Episode 32: Blockchain and Cryptocurrency for Data Science
Download MP300:00:00 Dr Genevieve Hayes
Hello and welcome to value driven data science brought to you by Genevieve Hayes Consulting. I'm doctor Genevieve Hayes. And today I'm joined by Luke Willis to discuss the blockchain and cryptocurrency. Luke is the self described DAP UX guy. Here's a Web 3 developer.
00:00:20 Dr Genevieve Hayes
With extensive front end and UX experience, and he's also the founder of the coin press, where he writes a regular newsletter.
00:00:30 Dr Genevieve Hayes
Hosts the Coin Press Podcast and helps others make their Dapp ideas a reality. Luke, welcome to the show.
00:00:38 Luke Willis
Glad to be here. Thank you for having me today, Genevieve.
00:00:41 Dr Genevieve Hayes
Depending on who you speak to, blockchain and cryptocurrency are either the way of the future or the scam of the century.
00:00:52 Dr Genevieve Hayes
Few people would be able to tell you what either of them actually is.
00:00:56 Dr Genevieve Hayes
And that includes data scientists for whom data and technology are a way of life. I personally believe blockchain, along with generative AI, is going to be one of the more important technologies of the next decade.
00:01:12 Dr Genevieve Hayes
But even I don't fully understand it, which is why I'm doing this episode and why I'm very grateful for you being here, Luke.
00:01:20 Luke Willis
Happy to hop on and talk about it. There's a good chance there's some things I don't understand as well, so we'll we'll get through it together.
00:01:29 Dr Genevieve Hayes
The thing with blockchain is it's such a cutting edge technology that many of the more traditional educational institutions haven't had time to create courses about it. Which brings me to my first question. Given how cutting edge this technology is, how did you first become involved?
00:01:49 Dr Genevieve Hayes
In blockchain and Web 3 development.
00:01:52 Luke Willis
Sure. Yeah, good question. I mean, blockchain gets.
00:01:56 Luke Willis
A little bit of.
00:01:56 Luke Willis
A bad rap, as you know, a lot of people say it's still new still early, but Bitcoin was created in 2009, so we have 14 years behind us and for many other technologies, that's enough time to reach a a certain level of maturity.
00:02:12 Luke Willis
Right, but blockchain has a lot of complexity to it. I have been working in the space for a little over 2 years now and before that I had been having various conversations with some roommates and friends who were working in this space. So.
00:02:30 Luke Willis
I had a limited understanding of the inner workings of blockchain. Basically conversational knowledge, and then two years ago I I threw myself into it to really ramp up my understanding, which is when I started the coin press and that was so that I could talk to people on a podcast.
00:02:50 Luke Willis
And and really understand the expert opinion and get my own thoughts about it out and vet that against people who were much smarter than I am. So it's been a very good experience. And in that time I've been doing the the podcast and things, but also built a few Daps as well. So it's been.
00:03:09 Dr Genevieve Hayes
And how did you learn those skills? You needed to build those gaps because I know there isn't a Dapp building 101 university course out there.
00:03:18 Luke Willis
That's true. I'm a developer by trade. I've been building apps on, you know, traditional web two to use the the terminology here. Infrastructure for a decade or so. And so I'm very familiar with, you know, build.
00:03:34 Luke Willis
And standard front ends and APIs and database whatever right? So what I realised in my research and digging into blockchain is that it's very similar if you've done web development and you're familiar with creating a front end and talking to an API and the database and all that.
00:03:54 Luke Willis
Crypto and and blockchain is really just a.
00:03:58 Luke Willis
A different solution to the same problem, and there's a lot more nuance to that, which I'm sure we'll get into, but you can think of it as the the data and the data availability layer of your app, and you're you're pretty close to the truth there. So as far as skills go, if you've done web development, it's not a huge leap to get there.
00:04:18 Dr Genevieve Hayes
What programming language do you use to build apps?
00:04:22 Luke Willis
So I use a variety. Lately I've been doing a lot of React JS on the front end, so JavaScript TypeScript depends on the need there and then for the back end I've done a little bit of everything. So I've done a lot of C sharp.
00:04:36 Luke Willis
A lot of.
00:04:36 Luke Willis
Java, some node, JS, couple other things for one or two projects.
00:04:41 Dr Genevieve Hayes
So it's just regular programming languages. There's no special web three language.
00:04:47 Luke Willis
Well, there is. So when we get to to blockchain, it does depend on which blockchain you're building on. If you're building on Ethereum, then the language to use is called Solidity.
00:04:58 Luke Willis
But it's very similar to JavaScript, there's just, you know, more nuance to learn and different requirements of when to use specific keywords, different ways to optimise it and that sort of thing. But that can all be learned with practise and there's also great templates out there for building on those chains.
00:05:17 Luke Willis
For me, I've been building on Koinos, which is a newer blockchain.
00:05:21 Luke Willis
And so they're a a wassum blockchain instead of EVM. For that, I've been using assembly script which is again very similar to TypeScript, JavaScript kind of that that family of languages.
00:05:34 Dr Genevieve Hayes
Over the past few minutes, both of us have dropped quite a bit of jargon, so I think it's.
00:05:39
It's the best.
00:05:41 Dr Genevieve Hayes
Probably a good idea if we take a step back and just define a few terms before we go too far and lose the entire audience. I guess the most obvious question is what is the blockchain?
00:05:55 Luke Willis
So a blockchain is basically.
