Physicist and technologist Giacomo Zucco, is one of the greatest Italian blockchain experts.
Many people state he’s the most knowledgeable.
He currently works as the Director of the BHB Network and a consultant for Blockchainlab Switzerland.
Let’s start with the most compelling news.
I guess you followed the crash of bitcoin and other cryptocurrencies. Do you think it has anything to do with the various announcements made by Google, Facebook and Twitter regarding the advertisements bans on their platforms?
I do not think that the recent bitcoin price correction, one of the many in the almost ten-year history of this asset, has anything to do with the announcements of these various social platforms related to the marketing of tokens and crypto assets.
Unlike altcoins and tokens sold in ICOs, Bitcoin does not need active marketing campaigns. From 2009 until today, Bitcoin has spread thanks to technical merits, peer review was done by experts in this field and word of mouth within a passionate community.
A spontaneous spread …
Not being able to follow a structured marketing process, open source and/or decentralized technologies often follow this path. There has been no campaign (based or not on social media) behind the adoption of protocols such as the Internet (TCP-IP), E-mail (SMTP, etc.), World Wide Web (HTTP), Digital Signature (PGP), Bittorrent or Git. The adoption has simply happened, slowly and gradually, based on the merits of the technology.
So it was and will be, for the Bitcoin protocol, which will follow this pattern. Even the assets connected to the protocol (bitcoins, homonyms of the protocol itself) are adopted accordingly. The decisions made by these social media giants regarding the campaigns on tokens, however, can help reduce the propagation of altcoins and ICOs, which rely on active marketing. The bitcoin price correction is a normal consequence of an excessive upward cycle, identical to the many already seen in the past.
What is the Bitcoin Evangelist community discussing at this moment? What progress is being made when it comes to the technological development? And what is missing?
A lot of enthusiasm and focus is obviously still placed on the effective adoption of the “layer two” protocol: Lightning Network.
The specifications have been finalized, and after years of testing, it is now finally possible to use this protocol in practice, as indeed it is happening (the number of Lightning nodes present on the network already exceeds the validating nodes of the various altcoins). But now we need tools that can be used by everyone, not just the tech savvy: LN compatible mobile wallets, (coming out next week the Android Eclaire wallet, by Acinq, next month Neutrino, by Lightning Labs, and in the next quarter probably the versions LN of GreenAddress, Electrum and Ledger), systems for managing offline payments (impossible today), tools for integrating the new protocol with existing systems, and so on.
There is a lot of developing work to do when it comes to user experience, integration, simplification, standardization, and adoption.
What else keeps us up at night?
A second very important and debated topic is that of future changes to the internal “smart contract” system of Bitcoin.
For example, changes to the definitions that are still a little insignificant for the non-technical user (MAST, Taproot, Grafroot, Schnorr Signature Aggregation, Schnorr Scriptless Script), but extremely relevant in terms of flexibility, scalability, and privacy of the “contracts” that bind the transactions.
A third theme is that of the so-called “sidechains,” chains separated from the main blockchain of Bitcoin, but based on the same asset instead of new alternatives, to maximize both technically and financially the synergy with the current standard.
In May it will be launched Liquid, a federated and “trusted hardware“-based flavour of sidechain, which will offer much higher scalability than the main blockchain, as well as greater privacy (Confidential Transactions, Bulletproof), greater flexibility of contracts (Simplicity) and support for native assets (Confidential Assets).
The launch of Rootstock, a federated sidechain that will replicate the operation of Ethereum on Bitcoin, is also close (in reality there’s not much enthusiasm around it, because most “bitcoiners” do not see how desirable it is to replicate Ethereum’s functionality).
Completely decentralized sidechains (and therefore not federated) are still a bit far: there are challenging problems to be solved.
The security topic?
There is much talk about more professional and advanced tools for the secure custody of bitcoin, both at the individual level and at the level of organizations and institutions. Better hardware and software wallets, better practices and procedures.
Often we hear critics about cryptocurrencies but praises about the blockchain being a disruptive technology of the future. But is it possible to separate the two?
No, it is not possible, unless we adopt definitions that lose any distinctive meaning and mess up the semantics. A blockchain needs a native “digital gold” to work because without such an asset it is not clear how to reward the anonymous “miners” who solve the problem of double spending.
Without such a reward there is no hope that people will use important amounts of energy to keep the blockchain alive, and without this investment, the characteristics of immutability and univocity of the public ledger of transactions are completely lost.
The blockchain needs bitcoin to work. But to make a “digital gold” system work, you need a blockchain (at least at the “first layer” level), because you need to solve the problem of double spending without resorting to any third central party… so if bitcoin didn’t exist, blockchain technology would be useless. Bitcoin needs the blockchain to work as well.
Why do we need blockchain in our everyday lives?
As mentioned above, it will mainly serve to move bitcoins. Not so much for small and fast transactions (for those we will mainly use different layers of “Bitcoin without blockchain,” such as Lightning Network), but for slow settlement transactions and large amounts. Secondly, it will serve to move other assets, other than bitcoin, but defined on the same protocol: in a certain way, they will be the digital equivalent of derivative contracts, options, voting rights, dividend rights, royalties, discount coupons and so on.
Thirdly, Bitcoin’s blockchain can be used as a “temporal anchor” to ensure decentralized timestamping for documents, contracts and other types of data. The Bitcoin protocol will become, if the experiment is successful, that part of the Internet that manages value, and the Bitcoin blockchain will remain the “central nervous system” of the protocol.