot network, we have more than 20 million DOT tokens ready to be spent by the community, and we're looking for developers and teams who are willing to come and develop for the Polkadot ecosystem. The Treasury has two main goals. The first one is provide added value to the ecosystem. The second one is help in mass adoption. Things like training people, teaching them to use substrate to build on Polkadot to understand the concepts. Funding research, you know, taking professors and academics and having them work on their favourite problems in the context of Polkadot. Showing people how they can use these types of apps to just improve their lives, maybe for sending things like remittances, to understand how this is going to affect them in their daily life. When you look at the changing of the industry right now in the direction of Industry 4.0, it looks very much like industry needs machine identity. They actually do want it fully decentralized because they want to have a trustless system. They don't want a system where you have two or three big companies, which owns the validity of all the credentials because this is dangerous to them. We just started a really, really cool project funded by the German government to bring identity to smart metres. They need a little bit more than an identifier because they have certain capabilities. For example, if you have a solar roof with six kilowatt peak, then the smart metre should actually be able to talk to the grid and say, who's connecting when and who's connecting with which capability. Then you have a much better chance to balance out the grid. Yeah, and this is really IoT device because this Raspberry Pi can actually run a node, as we noticed. So it's actually helping the environment in a very nice way and it's also saving costs. And it's also using the grid infrastructure better than it was used before. When you produce something, an IoT device, then you have to attach like four credentials to that, and all those credentials cost like 25 dollars each because the Ethereum gas price is up today. Then this is an unpredictable production cost. This is a no go for everyone in the industry. On the one side, you need the truth in the system from the decentralized system, and on the other side, you need a predictable price and I think Polkadot is the only technology that solves that dilemma. If this really rolls out then many people out there will actually have a KILT node in their apartment and we would love that. The biggest outcomes from the blockchain, the most exciting stuff are going to be the categories of business that have never existed because they couldn't and now they can, because blockchain technology was the missing piece. And so now that we have that piece for the billions of creative minds out there to come up with a handful of businesses where when you see them, you say, 'Holy shit, I never thought about that'. But then you can't unsee it, you can't stop thinking about it. You can't unimagine a world without them once you hear about those ideas. Are we at a place where we actually think that we will be able to build potentially a new way of transacting digitally in our lifetime? Well, one of my goals with Polkadot is to remove the need for the mainstream adopters to use crypto at all. This is something that's dramatically different between Polkadot and the smart contract model that we saw, that was introduced with Ethereum. And it's not simply because of the scalability problem, but it's also because users have to hold Ether. They have to hold this crypto. So with Polkadot, the applications buy almost like a job lot of consensus bandwidth... Polkadot is unique in providing economic freedom for its applications. The application has already paid for its parachain. While it has the lease, it has, how ever long, two years, potentially on Polkadot, of free, decentralized, secure compute capacity. It can, if it wants, make exactly the same decisions that are made every microsecond at platforms like Twitter, Facebook and Google when they decide when a new request comes in, whether they want to serve it or not. It never needs to be done with DOT tokens, and it doesn't necessarily need to be done with the application tokens. The application might have all sorts of other ways of deciding. For example, every user that has a valid Facebook account with more than six months old can use your application. Every user that has a decentralized identity sorted can use your application. And this allows you to onboard users without having to get them to buy in on your tokens. That allows you to have this breakout application where users don't need to know or care that it's based on blockchain or cryptocurrency. That allows you to open it up to the world.