00:05:59 Luke Willis
Actually a bunch of computers working together on a network and they're doing a rather specific task. But to to create and launch a blockchain. Really all it is is writing some specific software that knows how to talk to other computers.
00:06:19 Luke Willis
And then running it on your own computer, getting your friends to run it on their computers hosting versions of this software in the cloud, wherever it is you want to put it.
00:06:29 Luke Willis
And then each of those computers that's running the software package, it's now a node on the blockchain. And so in this code that's running the blockchain, it is making peer to peer connections with all of the other nodes in the network. And so if one node goes down, it's very fault tolerant.
00:06:51 Luke Willis
In that every node in the network is discovering new nodes and knows about other nodes, and they're all checking each other's work. So if one node says hey I you know I'm I'm adding to the blockchain. Here's more data.
00:07:07 Luke Willis
All of the other nodes around them receive that in a broadcast and they start checking that it's correct and then they repeat it out to the network and so there's a lot of additional work when you compare that to, you know, a traditional. You know, I'm running one computer, I have one database instance.
00:07:27 Luke Willis
Now we have who knows how many nodes doing the same work over and over again. So that's where you get. You could say inefficiencies, but it is a.
00:07:39 Luke Willis
It's just it's a trade off, right? You get a lot of fault tolerance for that inefficiency. So what you have for a blockchain? What, what a blockchain is, is it's just a network of nodes that are all agreeing to the same rules of how to add data.
00:08:00 Luke Willis
To a database and so that database is called a blockchain and that is because data is structured in blocks that are produced every few seconds. It depending on which chain you're on, they might be longer or or you know smaller blocks or bigger blocks or more.
00:08:20 Luke Willis
Tap it or they take a few minutes to to produce a block. But every time a node successfully produces a block and broadcasts it.
00:08:28 Luke Willis
Everybody who validates that block and agrees that that's a valid chunk of data, they just chain it. They they add it to the database and then at any point in time you can look at the the state of the database which has been constructed by this adding of blocks onto the chain.
00:08:49 Luke Willis
So that's where the name comes.
00:08:50 Dr Genevieve Hayes
From as you're describing that the first thing I thought of before you even said database was. This is just a distributed database except except instead of Google or Amazon or whatever owning.
00:08:58 Luke Willis
Yes. Yeah.
00:09:02 Dr Genevieve Hayes
All the different databases in the network, they're individuals computers. Is that correct?
00:09:10 Luke Willis
That is correct. Yeah. So the the only thing that really makes it unique, I mean, there's a lot of unique properties for different blockchains, but the the thing that really sets it apart compared to a distributed database owned by Amazon is that it is a permissionless network. So anybody can download the software.
00:09:31 Luke Willis
Run it and connect and start producing blocks on the blockchain.
00:09:35 Luke Willis
You don't need permission from Amazon to join the network and and become a valid actor. And because of the rules that have been baked into the code, even if you join this network with your own client that you create and you try to do things that are malicious, to break the blockchain because of that.
00:09:56 Luke Willis
Fault tolerance and that decentralisation of control.
00:10:00 Luke Willis
You can't do it right. If you say no, I'm going to add this fake data into the blockchain. I'm going to cheat everybody out of money and and that kind of thing. All of the other nodes in the blockchain will see that you're lying and they won't allow your data, and they'll punish you and and do all kinds of things to prevent you from doing.
00:10:20 Luke Willis
Bad things to the data.
00:10:22 Dr Genevieve Hayes
What happens if I own over 50% of the nodes in the blockchain?
00:10:27 Luke Willis
So that depends on the blockchain. Each one has kind of different things that can happen in that situation.
00:10:35 Luke Willis
And it also depends on kind of the the economics of of the chain. So certain block chains use what's called proof of work, which is basically however much computer power you're contributing to the network means that you control that percentage of the the network. So if you have a really beefy machine.
00:10:57 Luke Willis
For you've written really clever code so that you can do things more efficiently compared with.
00:11:02 Luke Willis
People then you may be producing more computer power, or we say hash rate and so you would make up a larger percentage of the network on a proof of work network. Others use proof of stake proof of burn. There's a bunch of other more nuanced ones where.
00:11:22 Luke Willis
Your percentage of the network is based on your ownership of the token.
00:11:28 Luke Willis
And so, without going too far down that rabbit hole just yet, the token is just cryptocurrency. It's the money that you own as a percentage of the network. And so one of the things that's on the the database, the blockchain, is who owns what.
00:11:48 Luke Willis
Money, basically. And so if I send money to you and you send money to me and you know whatever, that's all great. But that makes up your stake or your percentage of the total amount of money in the system.
00:12:02 Luke Willis
And so for those blockchains, just adding more computer power, you won't be able to do anything to take control of 51% of the network and and change the outcome. You would need to actually acquire 51% of the tokens in order to to do something malicious.
00:12:22 Luke Willis
But yeah, regardless.
00:12:24 Luke Willis
Of and that's called the consensus algorithm. Regardless of what consensus algorithm the the network is using. If you control 51% or more of the whatever the limiting factor is, you can you can cheat. You can say I'm going to add additional data or I'm going to double spend these tokens or.
00:12:46 Luke Willis
There's a lot of different things that you can do and get away with, so that's why when we talk about 51% attack, it's something to be avoided for sure.
