EB46 – Shawn Wilkinson: Storj and the Decentralization of the Cloud

Transcript

and we're live awesome all right so uh epicenter Bitcoin episode 46 in 5 4 three hello welcome to epicenter Bitcoin the show which talks about the Technologies projects and startups driving decentralization and the global cryptocurrency Revolution my name is Sebastian K and I'm Brian fman Crane and today we have with us Sean Wilkinson he's the founder and lead developer of storage so written storage J um we've talked about decentralized applications a bunch of times in this show uh we've had ethereum on twice or just recently we had coinify with Tom ding where we

talked about this first time we're actually having someone in charge of a decentralized application on and I'm super excited that we have the chance to kind of dive deep into to an example of that and hopefully we'll also get your understanding bit better actually the the promise of decentralized applications in general so hey Sean it's good meeting you hello so started first uh here to talk all about storage and uh where do you want to start so actually what we thought would be interesting uh would be to hear a bit about your background U before we get start uh kind of di into storage so can

you tell us how did you get into Bitcoin and how did that lead to ending up in storage sure sure so I started with Bitcoin about 2012 uh I had a friend that was mining so that's a cool thing I'm not using my GPU for anything else so I started mining as well a nice little 6950 then I said eh that's making my room too hot it's making all this noise so I stopped mining and then Bitcoin kind of gained a little traction I came back and looked at it said H this is actually a pretty interesting concept uh so about 2013 I get inv involved in Bitcoin core development started building up some of

my own Bitcoin projects doing a little bit of freelancing and then I ended up working for bitshares about the end of 2013 beginning of 2014 uh and then I left from there and started working on storage so my own uh decentralized cloud storage platform that kind of Incorporated all this Bitcoin stuff all this blockchain technology into an existing ecosystem got back traditional background in CS so I got my bachelor's in computer science from warhouse college uh this year so I kind of look at Bitcoin and the blockchain is simply tools that you can use for other platforms and other things and that's

where they kind of to get kind of came together to build storage so you're best in Atlanta right that is correct that is correct we have down Bitcoin magazine Camp BX so I understand just got back from a from a little trip in in Las Vegas where you were attending a couple of different conferences indeed I did a triple conference I went first to the coins in the Kingdom in Orlando then I went to coin agenda well I caught the edge of inside Bitcoins uh and then I went to coin agenda then I went to asers United so uh those were all in vacas so just got back today actually I got back from the airport a few hours ago and uh ready to get back to work

awesome all right so where do you want to go next uh I guess maybe a brief overview of storage and what it does yeah tell us about storage and and perhaps about the company as well sure sure so storage is a decentralized cloud storage platform basically what that means is we want to build a file storage Network where you can store your files your videos your pictures or whatnot on this network that is doesn't have any Central controls like a company like Dropbox or Google drive because when you once you start getting to centralized companies that manage your data you you hope they would be a good Steward for that data but uh it turns out there's

all these different privacy and security problems uh there's you know a the case where they give access uh to the government to produ through your files like Dropbox um we saw that with kind of the prism leaks and the prism information and number two there's just like security breaches so they just failed to to protect the the file so we saw what the other day day or two ago that Snapchat uh a third party application through snapchat got hacked and so all these photos and and media uh got exposed so the idea is that if we remove the company control we remove that Central Point and only give uh the users access to the file so they only

have the passwords to those files and not a company or no nobody in between then it's a lot more secure and private the other thing is since this is a network a peer-to-peer Network that's made up of users we essentially instead of having uh Central server Farm or a central server Central company we actually have the users contribute space to the network and so they can earn money they can earn cryptocurrency for doing that so it's really about building a cloud built by and for the users where they can control it rather than a company or a centralized entity uh so we think that's a lot more efficient system it's faster it's cheaper it's more private more secure uh

so that's a a general sum it sort of sounds similar to the promise of Bitcoin So when you say that you know centralization essentially is is the issue with with cloud storage it's a lot of the same problem problems that we experience in the financial sector right so uh a lot of that overlaps the storage space I guess right right so yeah you have Bitcoin whose value proposition and say okay here is a medium of exchange a currency that is not controlled by any Central Bank so they can't print it off uh or whatnot for storage you know you have a value proposition along the same lines where okay it's a storage network uh where you have controll of your files

not a company and so that there's a whole bunch of other things that come with that that that really make it stand secure so um why do you why do you think that uh storage and cloud storage lends itself of so much the decentralization is it that it makes available those resources for the first time do you think it's the efficiency it's the trust um can you go into this a bit sure it it's all of those things really I mean you could simply sell it on feature sets alone so

think about Amazon S3 a large large large uh Cloud computer and and storage interface for the entire internet and they'll have a switch failure and a quarter of the internet will go down because Amazon web services down so you know people are losing money they aren't so happy versus you look at Bitcoin when has it gone down in the past five years you know the numbers on that can you guess probably none probably none so we've we've had some hard forks and some network but it's total of maybe four or five hours for the past five years um and so that's that's a pretty good uptime measurement uh so in terms of decentralization you start to eliminate

