Fantom, a fast, scalable and secure DAG-based smart contract platform for real-time cryptocurrency payments, has announced recently a research partnership with the University of Sydney, including a donation to the University’s Faculty of Engineering and Information Technologies.
Dr. Ahn Byung-ik, CEO of Fantom Foundation, expressed, "South Korea resembles a man on a mission: despite occupying less than 1% of the world’s population, the tech-savvy nation has displayed a voracious appetite for digital investments, accounting for over 30% of the world’s cryptocurrency trading volume. Several signs have pointed to continued growth in the region: Jeju Island is being established as a dedicated economic zone and crypto hub for the burgeoning digital asset sector; and the South Korean government has also created a 5 trillion won budget to boost technological innovation, with a particular focus on developing blockchain technology".
Korea IT Times had an interview with CEO Ahn about Fantom Foundation's role in the inherent potential of the fast approaching technological revolution.
The following is an interview with Ahn Byung-ik, CEO of Fantom.
South Korea has featured prominently in the crypto and blockchain scene its friendly and savvy investor community. What are some of the cultural and economic factors that have pushed the nation ahead in the adoption curve?
Industry watchers have observed South Korea’s meteoric rise as it established itself as a powerhouse in the crypto and blockchain arena, and this at a time when many regions have only begun to dip their toes in an industry famed for its volatility. The nation’s captivation with cryptocurrencies is not without cause: A highly wired society, a digitally savvy populace and a voracious appetite for informed investments set the gears in motion for South Korea’ crypto explosion.
For one, the stateless status of cryptocurrencies holds a unique appeal to a nation that remains conscious of its vulnerability on account of the 38th parallel. South Koreans also traditionally enjoy a strong entrepreneurial culture, exhibiting a penchant for equity derivatives, in part due to the fact that investors could make leveraged bets. Demographic density also played its part with Seoul boasting twice the population density as compared to New York City and four times that of Los Angeles, paving the way for the crypto fever to hit the masses, even grandmothers made their way to placing bets on the virtual economy.
How does South Korea compare to other crypto hotbeds such as the likes of the US and Japan, with respect to the maturity and acceptance of the technology?
To reach a fair comparison between the countries one needs to consider also their relative population size; South Korea population stands at a modest 52 million as compared to heavyweights such as the United States or even Japan. Even so, South Korea has been holding her own; accounting for 30% of all cryptocurrency trading despite representing less than 1% of the world’s population, landing the spot as the world’s third largest market in the world for Bitcoin trades. Whereas the crypto boom could be a said to be a product of fortuitous timing, South Korea has set itself apart from other nations in the adoption of reflexive regulations aimed at bringing the nation to the forefront of a digital economy.
While the nation outlawed token sales earlier on in 2017, the move was designed to protect its citizens from corrupt practices that were plaguing the unregulated landscape, and the government has since been hard at work building a compatible regulatory framework. As more countries ride in on the action, South Korea has not only emerged as a forerunner but continues to maintain its lead with tremendous strides in both the public and private sector; The government has announced a 5 trillion won innovation budget, , with a particular focus on the blockchain and AI sector, and top chaebols such as Samsung and LG have also jumped on the bandwagon.
What is the significance of institutional interest in the market as established players enter the crypto scene?
The entrance of institutional players has been a welcome change as established bodies lend their reputation to the decentralized technology, signifying a growing serious interest as the industry’s potential comes to light. With the wave of institutions embracing the technology, they bring to the table long standing financial practices and frameworks that could benefit a blockchain industry that is arguably still in its nascent stage.
At the same time, companies need to be cautious about being too hasty and jumping on the bandwagon without being mindful of whether they truly stand to reap the benefits from blockchain. The same principles apply when considering if the technology serves to fulfill the business objectives or advance the market position for the organization, and while funding often provides the leverage for companies looking to scale at a global level, these need to be meaningful applications beyond a single white paper.
