The Missing Piece: Peer to Peer Compute - TOKEN2049 Singapore 2022

thank you very much it's great to be here at token 2049 appreciate you guys coming um we're going to talk about compute uh which is the missing piece in a web 3 world and I think we've made the huge advancements across this web3 ecosystem but we're not there yet and this is what will take us there so what is fluence fluence is a peer-to-peer compute protocol and it enables this decentralized Computing which I'm going to talk about a little bit I helped found hedera hashgraph and I'm a co-founder of fluent slabs what is compute first of all and this is a little bit high level most of you may understand this but it's the processing that underlies all transactions that do not in all processing that's not on your phone or your desktop and that kind of is Central to any type of complex application so where is compute compute takes place in two places right now either the cloud or proprietary in-house servers and importantly the cloud is not a benign puffy white ethereal uh organism it is dark and it is um depicted here as a rain cloud and a storm cloud because it's dangerous and so don't buy the white puffy cloud logos that you see from some of the uh from some of the providers what's wrong with centralized compute well if it's hosted at particular companies it's clear there's censorship potential and we've seen that Facebook Twitter very easy for a centralized company to censor and if it's at a cloud the issue is dependency and a cloud is very easy to get an application spun up but once you're up it is not an easy place to leave they own your data you're subject to the services they offer and the pricing that they give and that's very hard to leave and that's why they're growing revenues at 40 to 50 percent a year the other problem with centralized compute is de-platforming and we think of deplatforming in two different ways first is what applications can do and applications like Twitter Facebook can just cut you off for no reason we see it happen regularly and that happens with a variety of opinions they don't like it also happens by the cloud can kill applications and we saw that happen and most um publicly with parlor and no one's life here I don't think was dramatically impacted by parlors de-platforming but it was a big wake-up call to people and companies on Amazon as the power they have for any violation of a 58-page term of service that keeps changing and keeps growing and why does this happen governments governments are behind de-platforming because as companies grow they have to interact with governments and governments have more and more influence but the other issue with centralized compute is that the systems are closed and that inhibits Innovation and you used to have Twitter and Facebook that had open apis and were easy to build on and in 2018 those apis were closed off and that prevented companies that sound somewhat trivial like Farmville or tweetbot are terrific but if you expand that out to the real to the world of applications when you inhibit Innovation you just you you don't even know what you're missing and it just prevents developers from experimenting and adding on top of it and keeps us in the world that we know today and we it's hard to imagine what else is possible we think web3 may solve that but if you get to web 3 you see the same problems and a lot of web 3 companies actually rely on the cloud right now infura a critical application relies on AWS that doesn't it's nice to have a decentralized front end but if your computation happens in the cloud you can be turned off again by a government directive by a term of service perceived or real violation and that is not a comfortable place to be you also have web 3 dapps that are not on the cloud but instead run their own servers that's centralized too they may have the best intentions but that is not secure that is not safe and that is most definitely not decentralized and by the way this isn't their fault it is just the fact there hasn't been an opportunity to um change and to have a decentralized compute back end so is this the internet we signed up for I don't think that's the case it was definitely not Tim berner's Lee's Vision but the internet rewards scale and every company that starts to grow it gets more Revenue as it gets more customers and you end up with oligopolies and even monopolies in different areas and these dominant companies just will have relationships with governments that's just how the world works for Better or For Worse you name an industry whether it's a Legacy Media companies whether it's the railroads all of them had very deep ties to existing government organizations and that leads to levels of control that vary and we're never in a more centralized place than we are now because of the architecture and the incentives and the economics of the web so how do we get here we start off with mainframes and desktops and then kicking and screaming people move to the cloud and to give a sense of this type of transition I was investing in data centers which was kind of the early description of the cloud back in 1998 all right do you realize how early that was AWS didn't start for years after that that was probably 10 to 20 years too early to be looking seriously at data centers we're now the next generation of that is peer-to-peer platforms the cloud is dominant 80 the the British regulator just announced that 81 of cloud revenues in the UK are Amazon Google and Microsoft and there is now a um an Anti-Trust um investigation about those Cloud companies that's how dominant they are but that took 25 30 years to get there this next world is the peer-to-peer World we're at the very beginning of it and what is peer-to-peer compute peer-to-peer compute is this compute but happening in a decentralized way without a centralized host interestingly you can run it on a cloud you can run it in a centralized company you can run it in a house but you're in an open platform people can switch and move their data around easily and seamlessly and all those entities do is provide the infrastructure and the open peer-to-peer compute is a protocol that'll uses that Hardware infrastructure and allows compute to happen and move easily there's two types of compute and everyone here is very comfortable and can knows blockchain compute that's smart contracts and smart contracts are peer-to-peer compute and they work but they're only sufficient for deterministic compute they're great and perfect for defy and that will work and continue to work um forever but their deterministic redundant constrained and expensive and slow general purpose compute is what 99 of the web runs on and that's what we need to move web 2 into web 3 and have proper decentralization that is what fluence is working on permissionless with universal runtime that's cheap and fast and infinitely