 from the Hard Rock Hotel in Las Vegas. It's theCUBE, covering Hoshokon 2018. Brought to you by Hoshokon. Hello everyone, welcome to this special CUBE coverage we are here live in Las Vegas for Hoshokon. I'm John Furrier, the co-host of theCUBE, and this is part of our continuing coverage and our initiating coverage of the blockchain crypto world been doing it since January. Covering on our internal website, silkenangle.com, since 2011, covering Bitcoin and all blockchain stuff, but this is the first security conference dedicated around blockchain and crypto put on by Hoshokon. It's an industry conference and we are here covering it and this is an open small kernel of smart people really trying to have a top level conversation around security. And our next guest is Christopher Ford, he's the CTO of 3BX, welcome to theCUBE. Thanks for joining us. Thank you, pleasure being here. So before we get into some questions around security, what do you guys do? What's the company do? You guys have a unique approach. Take a minute to explain what you guys do. 3BX is essentially it's a marketplace. It's a digital asset marketplace. We're trying to build a community around trading digital assets. We're really trying to focus on pulling away from the term cryptocurrency because we think it'll expand into a much broader term. So we're structuring our platform on the support of any type of digital asset, whether it be a crypto kitty or whether it be an ebook, a concert ticket, something that has a digital form that can be traded person to person. So basically you're spanning the definition or actually depositioning crypto because it's kind of narrow relative to how you guys see it. It's pretty narrow. Digital assets, I mean look at gaming. Gaming culture is not new. I mean they trade stuff all over the place. Even in game tokens, they don't exist on a blockchain yet, they're not cryptographically secured. So those are the types of things that I expect to see hitting a lot of these marketplaces soon. Well that's smart. I mean I think if you look at it, I mean certainly we have run on blockchain. Our entire media company has been moving to blockchain and crypto and token economics, but really the blockchain piece has been very limited and it's like it's got very poor functionality and all the top blockchain implementations are either private blockchain, low latency and fast and developer friendly. So Ethereum's great for smart contracts but this doesn't scale relative to what most people need. If you're running, you need a million IOPS and you've got a marketplace. Some of these large scale, hyper scale networks, they're massive marketplaces. How do you guys fit in there? Do you guys, what problem are you trying to solve? Let me start with that. You know we're trying to pull away from the complexities of an exchange. We're trying to give kind of the community a good tool to trade without a lot of knowledge of tokenomics. One of our unique assets or unique features is that you can trade with no market impact, you don't have to worry about price slippage or the complexities behind order books. So we give kind of a familiar interface to trading, so something you see on a traditional e-commerce platform. So we're trying to kind of introduce it to a wider range of people. We've talked to a lot of people who have a lot of difficulties, especially with the decentralized exchanges. What are their problems? Just like reliability. Reliability, liquidity, I mean there's a lot of issues with liquidity around them which causes problems when you try to trade any significant amount of coin. So we're trying to give traders and the coin companies another outlet to trade without having to worry about liquidity, or the risks of liquidity associated with. So what's the status of the company? How many people you guys got? What's the size? Do you have any deployments? Are you guys engaging certain communities? We are live. We released a kind of invite only beta about two months ago. So we've been out there having traders for about two months. We're a very small team. We're based out of Las Vegas. There's a development team of three people. We're just now kind of broadening into more partnerships, more marketing. So you guys have been hardening the platform basically, been jamming and coding. We went kind of product first and then took a step back and are now approaching the market. So yeah, we're really excited. That's smart. You didn't hype it up first. But you could've definitely hyped it up I mean a lot of people who are winning right now are quality deals that had opportunities to do an ICO. Just people that are throwing money around. Just go back to February, the numbers are just off the charts. Kind of bubbled burst in February. Certainly the SEC announced today I'm covering the news. Major crackdown on all those ICOs on violations for the United States. It just causes a distraction. And I brought this up with hard charge last time I interviewed him in Toronto at the Futurist which is exactly kind of what you guys are doing. And this is a core trend and I want to get your thoughts on it. A lot of the alpha entrepreneurs are the ones that are building companies. Don't want to get distracted from stuff that's not optimized on building a company. For instance, if I do an ICO or you get involved in domicile issues outside the United States, you're optimizing all of your energy. They're on an airplane or market dynamics that aren't building a company. This is kind of almost a distinction at this point. You can almost look at opportunities, startups, entrepreneurs and ventures and say, okay, we can almost see who's doing what. You agree? Yeah, I think it's important to have something before you go and you spend a lot of energy raising money, building a pipe around a company. I think we're going to see a huge trend towards product first, having something, having a development team, a concept, a patent, whether it be not just based on a theoretical white paper. So it'll be very interesting to see how it goes. We decided to go product first. So no one had heard of us until we went live with our product. It's a good approach, I like it. I think it's solid, good. We'll see how it turns out. But I got to ask you, and I want to dig into the product a little later on this interview, but I want to ask you specifically around some core trends I'm seeing and patterns. It's pretty clear that when these emerging markets develop, total activity on the