A Stanford graduate and former associate partner at Monitor Deloitte, Steven Pu is a serial entrepreneur in healthcare, IoT, and blockchain. Fascinated by the promise of decentralized networks for making transactions between people, companies, and machines, fully trusted and accountable, he quit his day job to solve the failures of centralized organizations. We asked Steven a few questions about his decentralized project Taraxa and this is what he had to say:
Q: Let us start by getting to know more about Taraxa. Can you please explain the project to our readers?
A: Sure! Taraxa is a public PoS blockchain ledger built specifically for audit logging of informal transactions. It means that all the technical choices we made in the network design (block DAG, concurrent execution, rapid finality) are dedicated to making it highly scalable and fast. Not only that but also two fully- fully-featured prototype dApps – Marinate and Helio – on top of the Taraxa network that were validated with our partners from different industry verticals.
Q: Tell us about how you guys started.
A: Taraxa started in early 2018 with seed investment from angels in Japan and Singapore. An early research-oriented team was formed in the first half of 2018 composed of academics associated with our advisor Professor Herlihy to help define the proper technical direction for the project. A private round was conducted during mid-2018 and a core technical team was put together in Mountain View, California at the end of 2018, coding began in December of 2018.
Q: What got you into blockchain in the first place?
A: I had a rather unorthodox career of launching startups and working in strategy consulting advising large companies. What I found out was that what was impeding innovation was fundamentally a problem of coordination – as projects become more complex, more stakeholders involved, organizations grow larger and everything exponentially slows down. This is why large companies get outpaced by startups. Not b/c they’re stupid or lack resources, but because they’re too slow.
If you think of it more broadly, we, as a human race, do not scale very well. I built Taraxa so that we as a human race can coordinate faster and scale up faster. A ton of these problems of coordination were caused because you need time to validate, filter, build relationships around people because you need to trust the information being passed around, and more than ever that information was being generated faster & faster, all of it hard to capture, unstructured, and informal, whether they’re generated by people or machines. So blockchain is an interesting tech b/c its signatures + immutability holds entities committing information accountable – you said it, you need to be responsible for it. Blockchain obviously can’t know if something is true, but the accountability drastically reduces the incentive to lie, and this is what’s so exciting about it.
Q: If I understand it right, Taraxa aims to migrate a lot of off-chain and even offline data to the blockchain. How do you manage it?
A: Right. The problem with the majority of off-chain data is that it remains unstructured and can’t be verified, while holding lots of potential value for business. The bigger problem though is that even blockchain can’t guarantee the veracity of off-chain data. We solve this in two-step: first capturing the data at the source to guarantee its provenance. For human-to-human data, it means that we go right where informal communication takes place – messengers, in-app chats, and even SMS. For machine-to-human IoT-focused use cases, it means collecting data from cryptographically-secured sensors that we also custom-built. Step two is anchoring hashes and signatures of that data onto the Taraxa blockchain to guarantee immutability. The combination of provenance and immutability gives you a perfect record of “who said what when,” helping to minimize potential confusion & disputes by enforcing accountability.
Q: How easy will it be to use Taraxa’s solutions in the current business setting? Do you expect any resistance to adoption from the employees of businesses that are interested in your product?
A: Legacy systems are hard to displace, but we hope to overcome this by offering something that hasn’t really existed before. We’re actually targeting the data that has never been available before – that 80% of business transactions that remain scattered around intranet chats, collaboration apps, and SMS threads. The funny part is that all the existing ERP suits just keep ignoring this critical mass of operational data that holds enormous value for operations of all scale – be it an SMB that’s only growing their customer base, or a solid international business with thousands of clients and vendors. So Taraxa’s major value prop is capturing this unstructured data right where it resides, and our go-to-market is also bottom-up, or the Slack type, if you will, which means that we’re focusing on the end-user and give access to our solutions to the consumer first.
Q: Your website shows multiple products. What are Marinate and Helio?
A: Right, we currently have two running in demo, already piloted with some of our clients. What Marinate does is it helps to track informal everyday agreements. Currently, for transactional agreements, there’s a tough tradeoff between clarity and speed. Contractual agreements give you clarity, trust, and verifiability, but are very slow and expensive. While informal agreements constitute the lion’s share (more than 80% actually!) of ALL world’s agreements, mostly happening via text, in-app chat, or email are convenient but unclear, often leading to disputes that cost hundreds of billions every year to resolve. So Marinate breaks this tradeoff through simple integrations and blockchain-enabled audit logs, giving users both convenience and clarity, helping them to minimize the risk and cost of disputes.