failures uh in the system then you get into portions again it's it's aspects like privacy since there's no Central server there's no Central thing to essentially hack or expose or or or get into so you could have a relay node in that gets destroyed or or whatnot doesn't matter because you can't read any of the intermediary information so let's say a minor goes down or it it gets broken into it has no effect on the Bitcoin Network same thing for the storage Network particularly node gets shut down or hacked or falls off some server wreck has no effect on the network because

it's just routing that information through is providing uh an additional portion to the network but you you really have to destroy large amounts of the network to have really any effect um so let's kind of take this what you've been talking about and go a bit into the the architecture of storage so as as far as I understand right on the files essentially get cut into pieces and then stored by a whole large number of uh nodes in the network and and then there's the redundancy aspect is that correct correct so let's kind of Step through the lifetime of a file on this

network so you have let's say cat. JPEG and you want to upload it to the storage Network you want to store this awesome cat picture that you took so you take this file it would go into the client software sitting on your computer it would encrypt that file with keys that only you control it it would split that file into multiple pieces using eraser encoding and then it would distribute those broken up encrypted pieces to multiple people on the network so the idea is that you have um let's say for example three people who are hosting the Redundant chunks of these files and so

if one goes down no big deal the Network's going to check that and say okay that person who was supposed to be host that chunk is not there anymore so we can recover that from the existing chunks and so from that portion we have all these files or bits of chunks flating around the network it's encrypted on your computer so doesn't matter who's listening on the data connection or who has a checkin that file it's encrypted they have no idea how the pieces go together on the other side of that you want to retrieve that cat picture and essentially uh maybe share it with with someone else so you take the hash of the file so this is the identifier for the

file so it's just broken up in bits and pieces spread across the network so we have these identifiers for the file so we can find these pieces and then we have the keys so we can uh decrypt them and put them back together and so I have to keep these myself or if I want to share with a friend I share him the identifiers and the decryption keys and then either of us go to the network retrieve these files and download and decrypt them and so there's no kind of problems in terms of middlemen or people stealing or hacking the files because again they don't have access to the decryption case for the file unless you share it with them and they don't necessarily know how these pieces fit

together so that's kind of a general overview of the lifetime of file as it goes to this network now one of the cool portions of this it's a peer-to-peer Network so one thing people kind of question about is speed so essentially it's the the speed of a peer-to-peer network if you've ever use the Torrance or bit torrent you know that this is quite fast so you have a file that you distri it out and you have it spread around all these people well you can download all those chunks back simultaneously so under scale essentially you can retrieve that file back um the the the bottleneck is literally your connection the network is going to expand scale to what about the

connection speed of the people hosting your file you'll depend on those as well no well no it'll it'll add up like a tour Network so essentially I can be downloading this piece from this guy and this piece from this guy and this piece from this guy all simultaneously uh so you kind of add those connection speeds out so I had a question about that this is something that I thought about a lot because typically when you because you're downloading from so many different parts at once right so is this is this sort of speed expected on storage so there's two things that are rewarded in storage one is actually physically storing the files and you're

cryptographically proving to the other person or to the network that you're storing those files and you get paid for that two is the bandwidth portion so you're essentially getting paid for transferring that file to someone else so in terms of that there's this competition to say hey I want this file uh these guys are storing it these guys are W to get that file to me as fast as possible because those are the ones that are going to get the payment those are the ones that are going to get the reward uh so it's up to for the people who are we call Farmers on the network who are providing this resource uh to essentially compete and get that file to as fast as possible okay so there's there's in fact some

sort of a competition going on between different Farmers or I guess storage providers another way to call them to provide you those files as fast as possible and and those who can provide them first get get paid correct okay U is there a blockchain somewhere in there yes yes uh so we make heavy use of the Bitcoin blockchain and we're also uh experimenting with some other blockchains so essentially what we're using now uh in terms of the Bitcoin blockchain is we have storage coin which is a counterparty asset and of course counterparty is running on the Bitcoin block uh so that is the cryptocurrency that we use for buying and selling space

inside the storage Network and then we have other use cases uh in terms of using the blockchain to keep track of files where files are uh to transfer encryption keys and various different method methology that we use the blockchain okay so you use the blockchain uh for for different aspects such as uh sending money to pay for um the service provided but also to send information or to store the information the themselves are not the fs themselves are not storing on the Block yeah I know but the location or correct correct so we use the blockchain as a mediation method and

also know where the files are what's the state of them in the network um but we we don't just use the Bitcoin blockchain we're exploring other blockchains as well uh that we can use because we can use multiple blockchains as once so for for that those other things such as like uh you know the mediation message or like Communications between uh different nodes um I presume you are you also using counterparty for that or is it it's own SE separ blockchain um can you go maybe a little bit more into that sure sure so there's U many many different types and