00:12:55 Dr Genevieve Hayes
I would say it would presumably be impossible with the older, more established blockchains, but if someone were, if someone like me were to invent a new blockchain with limited taker up, I could quite easily control 51% of it.
00:13:06
Right.
00:13:12 Luke Willis
Certainly. Yeah. And if you're so. So, yeah. For existing networks, if we're talking about Bitcoin, which is, you know, the first network and has a proof of work consensus algorithm, it costs millions of dollars per hour to to attack the network. And so it's not.
00:13:32 Luke Willis
Economically viable.
00:13:34 Luke Willis
Given what you could pull off, it's it's not worth the the trade offs, right? Additionally, if you did that, you'd be devaluing the currency and so you'd lose a lot of money in the process as a result. That a lot of the the concerns here of well, what if that happens basically come down to.
00:13:54 Luke Willis
Is it worth it from a business perspective? Am I am I just going to lose money by doing this and for a lot of things the answer is yes. And so.
00:14:03 Luke Willis
Well, getting back to your your question, which was remind me.
00:14:10 Dr Genevieve Hayes
Controlling 51% of the network and if it's a small enough network, you should be able to do it.
00:14:14 Luke Willis
Ohh yes, yes. Thank you. Yeah, if it's. If you're controlling. If you're creating a new blockchain, then yeah, you you have the power to distribute that token initially however you see fit. And so if you just gave yourself 51% of the tokens and sold the other 49%, then yeah, immediately you have full control of the network.
00:14:35 Luke Willis
And that's not.
00:14:36 Luke Willis
That's not a good place to be.
00:14:38 Luke Willis
Most blockchains that get launched these days come up with some mechanism of distributing the tokens that they'll usually allocate a percentage to the the team, and then sometimes they'll lock up tokens for a period of time and then they'll sell the other ones. And so there there's lots of.
00:14:56 Luke Willis
Things that they do to.
00:14:58 Luke Willis
Prevent that from happening, but usually the thing to look for is what percentage is being allocated versus what percentage is being sold or mined or however it's being distributed.
00:15:08 Dr Genevieve Hayes
Yeah, because if one person holds, 51% would scream out scam to me.
00:15:13 Luke Willis
Yeah, exactly.
00:15:16 Dr Genevieve Hayes
OK. So you've mentioned tokens while you're discussing the blockchain. I show them by tokens. That's effectively cryptocurrency.
00:15:24 Dr Genevieve Hayes
Correct. Yeah. So, so how does that?
00:15:26 Luke Willis
Work. Yeah. So going back to the the database concept, right, it is just a database and when we look at traditional finance.
00:15:36 Luke Willis
Databases. It's just money. It's all just numbers in a database. Your account number holds this value and we can add numbers and subtract numbers and and all that.
00:15:49 Luke Willis
And so with.
00:15:51 Luke Willis
Traditional database. Theoretically somebody at the bank, let's say, could go in and change a number in a database and you know, give themselves an extra $10 or something like that. There's a lot of security controls and audit systems and things that are supporting to prevent that from happening. But.
00:16:11 Luke Willis
It is still all controlled within the bank, right? If if some.
00:16:16 Luke Willis
They made the software wrong or if somebody had the right password, you know theoretically that that sort of thing could happen on a blockchain. You still have this account holds this value, but nobody has the keys to change that. So there's only specific things that can be done.
00:16:36 Luke Willis
Done. Because anything else you tried to do would get broadcast to the network and everyone say that's not a valid thing you can do. So you it would never be accepted as an actual change to the database by the network. You can do it on your own machine all you want, but nobody's going to recognise that.
00:16:53 Luke Willis
You own that.
00:16:54 Luke Willis
Money. So yeah, so.
00:16:56 Luke Willis
So basically if you are.
00:16:59 Luke Willis
If we're talking about tokens and cryptocurrency, what that is is it's just numbers in the database and we use the term tokens because we think of it as like a transferable money that you actually pass around. So the physical concept of a token is a better representation than just saying numbers.
00:17:19 Luke Willis
In a database because you can't just mess with it like you can with numbers in a database, you actually have to.
00:17:26 Luke Willis
Destroy it. Or maybe it's created or it is transferred from one account to another so there's specific things that can happen.
00:17:34 Dr Genevieve Hayes
It seems more like stocks in a company. You know, you buy 100 units of stocks in Apple or whatever.
00:17:41 Luke Willis
Yeah, that that's a pretty good representation. But I mean, again, when we talk about.
00:17:46 Luke Willis
Getting into the the nitty gritty of that, a stock market is just another database, right? So but yeah, it it is. It's a representation of a share in a company where if you hold Bitcoin or east or or whatever, you have a share of the network. So the difference is that.
00:18:06 Luke Willis
A stock is actually a representation of an entity that is creating value in the world, hopefully and your.
00:18:16 Luke Willis
Betting on the the value of what they're creating and what they're producing or how they're serving the world and the economic side of that for crypto, it is there's no company behind the scenes, right? You're just owning a percentage of this network. So from that perspective, it's more like.
00:18:36 Luke Willis
Currency where if you own a dollar that's not like there's no company behind that. It's just the the United States and their creation of this dollar bill and you believe in the promises of the the Federal Reserve.
00:18:55 Luke Willis
And it's useful to you, because all of your stores around your house accept it.
00:19:01 Luke Willis
And so you use it, crypto is is more like that where you know it's it's a dollar. It's not, there's no, there's nothing behind it. It's just the the promises of the network and the rules around it, similarly to how the government has rules of how dollars are used and created.
