Next Data Paradigm: Trusted On-Chain Data Jendrik Poloczek, TokenAnalyst - GoerliCon 0|2

all right you ready yeah thanks man so uh the way i could introduce this guy is actually he's from north germany and this morning you know as uh i get afraid of the cold he actually walked outside without a hoodie on so that surprised me i'm like something is up but he's smart because you know you're an open source hacker right that is correct so i will give you the mic they will give you a big round of applause go [Applause] all right uh can you hear me yeah cool so my name is jendrick uh thank you very much for the opportunity to talk to you today it's super my pleasure uh really cool uh so i'm from tolkien analyst uh we're a bunch of hackers six people uh from london and uh what we're doing we're interfacing blockchain data on chain data uh completely agnostic so we're not ethereum only but we also support bitcoin of course uh yeah so if you want to see what i'm up to you can follow me on twitter made with t mostly posting about mechanical keyboards if you're into that as well it's going to be cool otherwise yeah so here's the gist of what we do so we are processing raw blockchain data so here it's an example for ethereum so what we do is we classify address labels uh we can say okay this is a human this is a bot this is an exchange this is a smart contract uh what kind of crypto asset and what amount of what amount of is transferred and then of course classification why are we doing this who are our customers so we're um financially backed by hedge funds so completely different space people who are gambling with money and they want to know what's what's going on in the blockchain of course so we're not a typical blockchain company per se so it's more of using the blockchain to extract the data so bear with me so these are the use cases so we are tracking exchange in an outflows big movers token treasury liquidation so if people raise a lot of money on the ico smart contracts that we can see okay they're liquidating it for whatever reason anonymous project company kpis for instance what's pretty interesting right now on the finance space is defy defy um so it's basically kpis uh there are a lot of projects going into all different kinds of spaces lending platforms stuff like that they have their kpis as well so they're companies they have to make profit so what they're mostly not looking into is what data is on the blockchain and this is why we're going there and extracting all these kinds of information data for them as well so and then transparency reports so basically like general reports what's going on in this space how much money is transferred but also what are the weird things that happen on the blockchain as well and then doing some research so yeah quite fast so this is what we're up to in the media so we're working with newsletters for instance dire we have some research with dyer with uh bit max they're pushing out a lot of research posts regarding also like yeah investing and we did a small research on the nonces the non-space which is not distributed in bitcoin equally which was pretty interesting and then we're also working a lot with node client software so we run a bunch of parity nodes and geth notes of course ourselves and we came across all the different quirks that you have to overcome to integrate these nodes into an ensemble of reliable of a reliable cluster of nodes okay cool so now let me talk about um trusted data uh since so i'm a data engineer originally so six years working in all kinds of like big data fast data maybe now trusted data startups or bigger companies and so on all different kinds of fields like from iot to smart home to video a peer-to-peer video distribution and yeah so my trade is basically data and since a couple of years i'm also interested into ethereum and i started writing scripts uh to extract data i think it was two or three years ago and right now you have a bunch of open source software to extract data from the blockchain which is super amazing it's probably like 10 to 15 different open source projects just to get data out and they're all doing their job more or less good so yeah but you should give it a try for sure um yeah so i was looking into smart contract data because i was or smart contracts um i wanted to know what kind of data can i get out of it or how how does it work the idea of smart contracts is very uh transformative i mean it starts with bitcoin then you had bitcoin script then you were able to write bitcoin script to do like any kinds of not any kind of computations there yet but it was a stack based language which you can use to do more complex locking scripts that was super nice and then vitaly came up with the idea uh of let's let's use a for noise for neumann machine basically a virtual machine the evm to run any kinds of code on the blockchain and that was very transformative and then we came up with small contracts then we came up with standards now we have esc20 now everybody is thinking about esc2 was thinking about ese 20 now we have the seven to one and crypto collectibles and every new standard and every new idea is basically shaping the next big thing uh which is super interesting and also with the with the hype cycles it wasn't mount gox i i remember i was buying bitcoin on mount gox and i was also one of the guys who lost money on mount gox basically when it was hacked and um that was the first wave and then the next big hype was basically when coinbase was there or kraken and all the the other new exchanges which transformed our thinking like how can we buy cryptocurrency how can we use it which is super important because user experience i think is very underestimated in the space and maybe the next big cycle is cards for instance cards which you can pay with on the adm which is way more important than anything else right now in the space i think so saying that trusted data coming back to that so big data fast data and trusted data i see that as a next paradigm shift because there's so much data on the blockchains and basically you can look at it on the block explorer but it's just a small like view on the blockchain and it's not it's not like you can run queries or something you cannot say okay who owns owns the most blockchain uh who owns the most bitcoin who owns the most ether or who is transacted uh not in the last year or something like that that is the real power and this is something that people can do when they have access to it so yeah so i talked about transformative ideas so we have to think about okay what's the next big thing um it's it's crypto collectibles then we have like die and what could be next and what we underestimate in my opinion is you x and try the whole trusted data or the data aspect of it because we're generating a lot of data but we don't look at it like from a big picture point of view so what i also put on here is the all-seeing eye and i just want to put this all into perspective because we are talking about this we're talking about privacy we're talking about uh generating data and we're talking about the the the bad guys i don't know chanella's elliptic us maybe and uh we have to see from a bigger picture because there's nsa out there there's they can basically read everything um and this is something maybe it's an eye opener for for uh p for people uh so on off chain data so we're doing on chain but off chain is basically all the other data that's out there traditional data which is basically your facebook profile twitter profile and whatnot and basically what is about to come is basically joining this pools of data so that means that any address that you hold can be basically joined to your user profile and then people