many different applications many different use cases um so essentially we can use the Bitcoin blockchain as that you know cryptocurrency method and use that uh other platforms to essentially keep back of the files uh so essentially there the way we're building out storage is kind of one step at a time and so we're looking at some of the existing technology that we have out there in terms of building out mediation methods and whatnot and so we can have oral curs or whatnot enforce those mechanisms and those work to an degree but we're looking also looking to some future

platforms that are being developed like ather uh and whatnot uh to build up contracts to essentially make the data Network smarter uh to be able to have not only essentially service level agreements so you say I'm going to have this file and I'm going to provide uh this level of of of uptime for this particular file and this speed and so you do that um but you might need uh someone watching the network or some kind of Oracle to to enforce that but then we can start making that easier and start using things like ethereum and some of these other smart contract uh platforms to make them more enforceable uh so it can

work on every level but essentially there's some portions that we can use some of these future platforms to make it easier for us and essentially add to the feature set and add to the cool stuff we can do so it really depends on a particular use case if you give me a specific one I can dive more into it we just leave it at the kind of the general stage so sebastia you said you tried it out today yeah actually well I mean I just sent a file to to Sean actually before we started this so um yeah so we have two applications file quite simply just by drag and dropping it on on the on the web interface for for the beta of metad

disc correct so we have two applications that we're working on metadesk which is kind of your dragon drop ver web version of Dropbox and then drive share which allows users to sell their hard drive space the network uh so metad disk has kind of been floating right there uh in a kind of Alpha Beta stage and we're uh continuing to work very hard on dry chair and getting that integrated in so uh we we have some stuff floating around that people can play with now this this versional metad that's online right now is that something that people can use uh today I mean can we can we communicate this URL or not yeah yeah so uh the URL for metodist is node one. metad this.org uh I wouldn't recommend it for storing

all your super important files on there uh it's it's a very very rough development beta that we're constantly playing around with so of course you can use it if you want to share uh share a file with your friend or whatnot pictures don't look at us if if it gets deleted through some kind of development update or bug or what try it out just don't rely on it I want to kind of go into these apps so essentially this metad disk app is going to be the first uh real uh version of your decentral life Dropbox platform it it's it's it's very nice I mean it's it's a web version uh so you can essentially drop a file in there and then you've got the link and you can

copy that link to somebody else um how how do you see things evolving do you see because I mean that's not really how people use dropbox today people use Dropbox in Google Drive as a syncing service for them to kind of back up their files uh on on the cloud and and have sort of the the same file structure that they would have on your hard drive uh is this something that you see um happening in the future with uh with storage yeah so essentially uh we built on an API and then we built that uh application on top of it so that's just kind of a sample application uh so we can drag and drop files and kind of use the network and get things started started but we really see other kind of applications in terms of decentralized

video decentralized audio decentralized images web services running on the storage platform and then people building out or us building out apps that more function like Dropbox uh that use the existing apis that we use to build that application but instead making a more syncing application that you're used to um so we're working on building some of those things out and we already have the the platform in the API to to do that we just need to sit down a little bit more and actually physically code uh that sing portion on top so even something like decentralized uh web hosting is that something that could be done yeah so that's actually one of our major pushes uh so in terms of that the

the thing that we're trying to focus on first uh is Media so images video audio uh so you can particularly have uh you can store your cont content on storage you can have the storage Network serve that content um and so we're also looking at ways to also embed web pages in there uh how do you think that's is that performance- wise uh how is that going to compare to web hosting Services people use today whether it's like you know running um their own server or do something like so we see it uh best using our current methods and apis as almost a CDN or a

Content distribution network uh so you can essentially run just the static pages and database stuff off your own uh web host website server uh be it a small or one or whatnot and then we take care of like all the backend assets that take up a majority of the processing power and space and and whatnot so in terms of that we really see it it's starting to replace some of the content Services because of the feature sets it it involves so let's say YouTube for example um there's inherent takeown notices and what not you'll you'll

upload a particular video and some copyright institution whether or not that's a valid taked down or not uh they'll remove it so you have censorship within YouTube and a lot of people don't like that um so so uh we build out and we have demos of this on our on our website if you look at our form we we did the little app contest and people built these apps out so you can have a decentralized video player that's running on your website that doesn't go to YouTube but goes to the storage Network so that particular file that's uploaded can never be taken down or destroyed or whatnot the other portion is uh the fact that it's running on a peer-to-peer network uh so that file can be distributed to a server

or caching server that's geographically close to the users and we can distribute all uh all over the place and this kind of Auto scales and all balances itself uh so you can start getting really good performance out of just average users that really don't care about the privacy or centralization or Central aspect of it they're just like okay my download is is going a little bit faster uh because that person who's serving it is down the street um rather than in some data center a long ways away so we see both application developers kind of using it for their platforms uh initially for the content distribution and then starting