00:19:21 Dr Genevieve Hayes
So basically I mean with a dollar, the government has convinced the population that this piece of paper is worth $1.00.
00:19:29 Dr Genevieve Hayes
And that's how the whole economy works. So with cryptocurrency, the cryptocurrency creator has convinced the world that one Bitcoin is worth whatever. And.
00:19:42 Dr Genevieve Hayes
As long as.
00:19:43 Dr Genevieve Hayes
People are willing to pay that for it. It is worth whatever.
00:19:48 Luke Willis
Right. Well, and that comes down to supply and demand really like it's it's traditional economics where the it's not really up to the government to say this is worth this much you know.
00:19:59 Luke Willis
They could influence supply and demand by saying you can always come to the government store and exchange $1.00 for a dozen eggs. You know now they've kind of created a a floor price of, you know, this dollar is always worth this much or.
00:20:15 Luke Willis
But if they're.
00:20:16 Luke Willis
Printing too many dollars, they don't have enough eggs, you know? So there's kind of a shell game of how much can we print and how much will people spend and and all those things where on a blockchain, there's no central entity behind the scenes. It's just.
00:20:35 Luke Willis
All the different people participating in the network.
00:20:38 Luke Willis
And if more people want the token, then the price goes up naturally because of supply and demand. And if more people want to sell the token, then.
00:20:46 Dr Genevieve Hayes
It goes down so all all cryptocurrency lives on the blockchain, but I'm assuming the cryptocurrency is not the only use for the blockchain.
00:20:58 Dr Genevieve Hayes
What else can you do with the blockchain?
00:21:01 Luke Willis
So the sky is the limit.
00:21:05 Luke Willis
Servers and databases and it's kind of like asking what can you do with a server in a database. The answer is really whatever you want. It's just a matter of what you code it to do. And so for blockchains, the initial blockchain, Bitcoin really only did money.
00:21:25 Luke Willis
And so they've kept to that.
00:21:29 Luke Willis
But they have additional things that you can do off of the network that then kind of cheat to get additional data in by transferring very small amounts of money around and kind of making the data say things that aren't money. And so they they've basically taken.
00:21:49 Luke Willis
A square peg, which is to build an app that does whatever and force it into the circle hole of a money application where other blockchains, like a therium coin house. The one that I've built on their what's called a general purpose blockchain. So it's more of a a server that you can anybody can code on.
00:22:08 Luke Willis
So when you're building a dapp or centralised application, you're actually coding a, let's say, an API with control over a certain portion of the database.
00:22:21 Luke Willis
And you're deploying it onto the network, and so you can write the code in a Turing complete language, and anybody can then use your code who can access the network so you can build a front end that talks to the blockchain and uses the the smart contract is what we call it that you that you.
00:22:41 Luke Willis
Built or somebody else can build a different front end that talks to yours, or they can just build.
00:22:48 Luke Willis
A statistics dashboard that goes and analyses all the data that is in your portion of the database for your depth and do all kinds of analysis on the data that people using your dapp are are creating.
00:23:04 Dr Genevieve Hayes
So as a data scientist, if I had created a DAP.
00:23:08 Dr Genevieve Hayes
I could extract the data relate from the database relating to my DAP and then do everything I could normally do with normal data. Is that right?
00:23:19 Luke Willis
Right. Yeah. So, yeah, when it comes down to that data science piece, the benefit is that because blockchain is permissionless, anybody can use it. Anybody can see all the data because it's all public as a data scientist, there's a treasure trove of information out there for specific Daps, but also for accounts.
00:23:40 Luke Willis
So you can actually draw. You know you can dig deep onto let's say unit swap, right, and see all the trading activity going on for different tokens on the blockchain or?
00:23:52 Luke Willis
Or you could take kind of a horizontal approach and say I see that these three accounts traded this token and then went and used this other depth that does something completely different and then did this. So because all of the data is public across all the dapps.
00:24:12 Luke Willis
And all the accounts you can do very interesting things depending on how you slice the.
00:24:16 Dr Genevieve Hayes
Data. Also this is interesting. So if there was a distributed database on AWS, unless it was my database I wouldn't be able to get at it. But what you're saying is that I could theoretically.
00:24:28 Dr Genevieve Hayes
Really get all the data for all the depths and analyse to my heart's content.
00:24:35 Dr Genevieve Hayes
Wow. OK, so yeah, is it tabular data or some sort of JSON type blog?
00:24:43 Luke Willis
Yeah. So it depends on which blockchain you're using. The data that I'm using on so it's basically JSON by the time you get it out and so.
00:24:52 Luke Willis
So I believe most blockchains do something similar using our PC is a standard format for like talking to the blockchain, but yeah it's it's basically just JSON Data. It's structured as blocks which contain transactions which have operations which are.
00:25:13 Luke Willis
Records of this account talked to this application and did this thing and this was the result.
00:25:20 Dr Genevieve Hayes
Well, this is really cool. OK, as soon as this episode is over, I want to start trying to get at some of this data. OK, you've mentioned multiple blockchains and you know, everyone knows about Bitcoin and Ethereum, but you're a obvious supporter of Coin Nos.
00:25:42 Dr Genevieve Hayes
Why is coenus your weapon of choice?
00:25:45 Luke Willis
Yeah. So like I said, I I got into this two years ago and the the roommate that was deep into this field, he is one of the Co founders of the group that created the Quintos blockchain. So when they were working on it and I was learning from from the background, I I wanted to to get deeper into it. So that's.