scalable that's what we think that's what we have to get to because scaling blockchain compute to billions of transactions a second like the web is is not a realistic goal so why is this the future because peer-to-peer um is scalable secure and resilient it can scale faster and cheaper when you have a hardware marketplace around the world that can respond to price much faster than any centralized company so a global Marketplace for hardware for compute whether it's computer storage is infinitely scalable and can respond much faster than any centralized company also it's secure it's censorship resistant because there is no one host there is no one company that either hosts or provides that application and so there's no legal entity to compel no management to threaten no directors to influence and no shareholders to pressure so open peer-to-peer networks and Protocols are the only chance we have to resist the power of governments dominating and controlling kind of every aspect of the web which is the direction we're heading in it's also resilient peer-to-peer networks you don't have single points of failure and here we can see and have been well publicized you know Amazon outages you know Facebook WhatsApp outages we've all seen that and those I think we can chalk up to centralized systems and and user error and even software errors but what we haven't talked about are deliberate um web outages that we can see in Iran and we see many other places peer-to-peer systems are the way to create res systems resilient to both inadvertent outages but also deliberate attacks at infrastructure and so this is something also critical for um the um for the well-functioning kind of world that we want to live in and peer-to-peer compute platforms right now exist in payments right you're not seeing Bitcoin shut down in any of these countries and you're not seeing you know five ipfs or file coins shut down in these countries they work and that's terrific but we don't have compute and without compute you can't have that type of environment that works for um actual functioning complex applications and so look at the traction we have Traction in peer-to-peer payments with Bitcoin ethereum that's not going away and we have Traction in storage the storage is kind of the great story of peer-to-peer over the last several years especially with filecoin just hitting 200 petabytes of storage that's a huge amount of storage there is a long way to go but they are scaling and so that I think problem is well on its way to being solved but peer-to-peer compute in terms of smart contracts is Tiny and how tiny hard to gauge this Market it's a couple hundred million dollars maybe it's 300 maybe it's 500 UC estimates all over and it's going to grow quickly it's going to get to multi-billions but how let's compare that in scale Cloud revenues are 126 billion in one quarter all right on a year that's about 4 000 times more and Cloud encompasses content delivery services Encompass storages so it's not just compute so that's not a fair Apples to Apples comparison but it gives you orders of magnitude scale as to what we're talking about here and shows how tiny smart contracts are in comparison to what we need to do in order to get um really functioning systems going and why is that it's because it's hard and why is it hard you need to be decentralized verifiable and scalable and so without blockchain that um that that verifiability is a challenge and so fluence is using a combination of web of trust Quorum and ZK proofs to achieve that security and when you have that which is the verifiability and then you do that you're not constrained by the blockchain limitations and the competition isn't blockchain the competition is AWS and the other Cloud providers and when you get to that world which is where where fluence is where what do you get what do you enable well no closed ecosystems you can have open applications that are easily composable and shareable and that is um lead to terrific Innovation because it's a creativity accelerant you can build easily on top of other applications you can be sure you're not cut off you can um when applications and code is hosted they can be hosted by anybody and can't be turned off as long as there is one single host available so it's Unstoppable and that's where we want to be is a very creative very secure Unstoppable world and what does that world look like it looks like the most beautiful transparent Cloud on a summer day that you barely even see because the cloud is out there but it is so light and so thin that you almost don't even see it that's the type of cloud that is okay that's not a storm cloud that's the cloud you want where you in which when you marry storage and you with compute and obviously payments are a critical part of that that is what um where where we are going and the vision that um I think we all will benefit from achieving and where is fluent stand in this we've launched the peer-to-peer Network so the peer-to-peer computation network is live it functions the language Aqua which allows the native composition of peer-to-peer applications is live it abstracts out all the complexity of um building peer-to-peer applications the peer Discovery the failover that is solved with aqua so you can compose applications with just several lines of code it's a terrific innovation this year we're launching the Dow it's going to be a Swiss Foundation it will govern the fluence protocol and that's where we are right now and then next year we're adding on the compute economy and that's sort of like the file coin to the ipfs and that will allow hosts to be paid and allow open source software providers to share in that hosting Revenue as the code they write is used which is what we think will inspire a terrific amount of code to be on this open peer-to-peer world and lead to ever-growing innovation and so find us at dash.fluence.dev you can find us at fluence underscore project on telegram um and let's think about what kind of world we want to live in we want three companies controlling internet hosting do you want nation state censoring all manners of either applications or Communications peer-to-peer and open source is the only way we have to prevent that world from happening and so let's think about you know our mission here is going back to Tim berners-lee about the goal of the web is to serve Humanity we don't even know what might be coming when Tim created um the HTTP protocol do you think he could have imagined Uber no chance right and so what we're doing is trying to create the platform and the rails that will allow that level of creativity to happen and exist but we have to have this compute layer in order for that to happen so with that um find us at fluence.network um or Discord influenced on chat and we have a booth in the other room so I appreciate your time uh thanks for coming