to get into actually serving full web pages and and full content through the network uh so's a lot ofes different types of Industries right I mean you could you could disrupt uh YouTube you can disrupt Spotify you can disrupt the whole CDN industry essentially you know right right um so you have to sort thinking of of of storage not as a singular application not just a decentralized Dropbox um but a platform that allows things like that to be built I definitely seen it as more as just of a decentralized Dropbox but um how do you how do you foresee that this will happen I me how how do you

plan on enabling people to develop these apps on top of your platform I think that's that's a core component of of being able to develop this is providing that platform for people to come on easily learn the API and develop apps on top of that it do do you think some sort of like an app store or something where people develop apps on top of storage how do you what do you see there sure sure so essentially that's what we're building out through metais so metad disc is kind of our full node full access the network application and coase so one of the things that I saw with Bitcoin is that it was very hard to get into development and very hard to get it

running and sinking and all this kind of stuff so when I was starting to design storage I said hey instead of having this be some specialized client let's build it in app into an application that can run on the web and so any old programmer that has at least some suance of an idea how to work an API can connect to any one of these nodes or run it himself and start to develop applications for it uh so we don't particularly see an app store uh for this but we particularly see people essentially taking the storage software and wh labeling it so they'll take the storage software as a backend to store

all their data for a game or some kind of application and then they'll essentially have a product built on top of that so we don't necessarily care about sticking the storage on just that they're using it as a back end they're using the network okay and there's a question actually in the chat room uh somebody was asking if you could build a relational database like a mySQL database on on top of storage so that's kind of like on our wish list um there's uh essentially what happens is with current blockchain technology it it's very hard to do that in a scalable manner so I can have some content like a picture or a video on there and I can

insert that and can get that around the network um that's that's a more immutable source of data that's a static source of data once you start getting into relational databases you essentially have to make things highly mutable and highly scalable and make them very fast you don't want to make a database query and then it takes like five minutes to execute um so in terms of that there's other blockchain te technologies that we're looking at and we're working with I think my tables on this and some other people to kind of figure out this concept of how we can take this blockchain technology and make it fast and make uh be able to have rappers and apis to be able to make these database systems that are

decentralized have no Central points of failure um have no Central company and run off of something like a blockchain but the the technical port pors of how we do that specifically are still kind of being thought uh thought of still kind of being worked on um the current blockchain technology is not quite there to get a very fast and very scalable database um so if if other people will kind of white label um storage to run their own applications on that does that mean they will use the same the same blockchain the same currency

for example correct correct okay so I I guess in that sense it it is uh is sort of like you saying what you mentioned before that essentially storage provides an API and then people write their applications on that that may have whatever kinds of looks on the front end uh but on the back end it's is one network of peers I guess in a little bit uh like counterparty Builds on top of Bitcoin but it's the same notes the same mining right and and that introduces some cool features so you can have someone who makes uh pinkbox decom and someone makes redbox.com and essentially

someone can store files on pinkbox uh which is this completely other application and then retrieve it on Red Box oh that's really it it it add some cool interoperability between the applications because they share the same underlying data platform that is cool that's something you can never do with something like uh Dropbox and Google Drive you can't store a file on Dropbox and then go ahead and retrieve it on Google Drive oh that is brilliant so if you you'd be like using Dropbox you say like a I'm tired I want to switch to Google Drive and but all your files are already there right you just um so then we start to getting the cool Market aspects and competition where people are using same underlying network but now

they have to compete for features and all this stuff adding on top of it yeah um and you know if they don't keep the users happy they don't keep those features sets up it's EAS second later I'm just going to go to the next website and all my files are going to be there so it really encourages people to build out cool applications uh to to grab the storage users base attention what what else do you think will happen because of that interoperability that perhaps today we can't even like really seems unexpected or something that wouldn't be possible today I don't know it it's it's kind of all up for grabs we're just kind of building out you know this tool set we're building the hammer and and

giving you some nails and saying good luck figure it out build some cool stuff and uh you know there's there's I'm pretty sure a couple of years ago we we couldn't even thought I just look at look at Bitcoin in 2009 could we have even predicted all the cool applications and use cases that that uh we built so far and are trying to build uh when when Bitcoin just came out so I think it's the same way with storage we can't really speculate on all the cool stuff that we could build um but we definitely know there's some some cool ideas out there so these are sort of the user facing apps right I'd like to come back to drive share and this position of being able to sell your your

hard drive space essentially on uh on the storage Network um this opens up I guess even some new business models uh because now as as just as a guy who's got a computer and some storage laying around I can sell my storage online but I can also as you've talked about in in some of your blog posts uh get a VPS um and a virtual prate server and rent out some space on there so can you elaborate on that sure sure sure so there's like really two people were trying to sell this on at least initially so a the people who already do M right they understand this uh coal cryptocurrency mumbo jumbo stuff and