00:26:06 Luke Willis
That's why I started there now I've stayed because of the design decisions that they've made and and what they've.
00:26:13 Luke Willis
Built, I think it's a really.
00:26:15 Luke Willis
High quality piece of software and does something unique compared to all the other blockchains that are out there today. So to explain what that is, I have to go back a little bit and say let's look at Ethereum. Ethereum was the first general purpose blockchain which just means that anybody can code.
00:26:36 Luke Willis
An application that runs on on the chain.
00:26:39 Luke Willis
And they were able to do that.
00:26:41 Luke Willis
That because of the there's a lot of a lot of innovation that went into it. But one of the things that was a core concept is gas fees. So if you start using these, these blockchains, that's something that's going to come up rather quickly. So anytime that you submit a transaction to be included in a block.
00:27:02 Luke Willis
You have to pay.
00:27:04 Luke Willis
To use the resources of the.
00:27:06 Luke Willis
Chain and so on Ethereum. This was called gas and so you can actually bid more gas to get your transaction prioritised and you know have it resolve much faster. But the system is just it's called gas fees and it's just a fee to pay for your transaction.
00:27:26 Luke Willis
And this has been a source of frustration for people ever since Ethereum launched, and every other chain that's followed has basically replicated this design. There have been attempts to, you know, change it or hide it in various things on a theorem and on other blockchains. But Cornos has taken a different approach.
00:27:47 Luke Willis
Where instead of having fees where you're paying with money, with cryptocurrency, you're actually paying with time. So what you have is a an opportunity cost instead of a a monetary cost and the the structure of it is it's called a mana fee or mana cost instead of a gas fee.
00:28:09 Luke Willis
And so mana is the resource that is basically a measurement of time.
00:28:15 Luke Willis
So instead of saying I will pay one coin to submit this transaction. What you say is I will lock up this coin for five days to to do this transaction and so now you've basically committed to not being able to spend.
00:28:35 Luke Willis
Transfer or use that token for additional transactions for a period of time.
00:28:41 Luke Willis
And so there's still, like a real economic hit by doing that, but it allows you to to hide a lot of the the pain that comes from gas fees and and the reason that this whole discussion is necessary and talking about gas fees or mana cost is because.
00:29:01 Luke Willis
You don't want people to just be able to come in and spam the network with whatever data they want. Resources are expensive, and the more data gets put on the chain, the more costly it is to keep the network alive and have things continue to operate smooth.
00:29:16 Luke Willis
So Ethereum, because it is so well used and and everybody is you know, so excited about Ethereum and using the network and there's so many tokens and apps on there, gas can get very expensive, it can be hundreds of dollars to submit a simple transaction for something that.
00:29:36 Luke Willis
A normal user who hasn't been in that ecosystem for you know, for since the beginning, they just can't afford it. So normal people are priced out of the.
00:29:47 Luke Willis
But the the whole idea of gas fees is still necessary. So when we talk about Mana mana cost, it's a totally flipped perspective because instead of having to think about, you know, ohh can I afford the $200 now or should I wait for when fewer people are using the network? So it's only $20.
00:30:08 Luke Willis
Now it's just free. You. You don't have to think about the cost because it's all time and you can hit a point where you know you've used up all your mana and now you're stuck. You can't use the network anymore until you get more and it'll it'll regenerate over time.
00:30:26 Luke Willis
But it's not something that you have to feel in your pocketbook. It's just a a time constraint and this is a a design that we see and you know, mobile games where money is not even a a, a concern instead of it being, you know, are you going to pay 10 gold to open this chest or whatever? It's.
00:30:45 Luke Willis
Are you going to wait 4 hours to open this chest? Right. And then you you click on it, you have to wait for it. Maybe you can spend some gems to speed it up or something, you know. However, that's designed in the game.
00:30:57 Luke Willis
But that's really where this concept comes from. It's it's a real mana is a concept in video games and dungeons and Dragons, and going back and it's a it's a renewable resource that powers your your ability to use magic. So yeah, from that perspective, I'm able to use Cognos.
00:31:17 Luke Willis
For for my daps, for other people's daps without having to think about the money side of it. And so whatever money I put in, I know it's still there after I'm done using the chain.
00:31:27 Dr Genevieve Hayes
Yeah. And so.
00:31:29 Dr Genevieve Hayes
Smaller people who aren't backed by some big corporation. This is gonna be something that's a very real consideration.
00:31:39 Luke Willis
Absolutely, yeah. And and that's where that, that's where it gets really interesting to me because well, it's it's a much nicer experience for me as somebody who holds coins, most people who are coming into the blockchain world don't have tokens. And so they don't, they don't care about going and buying tokens to be able to use some application on the Internet.
00:32:01 Luke Willis
That's an unnecessary step that prevents people from using apps built on Ethereum and other blockchains because you have to have the tokens to pay for the gas before you.
00:32:11 Luke Willis
Can use the app.
00:32:13 Luke Willis
And so you're you're excluding all kinds of people there. And so cornos, I can actually if if I'm a developer and I own.
00:32:22 Luke Willis
Coin. Then I can use my mana to pay for other peoples usage of my my application. So.
00:32:31 Luke Willis
Now I can still just hold all my coin and pay for the mana for any number of people off the street to come in and use my app and actually interact with the blockchain and submit transactions. And it doesn't cost me anything. It's still just my time. Now there's a limit to how much usage I can support.