HELIO is a hardware solution for IoT asset monitoring, platform providers & operators that secures machine state integrity. What is does is basically establishing auditable digital identities for connected devices. Let me share an example from our recent client work with an automotive OEM company. They have been dealing with the problem of tracking and sharing vehicle history data for their new mobility and MaaS initiative. So we offered them a cost-effective bundle of blockchain software and cryptographically-secured hardware modules that were installed on each vehicle’s odometer and accelerometer. Vehicles are now identified through cryptographic keys that ensure secure communications and data sharing. A secure boot ensures that only an entity with the right private key is able to load applications into the microcontroller. Every module has onboard key generation and signature functions to maintain hardware independence, while the application logic to the MCU that completes the disable write access permission in advance to ensure anti-tampering behavior.
Q: Can you give us some examples where these solutions come in handy?
A: There are so many, really! Think of all those situations when you need to explicitly agree on facts and events, but don’t have a tool at hand to do so – either because your client or friend doesn’t use this app, or simply because you’re on-the-go, or working on-site and can’t pull up your laptop right there, right then. Construction sites, remote work, supply chain and inventory management. At the same time, the world is pressing us to do things better and faster, and now with the whole COVID situation when we’re obliged to use a myriad of apps that only complicate the matter! So our applications really help to have that certainty and trust when dealing with complex coordination – whether it is when tracking the project milestones in hybrid work settings and change orders on construction sites, or securing vehicle-generated data for MaaS.
Remote work is a good example here. Marinate captures yes and no’s on the project milestones and records all the sign-offs to let team members coordinate approvals faster and be able to go back and check stakeholders’ response, no matter how they documented their work, or what collaboration suit their team or clients use. Or, take construction sites. Abound in confusion and delays, those are a constant source of stress and money loss for subcontractors. Marinate won’t require them to install yet another bulky construction software and capture change orders (up to $24B in dispute resolution cost annually!), or other reporting items from any baseline communication tool they’re using – email, text, and even a phone call.
Q: How do the IoT machines fit into what you are trying to achieve?
A: If we look at Helio’s use cases, our bundled hardware plus software solution, we’ll see that, along with cryptographically-secured sensors that we also built ourselves from scratch, it uses blockchain to process the data collected from connected devices (auto vehicles, AVs, and more) to ensure data source and immutability. With a secure IoT endpoint integrated into a blockchain-enabled audit logging, the vehicle itself is able to make highly trustworthy commitments about its mileage, location, and collision history, i.e. vehicle history data becomes 100% trusted and transparent enabling car owners to finally get rid of the unreliable and expensive middleman services. The only access control performed here (and probably the most secure one!) is whether or not an IoT transaction was signed by the correct private key — whoever has access to the private key is the device owner. This is also useful for securing IoT device identities and can be used in peer-to-peer mobility as a service – and this is one of our major arrays of work right now together with one of the largest automotive OEMs in the world.
Q: Here is a question that is rarely asked in the crypto space. What is the monetization model for Taraxa?
A: Haha, that’s rare, indeed! We got this sorted. Our application platform acquires value through a traditional SaaS model but transfers that value into the native digital asset through token purchases on the open market.
Q: How does one become a community member or a stakeholder in Taraxa?
A: We now have multiple community campaigns running pretty much every week, and the easiest way to onboard is to keep an eye on our Telegram, Discord, and Twitter, of course. For those, who’d like to run a node, or become a node validator, please reach out to me at [email protected].
Q: What can we expect in the near future? Are you considering any partnership with other projects or businesses?
A: We already have some major partnerships secured with clients in China, Japan, and the US. Our first notable collaborative research was done back in 2018 with the Japanese Ministry of Economics, Technology, and Industry to publish a book “Next Blockchain”, co-authored with vice-minister Yano Makoto.
We recently signed a collaboration contract with the largest automaker in Japan to leverage audit logging of automotive data on Taraxa for shared rides and second-hand car sales. We’re also deploying Helio to help an arcade asset leasing company track arcade machine revenues, and have a contract signed with a Chinese supply chain quality control operator.
We’re also looking to collaborate with Chainlink on a time-stamp oracle that can be very useful for both our applications, that’s still work-in-progress, but we’re very positive on the outcome. We’ve been actively building up our community outreach to onboard node validators, operators, and users, and plan to start distributing our token very soon – so be on the lookout for a major announcement in the coming weeks!