they know how to run the applications and make it work uh so in terms of that we kind of want those people to start running this kind of Drive share software which is is really cool value proposition you say instead of doing all this hard computational work and just crunching hashes let's take this resource that we have and let's sell it to somebody else on the other side of the network and earn coins that way um the other portion is you know the average user who's going to like oh I can earn money selling more hard drive space downloads an applications hits go and he's he's earning cryptocurrency so the cool thing is it it adds the it look lowers the barrier to entry entry to the

cryptocurrency market so for Bitcoin you know you're not going to earn about a penny trying to mine on a a regular computer nowadays but for an average user they could add earn a couple of bucks of cryptocurrency and kind of get their feet wet in terms of storage and farming so yeah so there's kind of two aspects two user groups that we're trying to initially appeal can you talk a bit more about the profitability do you think it will actually be do you have any ideas so let's say I have 50 gigabytes on my hard disk I say like I make that available um what kind of what would I expect like

that be a few dollars a month or more than that sure so if you look on our our website drives share.org uh that's drives share.org we have a calculator here that you can put in a number of gigabytes and select uh a rate or a cloud provider equivalent and hit go and it'll give you like the the the estimated uh cost per month or the estimated earnings per month uh when you start to doing research into cloud storage you you start to find how much these guys overcharge for their services it's actually anywhere from 10 into 100x so if you look at a provider like em EMC

they charge last time I looked about $3,000 for a terabyte so you can go to Best Buy and grab a two terabyte drive for 60 box so when you start to actually crunch these numbers there's there's these huge margins uh that these guys are are are operating yet and one it's for profit motive and and two they have a lot of cost associated with it right they have servers they have employees they have maintenance they have heating they have cooling you have the electricity the insurance investor profits building space all these things factor into those costs for the storage Network we eliminate all those you just download an

application hit go and that's it so we've eliminated all these these costs and these profit motives that you know these large corporations charge because they they theyve really cornered Market um so at least the for the people that participate initially I think they'll they'll be quite happy uh with the amount they earn so um it's everything's based on a market in our ecosystem so you have you're renting out your hard drive space you're setting a price that you'll set that hard drive space for and someone on the other side of that Wills uh set the price that they want to buy storage space for and so you meet on a market uh so we want to make it less of a singular application or

singular use case it's a market uh for data so those tug back and forth to to get good price Discovery and uh and and good pricing based on demand so you think it would mostly be people seeing an opportunity there and then renting space on for example Amazon or other cloud storage providers and and then making that available uh it be people having space on their own computers at home I think it'll be it'll be both um so it all depends on kind of the demand of the network and the need to network for data um so in terms of that the man for data might

outpace uh the amount that people can share on their hard drives or physically plug in so then you'll look to external services to kind of augment that as that that begins to grow so it it'll be a mixture of things all trying to cater to this market demand of people who want storage and or buying it from the network now you make some some projections as to the types of profits that you could earn If You by selling VPS uh storage so essentially you have a cost of about $635 per month you could make a gross profit of $88,000 per month am I reading this right uh so if you look look at so it's again it's decided on the market

prices it's decided on the demand uh we have like I said a calculator on there that what we do is just compare it against different cloud storage providers so we say this the amount of gigabytes you have this is the rate of Dropbox or Google drive or all these other services so you can kind of estimate okay how much would they earn how much would I earn how much would I price it on this Market uh so I I can't predict a market if I could predict a market you know I'd be buying and selling Bitcoins making you know millions of dollars and I'd be off on my guy so we're just providing a flexible platform um and the market will decide what the market decides of course if if it's true right sebastia like the

numbers you were reading out then what we'd expect is that lots of people come in start offering uh storage space and the the price would be H driven down to I guess the marginal cost of people uh you know providing that and yeah so so that's essentially what we would hope uh but the the thing is we have to think of is the cloud storage and Computing industry is $ 150 billion doll industry so essentially we have to saturate that 150 a year uh dollar industry before we start driving down the cough and so at that point it's a lot bigger than Bitcoin and a lot of other portions in this cryptocurrency space so

the cool thing is unlike my saying uh for farming there's existing demand there's who doesn't use dropbox or Google Drives or any of these cloud storage companies this sort their data and even large corporations are using massive uh portions of data so there's huge billions and billions of dollars of demand that we have to cater to first before we'll even start to drive down the prices so but we can still make those nice 10x 100x margins that all these other Cloud providers uh make in the early stages what would be interesting would be much like a lot of the financial industri starting to now wake up to bitcoin uh and perhaps even

taking advantage of some of those Technologies themselves would be for large Cloud uh storage and uh providers like Dropbox and Google and Amazon to also start doing this kind of thing and also oper start operating storage nodes yeah I I agree uh it would be a nice welcome change for them to start to pay attention to privacy and encryption and all these other portions that we bring along with it seem very likely to happen huh yeah but it's it's very unlikely that a several billion dollar company is going to completely change their business model um but hey they might um and I think it would be great for all of