Fantom professes itself as the world’s first DAG based smart contract platform. Briefly, how do DAG-based projects differ from traditional blockchain projects in tackling the industry's most pressing issues such as scalability?
While blockchain holds immense potential as an immutable ledger, the industry has struggled to move away from anecdotal accounts and actually bring transactions mainstream. The same roadblocks persist: the lack of real-time transaction settlement; the question of scalability; as well as concerns of standardization. It was based on these challenges that Fantom was born.
At Fantom, we focused on addressing the most pressing issues facing the industry by presenting a new implementation of Directed Acyclic Graph (DAG)-based consensus, and the marked improvement in terms of both scalability and versatility of existing DAGs enables Fantom to build an ecosystem that could be deployed at scale in the real world. By introducing a new model of sophisticated technology that could independently process hundreds of thousands of transactions per second, DAG-based solutions cleverly circumvent the bottleneck effects of traditional blockchain projects and continue to advance the industry towards a mainstream setting.
What are some of the industries that have emerged as clear beneficiaries of the decentralized technology, and provided the strongest use cases for blockchain in today’s market?
As blockchain continues to make inroads in a myriad of industries, there are a number of industries that have established themselves as clear beneficiaries besides the banking and financial sectors that have traditionally been associated with the space. These tend to be industries that continue to meet with challenges that current technologies fail to address and turn instead to blockchain as the solution in striving for transparency, streamlining of processes, and ultimately in unlocking the potential of the technology to remove existing inefficiencies. Some of the best potential uses cases lie in food-tech, supply chain management, real estate, energy, and point-of-sale (PoS) processing.
In matching with these industries to create real use cases of blockchain, it is important to consider the synergies between the two; how blockchain advances the technology towards a modernized front, and in turn how the industry percolates blockchain to the masses. Projects will have to find the right partners in relevant industries to build out more than just a computing platform or protocol layer. Irrespective of industry, it is only by enabling a viable ecosystem can there be viable and sustainable traction for the adoption of blockchain in today’s market.
What is the impact of regulatory announcements on the industry, and how will the market respond to meet the evolving landscape as governments announce their presence?
As the focus on cryptocurrencies and blockchain intensify in South Korea, the government has also been ramping up their efforts to structuralize an industry that is in a constant state of flux. In the midst of the crypto-frenzy cool down, such moves are a welcome sign that the industry is maturing not only in terms of its technical infrastructure but also in advocating for greater standardization surrounding issues of security and user-friendliness.
More importantly, regulatory bodies will need to partner with industry players to anticipate and prepare for the emergent needs of the burgeoning technology, setting the tone for a conducive environment where the industry is able to develop and thrive without hampering the quest for innovation.
How would a reversal of South Korea’s ICO ban affect the crypto scene in terms of increasing competitiveness and expanding the market?
As one of the largest crypto markets by sheer volume alone, South Korea has raced ahead of its peers in the adoption curve as a global leader in the innovative space, and this is similarly reflected in its forward-looking regulatory stance. With the government potentially considering a reversal of the ICO ban as they attune to the maturing landscape, the move will undeniably lift the weight for companies who look to leverage on ICOs as the solution to scale. That being said, it has also become increasingly important for the crypto market to consider and address the challenge of liquidity beyond a myopic discussion of ICOs. Liquidity has surfaced as the unseen monster for blockchain projects who have successfully scaled the proverbial mountain only to find a bigger problem around the corner - navigating the path to a sustainable future. While it is true that ICOs offer a boost to projects in terms of flexibility, the issue of liquidity continues to loom at large as companies seek to gain traction in the wider market.
What will it take for blockchain to claim its place in the mainstream, and what is the role of industry players in driving adoption of the technology?
Despite blockchain’s quick rise to prominence, scalability concerns have endured as industry players cite growing pains with complexity, limited speed, and increased expenses. In such an instance, DAGs have claimed the spotlight as the solution to bringing blockchain to the mainstream; often regarded as the younger sibling of blockchain or blockchain 3.0, it boasts of improving the low throughput, high costs, and compromised security that have plagued existing platforms.