00:32:51 Luke Willis
With how much coin I have.
00:32:53 Luke Willis
But it's very powerful to be able to say I can support people and and they can use my my app and I don't have to run any infrastructure because it's all just the blockchain. I don't need to host a server, I don't need to host a database. All I need to do is just hold on to these tokens and everything just operates smoothly.
00:33:13 Dr Genevieve Hayes
What I think's interesting is when the blockchain first started to become a.
00:33:18 Dr Genevieve Hayes
Thing, one of the things that I remember reading was that the benefit of blockchain is that it's decentralised, so it makes all of these benefits available to the people. But it sounds like with things like Ethereum where you've got those high gas fees.
00:33:38 Dr Genevieve Hayes
That that the costs of paying for those gas fees potentially?
00:33:45 Dr Genevieve Hayes
Prohibitive to ordinary people who can't afford them. But something like conos by having that manner concept, is bringing it back to the what was originally said about the blockchain that it makes it available to ordinary everyday people.
00:34:03 Luke Willis
Yeah. Yeah, I I think that's a fair assessment because.
00:34:08 Luke Willis
Etherium, yeah, it's not accessible to normal people. There have been other blockchains created that still use this gas concept, but it's, you know, it's a lot cheaper. It's pennies or or less than a penny to submit a transaction, and that's better. But the problem is that you still have to get tokens before you can use the blockchain.
00:34:28 Luke Willis
And so changing that so you don't even have to have tokens, that's a much better design.
00:34:35 Luke Willis
And other other black chains are waking up to this. I think that there's going to be a lot more usage of this kind of system where people don't need to have their own gas tokens because apps are paying for the usage. So it's really a question of which economic model will be more successful, which chains going to capture the most.
00:34:56 Luke Willis
Users and and that sort of thing. So I I don't know, this isn't financial advice. I'm not suggesting anybody go and buy coin or anything, but for me I like the design and it's it's fun to to build on it and.
00:35:09 Dr Genevieve Hayes
With the gas cost, if I was to extract data from the Ethereum blockchain, would I have to pay gas fees?
00:35:17 Luke Willis
Good question. No. So if you're reading data from the blockchain and you're not, you know, deploying an app or writing data to the blockchain, then that's all free. You do need to have access to the blockchain, so you could run your own node and, you know, read all the data from the blockchain and then interact with your own node.
00:35:38 Luke Willis
But that takes time. It takes a while to sync up and and download the database from all the other participants. So for most people you find you know, a company that is already running a node that you can talk to and for simple things, especially like talking through an app, you don't need to pay that.
00:35:58 Luke Willis
Company to access their their.
00:36:00 Luke Willis
Nodes. But if you were building an app or a data dashboard or something, they may have some costs to integrate with their their data endpoint basically.
00:36:10 Dr Genevieve Hayes
And I'm sure there are services on the Internet where you can pay some monthly fee and you can download it away.
00:36:18 Luke Willis
Yeah, yeah. And it's all at that point. It's going to be usage based. So if you're talking to one of the big ones for Ethereum, it's called info.
00:36:27 Luke Willis
And so if you were using infra and you needed to download a couple gigabytes or you know the whole, you know, terabytes of data or whatever, there would be a cost based on how much you were using.
00:36:39 Dr Genevieve Hayes
But it's easier than setting up your own node.
00:36:42 Luke Willis
Yes, well, maybe easier. Yeah.
00:36:49 Dr Genevieve Hayes
So you've mentioned Daps and how you've built.
00:36:52 Dr Genevieve Hayes
Gaps. So a DAP is a application on the blockchain, I take it. Can you give us some examples of some of the Daps you've built?
00:37:02 Luke Willis
Yeah, good question.
00:37:03 Luke Willis
So the first DAP that I built was basically an NFT which is a non fungible token. So we've already talked about cryptocurrency and that's what's called a fungible token. So just to explain that briefly, a dollar is fungible. My $1.00, despite the fact that it's crumpled up and.
00:37:24 Luke Willis
Ripped a little.
00:37:24 Luke Willis
Bit is still worth $1.00 it's the same as somebody else's crisp new $1.00.
00:37:30 Luke Willis
Compare that to non fungible tokens. You can think of that as pieces of art or phones would be non fungible, right? Just because you know this one's mine, it has my information in it and it's a year old and it has a scratch right here and it's different from somebody else's, even though it's the same.
00:37:51 Luke Willis
So that's what you know the fungible non fungible side of it. And so NFT's get a bad rap as being just, you know, monkey pictures on the blockchain. Yeah, but the concept is really just a a non fungible piece of data that is transferable.
00:38:10 Luke Willis
Can be created, can be destroyed, but it can represent anything. So if you're building a game and you want to have your players trading cards or something like that be represented on the blockchain, those would be NFT's and they would be something that players could.
00:38:27 Luke Willis
Trade back and forth, either for money or for other cards, and that would all just be baked into the system of the blockchain, because accounts and trading and transfers and all these things are already well defined by the ecosystem. So it's not something that you have to build, you just say here's a new.
00:38:47 Luke Willis
NFT and it represents this and then.
00:38:51 Luke Willis
By default you get all of the other.
00:38:54 Luke Willis
Ecosystem things for free because it's all plug and play with all of the other applications that are on the blockchain. So that was my my first app. We can come back to to NFTS but yeah, I built an NFT and a a website that let you mint or create the NFTS and.