us now let's get into the the crowd sale so there was a crowd sale that started I guess a few a few weeks ago it's now ended yeah yeah so we had a crowd sale around augusti and that now we raised 950 Bitcoins uh as a portion of that uh so nice decent chunk of change uh so essentially the value proposition from from that is that uh you participate in the crowd sale and you from that you get early access to metais drive share and then you you get uh some storage coins so when the network starts up you can buy and sell some space in the network

uh so those were kind of the three value propositions of the crowd sale and so that's yeah go ahead um so people that way bought some storage coin uh can you tell us a bit about you know how many uh storage coins were were given to people that way how many exist uh overall right now and and how is that going to develop in the future sure sure sure so in that portion um a lot of people are signed up uh based on their contributions for Early Access and then the other portion is we have about 41 million uh tokens that were bought uh or

yeah purchased via the crowd sale and that is uh it's worth noting that that is our first crowd sale so I think we're one of the the only people who are intending to essentially do a multi- round crowd sale so we kind of want people to see and actually play with and actually use the software uh before they really start saying hey this is you know something that I actually want to purchase tokens in or early access to um so we don't want to get into the whole butterfly Labs two weeks never deliver mount g kind of kind of thing so we kind of start out slow people can see our

progress people can see things coming out and so we can give them uh another portion to be able to participate in the crowd sale once they say okay this is viable this is not just some crazy far-fetched kind of thing um so that's why we're kind of doing a multi round process and that allows us to kind of mix rewards uh based on what we're working on yeah I'm just curious cuz right in a sense it's like you can think of storj as a startup right I mean it's not too different although in some ways it is very different right because it's a decentralized thing um and and it's interesting just see how these Economics work and and you know I think ethereum is one where like a lot of people looked into it a lot of people you know it was

because it's so well publicized such a a big project so I'm I'm curious to sort of understand here as well so let me um let's go into that slightly more detail you mentioned that for 1 million tokens were sold in that that first round um is does that uh correspond to let's say 10% of all the stor sh coin or or storage coin um right so there's going to be essentially is there some valuation uh you can attach to that sure so essentially we've hard capped uh the number of storage coin that there's ever going to be at 500 million storage coin

so you can do the percentage calcul on on the percentage of tokens uh 15% of those tokens uh go to the developers to spend on apps and development and documentation and the other portion to that that no one's done is uh essentially 15% of that also goes to the community uh so those funds are controlled by community members that were voted in uh to essentially spend those funds for marketing or promotion or bilding apps um so I I always thought it important that the uh the the people in the community we the developers communities have some kind of uh token or usage to be able to promote adoption

promote development via bounties and all those kind of portions but the the problem is uh that I saw working on the projects is that only the developers would have the tokens right only the developers would have uh some X percentage or or whatnot and so the community leaders or the people in the community would have all these cool ideas on stuff they wanted to do but they would have to ask the developers permission to be able to do that and so I said like no no no no no let's let's give the the developers some resources but but balance that by the exact same percentage for the community to have the exact same amount of

resources the community has the exact same amount of financial power so you don't sense ize all the tokens that you use for these projects in one group no you have two groups with equal Financial power in the storage ecos system and that's worked out very well for us so so you would be um you know part of the developers right then the 15% community and then I guess about 10% of the total went to the the people um who invested in the crowd sale so how does that work with the other 60% are those sort of held in reserve for future crowd sales as you mentioned so I wouldn't say invested

people bought Early Access to software in the crowd sale um so we're not getting in terms you know we're not issuing unlicensed security and all these these guys I I actually did want to ask about that I have asked a whole bunch of people all doing s of similar things like always like H how do you do that what's the legal side right right so we really don't want to get into that aspect of this being blatantly issuing you know illegal Securities or whatnot we develop software and so crowd sale is you get early access to software so you can start Mining and and and use these cool applications that

have all these different features so that's what people are are purchasing and the tokens are kind of just the extra that's used as the fuel in the system to make it run um so you bought a car and we gave you some gas with it you have to go to the gas station and go buy more gas but you can load up on gas now if you would like um so essentially that's that's kind of the the portion to it uh so the the other tokens are just kind of held in reserve to be used for two main portions one is uh future crop sales uh that we hold and the other for so that's can be for the metad Des and drive share applications or other applications that we want resources for

for other developers outside of us or inside of us to work on uh the other portion is essentially early uh farming uh so the people participating in the crowd sale we have this schol of funds that we can say okay here here's the resources that we want to post on the network we want to let's say for example download all of YouTube and store it on the storage Network so we have some tokens to be able to kind of Kickstart that and get that working so so that also means that there's not going to be like a a mining and then a continual money increase because all the money that miners earn comes from people who who pay storage right it's sort of a closed Circle right so that's one of the

things I I highly disagree with in in terms of uh building out resource-based networks um you have other portions in projects that essentially they have mining in they're just devaluing the entire network uh so we we don't want to do that at all we don't want to devalue the Token using the network by this uh this generation when we can use other methods to secure the blockchain and whatnot so uh I'm a pretty strong proponent of not using mining when you don't really need it and for proof of resource actually uh when you start adding in mining portions it it it it it starts some really bad behaviors in