entrepreneurial side, a lot of people build and developing, attacking the market, but it's a trend. Everyone's throwing out a common thing. I need to have community and I need a two-sided marketplace. So the common trends, and if people don't have those, you can't just buy a community. Communities aren't bought. You can't just say, hey, I need a community. Put a telegram channel, write some bots, and next thing you know, I got 25,000 people on telegram. That's not a community. That is AI bots looking like a community. And then the two-sided marketplace, you got to have a value proposition. So these are things that people are putting into their plans that don't have answers for. What's your thoughts on that around community and about marketplace? What are you seeing in the market developing right now? I mean, building a strong community is very difficult. I mean, they have to align with your product. They have to align with your vision. They have to understand what you're doing and at least have a use case for it. So we're really trying to kind of have the community drive our development roadmap. So we've done a lot of outreach, trying to get what people are interested in, what's lacking in the industry currently, what they want to see, what they're unhappy with. And we're trying to build a community around allowing people to have input and influence into the product that we're building. So we find it, we're really early in the process, so it's difficult for me to really say that it's easier, difficult to build a community. So you're engaging the community. We are engaging the community. What are the number one things you guys are solving and problems that you see that are immediate low-hanging fruit that you're knocking out right away? What are the core things? I think some of the big ones are simplicity, the usability of these interfaces, kind of the knowledge around it, trying to do a knowledge transfer to our customer base and trying to help people realize that there's a company behind these coins. I think that's a huge, a huge thing that we have to kind of push towards is it's not just a token, it's a token produced by a company with a cause. So how does your product work? It's like a basic marketplace that you would see in kind of eBay or in Amazon where someone posts an offer, posts a listing, and other people can buy from it. So it's a buy and sell kind of- And you have your own native token? We have a native ERC-20 token that we use for fees. Because we're targeting the digital asset generally, we've externalized fees from traded goods. So we want to make sure that we can handle something that may not be divisible by Bitcoin is. So if you trade a book, for example, a lot of these exchanges would take a page out of it if you use the current model of fees where they're kind of coin-shaving off of your trades. So we're trying to eliminate that so we can expand into non-fungible or non-breakable assets. We're also developing a wallet that basically encapsulates cryptocurrency into smaller assets to be traded off-chain. So we plan on kind of revolving around our internal token to handle fees of those assets. There's a blend of on-off-chain dynamics. So you can do a lot of stuff and not have to do a lot of writing to the chain if you're going to be new. There's a lot of read-writes. All right, so the question I want to ask you that thing that's important in everyone's mind is, okay, Hoshokon is the first inaugural. We'd love to go on inaugural events because you don't know it could be the last one. Or it's going to be big. I think this is a big trend and one of the things we heard last night at dinner was, and we were having a conversation with, was there's no real conference. These conferences don't put security in the front. They really kind of have it as a side panel and it's always kind of an adjunct to something, you know, bigger pitch competition, big sponsor-driven kind of programs. This is a security conference. What is the impact in your opinion of this Hoshokon and security in the blockchain that's going to shape the industry? What is your opinion? What is your commentary on that? I mean, obviously it's important to focus on security. I think a lot of people had a lot of kind of assumptions that blockchain-specific or blockchain-based technologies were unhackable. You know, the decentralization of something makes it secure. And I think that's a myth that, you know, they're going to have to debug and we're seeing it with hacks. I mean, there's a lot of, I think, assumptions around even the hacks that are incorrect. So, you know, bringing the idea to people that, you know, blockchain still needs to be managed. You still need to be careful. The smart contracts still have, you know, vulnerabilities and risks involved. It's not... Software is software. Software is software. You know, it's unavoidable. When you start writing code, there's going to be... You don't want the blue screen of death. Certainly, you know, when you don't want to have to reboot. I mean, move fast and break stuff was great for web scale, but when you talk about security and currency, you need rock solid, 100% reliability. Otherwise you lose your cash or your e-money. Yeah, it's something of value that you're going to lose. It's not a social media account. It's not, you know, something like that. It's, you know, you're losing money. And it's very interesting. I think the more people know about this security behind blockchain cryptocurrency, the more they're going to realize that it's not a, you know, an end-all solution to everything. It's going to, you know, it takes time to evolve. Standards will probably have to be put in place, you know. I mean, there's a lot of people I remember when I was, you know, your age and the web was coming around. Everyone was afraid to put their credit card down on basic e-commerce transactions. And that was natural because like, oh my God, it's online, it's almost felt like a black box. And then they got over that pretty quickly. You saw PayPal and those companies came out. You can still mention eBay. These online sites are now secure. Crypto is almost like an unknown lack of education in the mainstream. And so we got to get to that point where, you know, wallets are wallets and they actually do a good job and you don't forget to leave your wallet at the restaurant kind of thing. You know, like, there's some hygiene and practices that are needed. I mean, maybe older generations maybe might