00:39:13 Luke Willis
Owned them and and all that stuff. The second one I built was an app called Burn Coin, which is basically a a staking pool where if you want to earn some profit on your token.
00:39:27 Luke Willis
You could run your own node on your your local your local computer or something in the cloud and you know earn profit for contributing to the network. But the pool allows you to just deposit your tokens and then share in the profits generated by the node that I'm running. So.
00:39:47 Dr Genevieve Hayes
I guess I mean it's just how regular finance works. I invest, I buy shares in a company and then they use my money to do useful stuff.
00:39:56 Luke Willis
Exactly. Yeah. And and that's that's a really good representation of it, because if you are.
00:40:01 Luke Willis
If you have money, you could go and actually hand it to your brother in law who's starting a company and and he's going to earn you some return on your money. But then, you know, maybe it's locked up for so many years and you may never see it come back.
00:40:17 Luke Willis
And and all that.
00:40:18 Luke Willis
Or you could deposit it in an account that is.
00:40:21 Luke Willis
Diversified and and pools everybody's resources together to earn a profit through real estate and investing in companies. And you know, doing whatever. And so a a pool is really that. It's a a place for multiple people to deposit.
00:40:37 Luke Willis
And benefit from the work of one node or one you know, venture behind the scenes which will just share the profits across all the depositors.
00:40:48 Dr Genevieve Hayes
Did you have to have a financial services licence to build that?
00:40:51 Luke Willis
I didn't because I'm not actually providing a financial service. I built the the code that lets you deposit and withdraw, and I'm running the.
00:41:01 Luke Willis
The node that is interacting with the blockchain, but I'm not actually doing anything with your money. The blockchain is doing its normal business and that's that's it. So I'm not going and taking your money out. I'm not actually taking control of your money. I can't pull your money out even if I wanted to.
00:41:21 Luke Willis
All I'm doing is running a a computer.
00:41:24 Luke Willis
And then the last one that I built is a a name service. So this is another NFT where if you wanted to get your name as like a a usable token that represents who you are, you could get Genevieve dot coin or any number of other names that you wanted.
00:41:44 Luke Willis
And it would. It's basically just a username on the blockchain, but it's something that's transferable and it's something that maybe holds value for other people. So if you've got a a specific name that was particularly rare or, you know, particularly short name or something, other people might want that and so.
00:42:01 Luke Willis
Well, the the tradability of that is not something that I'm, you know specifically playing on. I I'm not suggesting that the the value of these names is going to go up over time or something like that. But if you want to buy and sell them specific names, you can where?
00:42:21 Luke Willis
If you're on.
00:42:22 Luke Willis
Twitter and you get your name or somebody else already has your name. You have no way of getting it right. There's no marketplace where you could go get the name you want. So it's more like a domain name from that perspective because you can get your favourite and sell it, buy it whatever you want. So it's it's an open marketplace for for names.
00:42:43 Dr Genevieve Hayes
So it's a marketplace rather than the equivalent of a domain name server. Is that right? Or does it have the DNS built into it as?
00:42:50 Luke Willis
Well, the app that I built was the the name service, but because it's on blockchain it you benefit from the marketplace side of it.
00:42:58 Luke Willis
As well, OK.
00:43:00 Dr Genevieve Hayes
That's pretty cool.
00:43:01 Dr Genevieve Hayes
So after listening to this episode, I know I wanna go out and start playing with some of this blockchain data and I suspect some of our listeners may be inspired to give blockchain a go as well for people wanting to get started with either.
00:43:21 Dr Genevieve Hayes
Playing around with the blockchain data or with dapp development, where would be the best place to begin?
00:43:28 Luke Willis
So if you're interested in looking at Coin Nos, there's two websites that I would start with. One is quantosblocks.com, the other is coiner Dot app. Those are both block explorers, which is just a website that lets you go click around and look at blocks, transactions, accounts and all the activity that's happening.
00:43:50 Luke Willis
On the blockchain right now, if you want to go with some more established chains that have more data and more probably more interesting things to look at for now, Bitcoin, there's a number of block explorers there.
00:44:03 Luke Willis
You can just look up Bitcoin Block Explorer and any number of those would be fine. Ethereum, the big ones ether scan. But yeah, again, if you just want to type in the name of the blockchain and block Explorer then you can go look at all of the data there and that'll be free. You don't need to go pay for a.
00:44:23 Luke Willis
Server connection or anything like that to do that because it's already paid for by that app that's set up so the the benefit there is you get to go play around, right? You get to go see some data and start to understand what you're looking at and see.
00:44:37 Luke Willis
Blocks being created, transactions being included, and initially these things are very overwhelming. There's a lot of data and a lot of crypto hashes and and things going on that are above that standard expectation of looking at data, right? So.
00:44:57 Luke Willis
Start there, click around, ask questions. Anybody listening to this wants to go click around and see something that doesn't make sense, can certainly email me or DM me on Twitter. I'm always happy to help with explanations and write about it on my own newsletter and that kind of thing.
00:45:15 Luke Willis
Yeah, that that's a great way to get introduced to it. And then as you build up your understanding of the specific concepts and how blocks are structured and transaction data and that sort of thing, then you can go look at creating dashboards and and your own custom Daps and that sort.
00:45:31 Dr Genevieve Hayes
Of thing. So I'm guessing that a lot of this data is going to look a lot like.