terms of thech that you really don't want in your network and it it adds more problems than it solves uh so we we thought of some some really the alternate distribution methods and then we used of course the Bitcoin blockchain via counterparty to actually secure the stuff uh so but we don't have to worry about this generation of tokens that's just devaluing everyone so we've got a couple more things we want to talk about but before we do that uh we'd like to talk about our SP fairlay fairlay is a Bitcoin prediction Market where you can place predictions on the likelihood of sporting events the Bitcoin price and current affairs among other things and if you bet correctly

you earn money so Brian can you tell us what's the prediction Market yeah absolutely so a prediction Market is is a a site or is a market where basically parties are matched up and they can make predictions about things so we actually have have a prediction today that's is super um relevant um to the topic we're talking about and let me just pull that up so the prediction is whether in April 2015 the market cap of uh store store storage uh coin X or what exactly is the

name yep storage coin X that's correct storage coin X or mat saave coin is going to be bigger now I'm actually going to ask you about mve afterwards because I'm curious how those uh projects compare essentially that gives you sort of an opportunity if you believe more in one projects or any other project to you know take a position on that and you know see how it goes of course it would also be for you Sean perhaps if you want to hatch your risk perhaps it could be something to bet on M I don't know to what extent those are competing but in in the end they do both provide some kind of a a cloud a storage solution um so if you want to check that out you know you you can um take a position there and and see how things work out and perhaps it also

makes it a bit more exciting to watch how this space develops um what's your prediction there Sean at at the moment I know uh M safe is a much uh a much bigger platform well at least the the market cap is much higher but sure sure um so in terms of that I don't know uh there's I'm obviously I'm I'm kind of biased so so I'd probably have to say storage coin uh but uh in terms of that uh a market cap is is probably not the best representation um actually our our total amount of coins

is Mis misrepresented uh on coin market cap so as we kind of build out those will probably be fixed so our uh I'll actually do see if I can do the calculations here but if you actually add the total amount of coins that that we're actually going to have and actually be created I think people are going to be like wait a minute why did they jump up you know 100x or a THX farming all those coins and so they've entered the market and so we have a a kind of jump in market cap so those numbers aren't completely accurate that that are on market cap right now so anyways if you want to take a

position on that you can do so at Fair lay.com epicenter uh and you'll find that prediction in the in the Bitcoin section and so want to thank.com for the support of epicenter Bitcoin absolutely so let's actually use that as a great segue into something we just touched on now can you talk a little bit about how uh storage compares to uh made safe and and also there's another project called bitcloud that sounds really similar to me um I'm not an expert in in these these three projects but can you run us through what the differences are also so of course people who want to take a

position have some more insight knowledge sure sure so uh you in terms of decentralized cloud storage platforms uh you should be looking at storage made safe scoc coin permac coin and filecoin uh so those are the five uh main portions that kind of look pretty promising in the space um so I guess that your first question was in terms of maid safe so we actually have a a pretty good relationship with uh just about all these projects including maid saafe um actually we've been talking to them from the very beginning of their kind of for rigns at the crypto space uh so earlier

in the year when we're kind of doing our due diligence on storage with the bid Angels is when uh they kind of stumbled upon maid safe and kind of doing something similar uh so out of that discussion uh they kind of sold that you know crypto would be a a good solution for them and so they jumped in the Bitcoin space and and had a very successful crowd sale um and here we are so we've been talking to them from the very beginning so so love what they're doing and uh what they're building so the difference between main safe and storage is essentially they're working on the decentralized internet and we're more focused in terms of building out

just decentralized storage so they're both a little bit more broad they have a lot more stuff that they have to cat up ours is just getting into the storage uh ecosystem and area but really um we're looking at all these platforms including scoin and permac Coin and filecoin and M been saying at the end of the day we mainly develop applications here at storage or at least sample applications that can be expanded so if any of these particular platforms take off and is actually viable uh we'd be happy to implement it in our applications um there's you know we can build out apis how would you do that uh so that depends on the technical implicate implementation of each one but

the idea is that these are decentralized open source file storage networks so we can build apis to make them interoperable so we can have our metais app and you store a file on this metad disk app and essentially can plug into the storage and the main safe Network so you can take your file and you can store it on the storage Network the made safe Network you can split in half and do both um so you can simply just increase the the the the the choices that the user has um and again it's it's all open source it's all distributed it's all decentralized so I don't see any kind of reason why these platforms can't work

together um and we said publicly that we're we're going to take a non uh competitive approach with all these other platforms because it's way better to just work together and build some really cool apps that mesch the platforms and really cool features that just mesch the platforms than trying to you know fight or compete or or or the like because we're just going to ing out and we have $150 billion doar to saturate so there's lots of stuff to do and there's Yachts enough for everybody now before we wrap up I wanted to ask you I guess maybe a question that's in a lot of people's minds is how do you make money with this like how how do you pay yourself uh by developing stor J and moving forward how would your