By appreciating their role in ushering in the next digital revolution, industry players will have to put forward their best foot and focus on the most promising subjects to prove success in today’s crowded market. Companies need to be motivated by the need to provide an effective solution to blockchain’s weaknesses, and those who can do so first will make a difference in bringing about the level of success long envisioned for the technology.
Critics have pointed to the lack of real world applications despite blockchain’s promising premise. What are some of the current challenges the blockchain industry faces in South Korea?
For most companies, the value of blockchain still lies in its potential more than its real-time use, and overcoming this narrative will be one of the technology’s most significant challenges. The key is not in building entirely new blockchains but to rapidly develop alternative solutions to the systematic problems have contributed to the rise of blockchain technology.
As real-world applications and user-friendliness come to dominate the conversation for blockchain, the industry will need to learn to prioritize these concerns in order to expand the digital horizon for the emerging technology. Blockchain can no longer be an insular enterprise but will instead evolve to meet the rigorous demands of the consumer. Projects such as Byteball, Fantom, and IOTA are validating that alternative technologies such as DAGs offer strong competition to traditional blockchains; With its unique programming language focused on scalability, Fantom’s OPERA chain is capable of processing up to 300,000 transactions per second, placing emphasis on building platforms that both consumers and enterprises alike will be able to use in their day to day lives going forward.
As 2018 draws to a close, what lies in the future of blockchain for South Korea and beyond?
Currently, South Korea stands at a very exciting position in the world of blockchain; its reputation as a blockchain hub has seen cities such as Seoul and Busan paving the way towards becoming global smart cities. Interest is also strong beyond the public sector, as it is not only entire cities or regulatory bodies that will enable the industry to progress to the mainstream: adoption from large corporations such as Microsoft, Hyundai, SK Telecom, LG U+, Kakao, and dedicated blockchain consortiums, like the Open Blockchain Industry Association (OBCIA), will also play a key role.
As South Korea moves beyond 2018, its consistent efforts will place the island on the map as the industry sees greater heights in innovation, adoption, and acceptance amongst its audience.
What is next for Fantom in 2019?
Since the creation of blockchain, the same hurdles have persisted in the existing ecosystem with players putting forth a plethora of proposals aimed at resolving the blockchain trilemma: that of scalability, security and decentralization. In addressing these concerns, the industry has consistently focused its attention to building on traditional blockchains, with seemingly no end in sight. Meanwhile, the secret industry leaders are those that have been rapidly developing alternative solutions to the systematic problems have contributed to the rise of blockchain technology, and Fantom among them, has emerged as the lead in championing the third generation of distributed ledger projects.
Fantom has rounded up an exceptional year as it traces its path from its inception back in February and a fundraise in June to a number of enterprise partnerships secured in recent months. And the momentum looks to continue into the new year; In 2019 Fantom will release the consumer ready version of its protocol to the market; build a strong developer community that will not only drive innovation but overall blockchain development; as well as encourage the mainstream adoption of blockchain and cryptocurrencies through strategic partnerships and industry collaboration.
While bearish sentiments have maintained in the current crypto market and trained attention on significantly larger projects, it is Fantom’s belief that the key to succeeding in today’s evolving market, whether that comes from DAG technology or otherwise, will be whether or not projects can effectively provide a solution to blockchain’s weaknesses — and Fantom is set to do so first.
About Dr. Ahn Byung-ik
Dr. Ahn holds a Ph.D in computer science from Yonsei University and has been awarded the President Award for his successful IT business. Ahn is a contributing writer at Fortune Magazine and has been featured in South Korea's major business media outlets. In 2010, Dr. Ahn established successful food-tech platform SikSin, which has since acquired over 3.5 million downloads and 22 million monthly page views. He currently serves as President of the Korea FoodTech Association, which consists of over 90 companies as its members.