The Real-World Challenges of Blockchain Projects
In this episode of Blockchain Beyond Hype, we interview Lee Willson, the Co-founder of Blockchain Zoo, and the Founding Supernode of World Blockchain Foundation. We discussed topics such as the real-world challenges blockchain projects are facing, chain commerce, how to evaluate a blockchain project, and more.
How to determine if you need a blockchain project, and if so, what kind?
We develop applications. We need to know our priorities, which are the ones we should do first. OK. Some are a must, some are good to have or nice to have. So I think we should concentrate on those things which we need blockchain more urgently. One is the financial usage of blockchain, but that part is heavily regulated. So we need to talk about other parts. How that could revolutionize the industry because, you know, when people go on e-gaming and play games, you don’t have a border there. OK. When you play games online, you do not actually care who the other party is or where they are. OK, and is there any time zone, right. And when you play games, you play games. That is something that is very good to be blockchainized in a way, and of course, we also talked about chain commerce. Right, because now, when we talk about e-commerce, it requires a platform that needs to be based locally in a country and in a certain market, and because it’s very tightly controlled by the flow of money or payments.
So the only way now is to use credit cards. But we know that credit cards have a very high cost of payment and the clearance is slow, but you know, that’s the way it is. But if we do chain commerce, then that will really really facilitate the decentralization of platforms like Alibaba, TaoBao, and Amazon. So these also are the areas. And another area to blockchainize is, I think most importantly, information, and information is transmitted through the Internet. And when we see the Internet, we are talking about TCP/IP protocol. But when we talk about real free information that it might need a different type of Internet, that is not TCP/IP.
Why should the chain commerce get blockchainized?
In the internet era, we talk about platforms, right? I mean, platforms are like the toll. If you go on a highway, you have a toll to pay, right? So the platforms are like tolls, where buyers and sellers meet. Where passengers and drivers meet and where holidaymakers and homeowners meet, you know what I mean, right? They have to go through this platform, and for every transaction, this platform would take a part of the profits. That is why they became the giants in the world now. Just like, you know, Amazon, Alibaba, Uber, and Airbnb, because, you know, everybody needs to go through them and through the transactions. They just take a big part of the transaction, and they become the richest in the world, but this only benefits a few people. The board of directors and the shareholders of the company. Can you imagine if all of these are being blockchainized, meaning to say that this platform doesn’t belong to one company, but belongs to all the people who participate in the economy? Meaning to say, can you imagine this? If business transaction by a seller or a driver and a passenger, for every transaction that is a part of money, in terms of tokens, to be used for this locked in the smart contracts, and upon the execution of the transaction, this part of the money, which originally is supposed to go to the shareholders, to the company, it goes to the contributors to the economy. So can you imagine those who maintain the nodes would get a part of the payment? Those who bring in more communities and customers to the market will get rewards, and best of all, even as a shopper, as a consumer, you are being rewarded because you contributed to the economy. So, that would be a totally new way of economy. So when people are talking about sharing economy, actually they’re not talking about the real sharing economy. Only chain commerce is the real sharing economy because to share the economy, everybody needs to share the wealth.
How to start a blockchain project?
To start the blockchain project, I think one needs to think, or if one really has a very clear mind of a solution to an existing problem, I think that’s the key—the most important thing. But I do understand that nowadays we come across people who want to start a blockchain project for the sake of starting a blockchain project or wanting to make some money out of it to create tokens, so that they can do fundraising and eventually, hopefully, that, you know, they can come up with a project. So I think that is the greatest blind spot by most of the startups now.
How to build a successful team for a blockchain project?
First of all, you need to have someone who is in that industry, because as I said earlier, to start the blockchain project, you have to identify the problem. You also have to identify the solution to the problem. So you have got to be an industry professional to be able to do that, is the first thing and the second thing, you need to have the technical experts to really deliver the project, to carry out what you have wanted to do because it’s not enough, I mean, it’s like building castles in the air. You know, I can’t talk about the details of the castles, the color of the window, the door and how would it be like but if I don’t have anyone really to build it, to deliver, then, you know, it is very hard, and this is one of the hardest parts because blockchain technology is still very new. OK. And being new, there are not many professionals who really know how to do it. So it’s more talk, paper talk than the real thing. This is one part. And the second part is for any blockchain to be successful, you need a marketing team who is able to build the communities. All of this needs a lot of money because to build communities you need to create awareness, and you can only create awareness by participating in activities, seminars, events, maybe advertise on social media and nowadays, especially with thousands of blockchain projects going around to separate yourself from the others and trying to tell others that you are the real thing. It’s very hard because you know the market. It’s very difficult for them to tell the difference. To be very fair too, most of the market is not interested in the technology itself. They are only interested to know when the tokens are available, which exchanges will they be on, and what are other market-making strategies. So basically, they’re just interested in the money. So that is why you have this market of some people keep on producing these projects, producing the tokens. And you also have the other party who is willing to jump on the bandwagon and profit from it. So I know it’s not healthy, but it is the same thing, the same case for the Internet 20-25 years ago when there was the Internet boom.