know exactly what you own and can basically target you via advertising or something like that and this is a very profound thing because everybody has basically access to these blockchains right i mean everybody can extract the data out so now i'm talking about power and information and information asymmetry and transparency for governance so there's this paradox on the one hand we want to become we want to blockchain to become transparent it's kind of transparent you can go on a block explorer you can go on ether scan and you can see the smart contract but there's so much things that you have to overcome to really be independent to figure out what the heck is going on so and these are kind of kind of the layers uh so basically the ground layer would be peer-to-peer network you have your client which is super hard to install um then you have to sync it up that's also hard then you have to figure out a bit okay what are the consensus rules then okay transactions from here it's it's standardized right this is all standardized it has to be standardized but everything that comes here is like completely customizable because we're dealing with the touring complete language or evm here so we can think about all kinds of computer programs that have all different shapes and colors and methods and events and whatnot so every smart contract is completely custom and it's very hard to access so what we can do is we can create standard co which is for instance the ec20 token or seven to one and then we can integrate it to other entities for instance exchanges so you can trade an ese 20 on an exchange or a 721 or you have ox for instance as a layer but in order to understand what the company is actually doing or the developers because the developers are in charge here basically because they can define how the smart contract looks like and what do i what do i show basically the investors or the people or what do don't i show to the investors and the people that was really interesting for me because when i was looking on learning solidity to read smart contract code it was an eye opener for me because i could go on ether scanner i could read small contract code and then i could understand okay this token is actually mintable i did not know that before because nobody told me but now i can see it in the code so we have to understand that the transparency is super important otherwise governance will not work you always have to trust people that they do the right thing no matter how decentralized the smart contract is uh yeah and then what's what's kind of interesting so um yeah we need standards an esc20 token is not an esc20 token so it's just an interface that it behaves like an ese 20 token but in the back end it can sell my grandmother basically can call any kinds of code right it could be a smart contract call to another smart contract which is doing something else when i transfer an ec20 token because the implementation can be completely different from what it says it is okay so here are the weird quirks that we found just as a like a brain teaser i would say maybe so um working with parody and geth we figured out some stuff that we had to overcome in order to get the data out and when i mean get the data out i haven't shown i haven't talked about it did but on this slide which is pretty interesting so what we did in december we were initiating we were instantiating 60 parity clients just to extract the whole ethereum blockchain and when i mean the data i mean everything i mean uh call traces i mean state divs everything so um and it we needed to spend three and a half k to do this in five days just to put put it in perspective and the data in binary format is like one one and a half terabytes big okay so now about the quicks so uh for instance there are different call traces and different parity versions we found it out for some transactions it's a minor thing but it would be better if i mean first off i mean parody and gether are doing a great job it's absolutely amazing we're big fans of parody because it's faster it's more stable and it is always in sync it's really cool and i know that the trace functionality is also like something that's new to parity gap for instance doesn't have it but um we really rely on it and it would be cool if it would be more consistent but of course we know it's like experimental the whole thing the whole space is experimental so then we have reorganization stuff so for instance if you subscribe to the blockchain and there is a reorganization happening you don't um you don't get it from the subscription that there was a reorganization happening so you have to basically find your way around it how to do it so in order to get the blocks from the right canonical canonical chain uh which which is also a bit weird to deal with and then there's some are the other things so for instance the rsv fields uh and transactions are not consistent so they're different in parity different in infor and different and gath there's this is just like type inconsistency uh like how the values are presented and then different error responses so that makes it even harder to deal with the clients and then it's not type safe so i'm a big fan of type safetyness and it just helps to keep the data and in integrity so that would be very very cool i know the whole space is experimental and because of moving fast it's super nice to have a json interface json rpc but the fact that this is um this is should be used as a schema or a standard it's probably better to put types there in order to not uh to prevent any mis misunderstandings so this is like a bitcoin graph so we're dealing with streams we have low latency streams we get our blocks we get our transactions it's go all going through the pipeline we're doing confirmation checking from different we're using all the blocks and transactions from different nodes uh we're doing the checking we put them into other data streams do some aggregates on it uh we're we're also putting the data into graphs and this is just the bitcoin graph so you have utxos you have tx transactions you have coin bases you have miners and then you have addresses which on the keys to the to the unlocking to unlocking the utxos and this is just a very simple graph it is way more complex if you if you do it for any kind of thing in bitcoin so here we're just using the we're just scoping it down to the paper to public key hash not to the pay to script hash which is more like like a script to to unlock or lock uh the utxo but it can get very complicated but having this we we are able to trace trace the money through the graph and so what we're also doing right now or what will be great is we're having the call traces there are a lot of apis out there there's this reversal lookup service called four bytes which allows you to put like the signature of the method into the database and then you get basically the the method name out and what we can do then is we can build a graph of smart contracts which are calling each other so this is what you want to have basically right to understand which oh time's up okay just uh very quick wrap up here so we have the infrastructure out um we have a low latency data stream you can subscribe to it we have an sdk it's called npm install token analyst sdk and with three lines of code you can basically get transactions you get labels you get price um yeah and we can build cool prototypes with it and docs and we're hiring so we're six people team it's an absolutely amazing team i love to work uh a token analyst uh absolutely great great people please write me an email if you're interested into that we're also looking for uh right now front end engineer data engineer cool thank you very much okay