00:45:35 Dr Genevieve Hayes
Financial data. So the sort of like the data you'd get if you downloaded Stock Exchange data.
00:45:42 Luke Willis
Probably quite a bit of it. It does depend on which blockchain you're on, where Bitcoin, a lot of it is just, you know, token transfers. That's that's really the the majority of transactions that happen on on Bitcoin, but there's a lot of other things that that are in that data that you wouldn't notice if you were downloading.
00:46:02 Luke Willis
You know, a spreadsheet of financial data, things like.
00:46:06 Luke Willis
Block IDs and hashes for the proof of work you know. So there's a lot of things that are happening with every block or for every transaction that you can think of as just really metadata that you could probably just ignore when you're trying to get at the meat of what's this person actually doing.
00:46:26 Luke Willis
But it's still something that you have to learn to weed through and and Recon.
00:46:29 Dr Genevieve Hayes
Nice. What final advice would you give to data scientists who are looking to create business value from data or from the blockchain?
00:46:38 Luke Willis
Yeah. Well, I think that the the thing to take away from blockchain even if you don't use it specifically is just the the model of decentralisation where when you're looking at data, traditionally it's owned by somebody, right? And it's private and there's different authorizations and rules and.
00:46:59 Luke Willis
And that sort of thing, and whether or not it's encrypted or hashed is not really a.
00:47:04 Luke Willis
A. A thing you care about, right? It's it's more just. What can I see? What can other people see who's authorised to access this and that kind of thing? So from a traditional data science perspective, you don't think about, you know, should I encrypt this or should this be hashed or and that sort of thing?
00:47:22 Luke Willis
Correct me if I'm wrong on that, but from from a from a blockchain perspective, everything's out in the open. All the data can be seen by anyone at any time. So.
00:47:34 Luke Willis
When you're when you're analysing data and what's actually happening on chain, there's a lot of things that actually get obfuscated and hidden by hashing it or by encrypting it, and so.
00:47:49 Luke Willis
What you get is you have to pay more attention to what does this actually represent? Is this token you know? Can I actually see what the data is, or is it going to be revealed at a future date by somebody off chain? Because if I'm submitting a hash onto the?
00:48:07 Luke Willis
Blockchain. No one actually knows what the data is, but I can cryptographically prove that I have the data by, you know, some future date. When I produce the data, I submit the the data and the hash of the data, and people can verify that it actually represents the thing that's been on chain for years. So.
00:48:27 Luke Willis
There's interesting use cases when it comes to blockchain and how data is hidden, how it's shared, how it's public and encrypted and all these.
00:48:36 Luke Willis
Things that kind of stretch your imagination in ways that you don't get with traditional private networks with authorization models.
00:48:45 Dr Genevieve Hayes
Though you could theoretically have people's banking passwords on the blockchain, as long as they were encrypted, I wouldn't encourage it. But you could have it.
00:48:53 Luke Willis
No, I wouldn't.
00:48:56 Luke Willis
You certainly could.
00:48:58 Luke Willis
Generally I try to be care.
00:49:00 Luke Willis
About putting just encrypted data, because if and when quantum algorithms crack, a lot of our encryption stuff, that data is still out there, and so yeah, generally speaking, it's OK to do like a one way hash of data to stick it on, because no one will be able to reverse that.
00:49:20 Luke Willis
But encrypting with like a two way algorithm that you can get yourself into future problems if you don't plan ahead.
00:49:26 Dr Genevieve Hayes
I'm interested to see what happens with all the encryption once quantum becomes a big thing.
00:49:32 Luke Willis
Yeah, it it's going to be a very interesting dilemma for a lot of blockchains and a lot.
00:49:37 Luke Willis
Of other applications.
00:49:38 Dr Genevieve Hayes
As well, yeah, the one I'm interested in seeing what happens with is things like self driving cars.
00:49:43 Dr Genevieve Hayes
Yeah. Yeah. So you could have all sorts of really bad things happening there.
00:49:48 Luke Willis
Absolutely. Well, fortunately, we already have some quantum resistant things going on in in the blockchain space and and off. So researchers are coming up with good solutions for these things. It's a question of when they should be adopted and in what ways.
00:50:04 Dr Genevieve Hayes
For listeners who want to learn more about you or get in contact, what can they do?
00:50:09 Luke Willis
Yeah. So if anybody listening to this, found it interesting and wants to know more about my work, the easiest way to find me is to go to lukewillis.com and I have links to all the different daps I've built there, my newsletter, my podcast, and yeah, basically everything. I'm doing, social networks and all that stuff.
00:50:30 Dr Genevieve Hayes
And I do encourage listeners to sign up to the newsletter and listen to the podcast because that was how I first started to learn about coin us and the blockchain. And that was what gave rise to this episode.
00:50:44 Dr Genevieve Hayes
Right.
00:50:44 Luke Willis
Appreciate it. Yeah, you've you've sent some very interesting questions back to some of my emails that have prompted further further writing. So if anybody has questions, you can always send them my way. I enjoy writing about and thinking about the different things that you're thinking.
00:51:01 Dr Genevieve Hayes
About. OK. Well, thank you for joining me today.
00:51:04 Luke Willis
Absolutely. This has been fun.
00:51:06 Dr Genevieve Hayes
And for those in the audience, thank you for listening. I'm doctor Genevieve Hayes, and this has been value driven data science brought to you by Genevieve Hayes Consulting.
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