How is this influencing the adoption of blockchain by businesses?
I think this is adversely influencing the businesses. Unless they are very forward-looking but still, which business dares to take the risk because you’re talking about shareholders benefits and stuff, so you know, the board of directors would dare not go to risk the company’s profits and face legal issues and things like that. So even when people talk about STOs, they’ve been talking about STOs for the past two years. But until today, has any company or any project successfully launched its STOs and become globally recognized and in circulation? So, it’s not that easy, and if you can’t even go for STO, which is the only representative of the shares and the stakeholding or security, what more about other things? The legal fraternity is trying very hard to catch up. But still, I think it would take some time before that happens, before blockchain and tokenization become really popular and acceptable by the general public.
What stage of the blockchain project has the most challenges?
Well, during different stages in the Blockchain era, there are different challenges. So, for example, the earlier ones would be technical. So it’s very hard to find technical people who are able to deliver the project as they mention in the white paper. That was in the earlier stage. But then in the later stage, the harder part becomes the funding because there are too many projects popping out almost every day, and there is not so much hot money in the market to pour in. All right. And even Bitcoin and Ethereum are still facing a hard time of stabilizing its value, its prices. So you can imagine that any new projects nowadays, I think the hardest part is to get funding from the right people because for a real blockchain project, especially a public one, to be proper, you need actual participation from a lot of people to be truly decentralized. But to do that, you need a very extensive reach of the market. You need to reach different people from different places, from different countries, different cultures. And to do that by itself requires a lot of capital and costs a lot of money. So you know that is why some projects, that I know, they actually just approach a few people who are able to fund them. But when you only have a few parties who are able to fund the project, it becomes rather centralized, which is not a representation of a proper blockchain project. So I think that is a very big challenge we are facing generally in the industry.
How can these challenges be overcome?
By extensive education, training by real blockchain professionals, and that is why companies like Blockchain Zoo are producing a lot of educational materials to the public. So I would advise those who are reading this to go to the Blockchain Zoo channel and watch a lot of these educational videos to learn about the technology and spread them widely. So because if we have more people well aware of the real technology, of the real spirit of the technology, then it would help the market identify the real projects and help those projects prosper.
So the first one is to identify the problem and have a real solution to that problem and do a proper white paper. Two, to assemble the team, especially the technical team that is able to deliver the project. Three, to create the community for the project. Four, to work out the funding of the project. Five, the implementation of the project.
How to evaluate a blockchain project?
To identify a good blockchain project, I think the first thing is to know who the founder is, because the founder himself needs to be fully committed to delivering the solution for the problems that he identified in the first place. The next thing is the team that he assembles, the people, the capabilities, and the commitment to the project. And three, the technical roadmap for the delivery of the project. Four, a fair distribution of the incentives to the teams, the communities, and for those who participate in the blockchain, preferably decentralized. Five, the delivery of the application itself.
How do you envision blockchain changing the world?
A lot of blockchain projects talk about changing the way people live, changing our lives, this I would have to disagree with because the best way to change is to not let the users feel the change. So it’s like if you can introduce a blockchain application without having to educate the users and make them use the application without realizing it’s blockchain, then you are successful. I think that the key to it.
How do you think the market for the blockchain-based solutions will evolve?
I think in the future that all the applications, whatever it is, we need to think of this because to educate the users of a new application, the cost is very high. Look at the cost to do that education is very, very high, and not many projects are able to sustain that period of education. So the best way is to think of a way to fit in-depth with the usage habits of the users and infiltrate into their lives without them realizing it.
Lee Willson, Co-founder and CTO of Blockchain Zoo, Founding Supernode of World Blockchain Foundation. Willson has been a well-known international business consultant across various industries since 1997. In 2004, he was invited to a direct dialogue with State Leaders by the Chinese State Council as a Special Representative for Overseas Chinese Young Entrepreneurs which was held at the Peoples’ Hall of Beijing, China. He is also a dynamic speaker, investor, traveler, philosopher, and writer all rolled into one. Willson is a highly recognized world figure in crypto assets and a prolific blockchain spokesperson, today popularly known as Blockchain Ambassador.