company make money sure sure so we kind of have two portions to this a one's the open- source Community side and that's funded by by crowd sales and built up by the users and developers and volunteers and whatnot the other side that we have to that is storage Labs which is essentially a corporate entity that's uh going to be entering Venture funding uh pretty soon and so essentially that's taking the storage protocols and tool sets and wrapping up in a nice pretty bow and pushing it into uh Enterprise customers and whatnot so think of it almost like starting bitpay or coinbase

in 2009 at the exact same time that you you launch and your you building Bitcoin and so you have immediate use cases into Enterprise and things that you can start thinking about from the very beginning and so you'll have a company that wants to use all the feature sets of storage in terms of privacy security cost savings and but they don't understand or want to deal with all this Bitcoin blockchain crypto MBO jumbo so as storage Labs as as an entity can provide nice tool sets and Abstract all that stuff out for them and so they can use it just like they've been using Amazon S3 or all these other services so just make it easy for them to to use as a

tool and they don't have to carry about the the technical back end at all so that's a bit of the sort of Red Hat Linux uh type relationship that uh people often mention as a as a as a business model in in an open source space right right so so it essentially is on the lines of that model OKAY interesting well um thanks so much is there something else you want to talk about I guess if people want to learn more about the storage they can um where can they reach you or get involved in the project um the the primary website that you want to go to is storage.com .io

sj. sj. and so that's where you can s up for mailing list to kind of get the status on the project when things are going to be released um and and kind of what we're doing in the space and then you can look from there in terms of the applications that we're building and the demos that we have out um so that's a great place to get information uh if You' like to get involved we're we're looking for more developers to you know build applications on top of storage that do cool things and play with our existing apis so you can get in contact with us at hello at storage sj. if you want to get involved that way

and we have also a form and some other mediums to get in contact with us in the community uh towards probably the end of this year beginning of next year we'll probably do another crowd sale so again the main value proposition of the crowd sale is Early Access uh to the software for storage so we'll be pushing out very very early versions of Drive share and metad this fairly soon but again only the people who participate in the crowd sale will get access to that uh so we'll open up that opportunity again once we get feedback from our uh initial participant just very briefly if you participate in the crowd sale law you

also obtain uh you know storage coin right which then exactly exactly you you could potentially although I guess you're not intended to since it's not Securities offering but you could use that to speculate on on the you know the future and the success of the platform correct right so I mean we're we're more using the cryptocurrency uh for buying and selling space in the network and using it for Early Access necessary point but it's a cryptocurrency people are going to do what they're going to do with it so we have I

bought Market will some people do it yeah if some people do it don't blame it on Sean don't blame it on me I I didn't I didn't do it I was developing a software you know so okay excellent well thanks so much for coming on I think it was was super interesting to go into that and uh just see the sort of really the first time we had a decentralized application on uh and not just talked about it sort of as a theoretical thing and as a we work on that broad area but something really specific and and I'm actually um really excited I think

sound I got to say to me this is probably one of the most exciting are of of development in in crypto and decentralized apps because it seems so obvious right uh also it's something that everybody uses I mean to me it's it's what I'm most most looking forward to in terms of what what I could actually use uh crypto far I agree it's it's just we have this tool set we have this problem they fit together quite well um and like you said it's just kind of the obvious N Stuff I think the the next uh uh I guess sector that needs to be that needs to be

uh disrupted like like you're doing would be access to Wi-Fi yeah so meshnet is next yeah so we have to F uh solve decentralized cloud storage maybe decentralized compute but uh that mhet is kind of that next third step so when you're you're starting the the mesh net. it's probably already taken so but we'll see where that goes there's plenty of exciting things in the space so always always good stuff to look out for yeah well thanks so much for coming on again uh thanks for you know letting

us uh talk about this topic and I think seasa will be excited to try it out I'm going to be excited to try it out and I'm sure of our listeners are going to be excited to try that yeah maybe we can do another talk once we get a little further and start pushing some things absolutely some point down the line um yeah and thanks so much for listeners for listening we've had like 13 viewers on here the whole time which is pretty cool because we've just started doing Hangouts I think most people are like almost everyone still used you know they listen to it as an audio podcast uh but it's great to have actually some people uh kind of live in it's exciting we had questions too you had a question that's

that's super exciting so hopefully we see more of that in the future also for those who are just listening on audio uh we are doing live Hangouts now so you can sort of watch it live also ask questions interact um you can of course also follow us on Twitter at epicenter BTC will also let you know when the Hangouts are happening uh so you'll know about that and you can of course support us with your tips uh which we do appreciate at eper bitcoin.com tips you can also subscribe to Weekly Newsletter at eper bitcoin.com newsletter and leave us an iTunes review we would love that and you can let us know how we're doing what we can do better so um and what we're doing well

of course don't forget that so uh thanks so much and we look forward to being back next week all right awesome thanks for having me