not get it. But the younger generations, they're getting it, right? I mean, what's your opinion of this? Because this is a generational shift. I mean, this crypto blockchain market, it's really generational. Anyone under the age of 30 pretty much loves it. So it's happening, right? So what is the views around security generally in the mainstream? I mean, I don't think there are too many. Like I said, I think people kind of put a lot of assumptions in the security, the inherent security of blockchain stuff. And I think they don't realize that, you know, we're trying to make it easier through mnemonic sequences or passwords. So we're hosting wallets online now. It's not necessarily a pure wallet in the sense that it sits on a piece of paper. So we're going towards usability, which we're sacrificing security for. So the more usability we get with a lot of these kind of mainstream products, the more we're going to have to realize that we're getting back to a place of, you know, existing security vulnerabilities with passwords or, you know, stuff you would see with your bank account. So it'll be interesting to see the balance between, you know, the raw security kind of inherent with like Bitcoin or, you know, a traditional cryptographic wallet and then usability, whether it be cloud-based stuff or these exchanges. You know, Chris, one of the things that you're doing, I think it's interesting and it kind of points to the, if you connect the dots, the trend of granularity, really levels of granularity getting down to the micro level. It's microeconomics. This beautiful thing about this market is that you can take a page out of a book, you can track it and how you use that page. You can pay for all kinds of digital rights stuff, digital assets, if you look at just the world as a digital asset, this brings up the question of, okay, this is now, there's going to be software that's going to be written to manage this level of micro transactions or micro assets. So how do you view, in your opinion, this whole notion of token economics because we've used tokens for years on all the stuff we program, authentication, you know, all tokens are used in computer science, not a new concept. But if you think about tokens as a currency and as a mechanism for computer science, software, do you see a multi-token world? I mean, why wouldn't everyone have their own token? And then there's going to be software to manage the tokens. If you have a token and I have a token called the Kubecoin and you have your token, there's probably going to have to be some interaction between coins. Do you see that day happening sooner than later or do you even see it happening? You know, it's going to really depend on the use cases that they find, whether a single platform is going to come out and kind of take over the standardization of managing it. Or, you know, who knows? I mean, you see some of these transactional bridges like between Dogecoin or Ethereum. So you can see that happening between tokens or everything being built on the same chain or having these bridges between chains, whether it be like an EOS to Ethereum token chain bridge. I don't know, I mean, we really have no idea. Multi-chain is interesting, right? I mean, this is an interesting conversation. My vision is I think multi-chain is a good trend. Why wouldn't you want to have multiple chains if the use cases are not overlapping? I mean, I just don't feel comfortable with a monolithic approach of tokens. I just kind of am uncomfortable with that. I mean, I think it would be important and like you said, it would be very important to have a good solution to manage them. I mean, people aren't going to want 100 programs on their computer to manage their tokens. They're not going to want, you know, multiple apps on their phone. There's going to have to be some standardization so that people can manage it easily. Otherwise, it's going to be impossible to keep up with and that kind of the interchangeability between tokens will be important. Chris, final question for you. What's this event like here? Describe for the folks who aren't here, what's the vibe, who are the people? What are some of the conversations in the hallway so far? What kind of person is here? What is this event about? What's the relevance of Hoseokan? Well, it seems like it's a lot of, you know, technically-minded people kind of hoping to push forward the security in the blockchain world. We've had conversations about everything from educating the masses, so, you know, kind of the average person who doesn't maybe understand the complexities of Bitcoin. You know, how do you inform them of what we're doing all the way up to, you know, what's the next step in security auditing? And that's, you know, Hoseok is really pushing forward. How do you audit your code on the blockchain? We're on a lot of these platforms and I think it's really important to have these conversations because it's opening up new worlds of, you know, new thought habits for each of these companies. I mean, everyone has their expertise. You know, Hoseok specializes in smart contract auditing and, you know, we may not have the, you know, that in-depth of knowledge of how to audit the contract so, you know, it's nice to kind of share the knowledge and see that there's other solutions out there than everyone doing it on their own. What do you hope to be known for for your company? If you could have that vision down the road three years from now, what do you want to be known for? I mean, I think it would be best if we were kind of known as a platform to bring newcomers into the space, you know, informing, caring about the community, making sure that they understand what they're doing before they do it. You know, as you know, Bitcoin is, it's very unforgiving. A lot of these cryptos are very unforgiving so it's, I think it's very important for us to kind of get to be known as someone who helps bridge that, that kind of intimidation. All right, Chris Ford, for three BX CTO entrepreneur building a company, doing it the right way. Plants to use tokens, and you guys, did you raise any money? Did you? Not yet? No raised money, we're privately funded. Nice. So we're going that route. Good, bootstrapping, making it, getting it done. Taking a different approach, which is, which is the classic approach of building a company, the right way. That's theCUBE. We are here in Las Vegas for Hoshokan. I'm John Furrier. Stay with us for more coverage after this short break.