Since stumbling into the blockchain space in June 2017, I havewitnessed myriads of industrial cycles, the prevalent price surge, blockades ofexchanges in September 4, 2017, the unexpected bull market at the end of 2017,and the protracted bear market through the year.

The boom of altcoins, the explosion of ICOs, the rivalry amongthe public blockchains, the frantic forks of Bitcoin, and the subsequent burstof hypes and bubbles are all brutal expressions of the blockchain space.

Just a year and a half has gone by, but it seems we have livedmany years in a blink. As the saying goes: one day in the blockchain space, oneyear in the world.

During the days, I have been preoccupied with one question: what is the nature of blockchain?

What is the first and foremost thing to do when you study thenature?

As for me, I am convinced that we should gather and analyze thebasic and objective facts in regards to the very thing as best as possible,including its history and the status quo.


A Short History of Blockchain

It is universally known that the word “blockchain”originates from Bitcoin. It was invented by the anonymous Satoshi Nakamoto whopublished the Bitcoin whitepaper in P2P FOUNDATION in 2008. The whitepaper isshort enough, but it does not mention the concept of blockchain at all.

It is well acknowledged that Satoshi has become the cult ofpersonality in the years after the whitepaper thanks to his brilliance.However, the world is blind to the truth that one organization and a multitudeof computer geniuses have laid the foundation for the creation of Bitcoin formore than two decades.

Anyone who gets a smattering of Bitcoin is aware of the threepredominant technologies that lies in the infrastructure of Bitcoin: asymmetric encryption,peer-to-peer system and Hashcash. However, none of the threetechnologies is accredited to Satoshi.

Asymmetric Encryption:

Whitfield Diffie and Marty Hellman invented the asymmetricencryption algorithm in 1976. The following year, Ron Rivest, Adi Shamir, andLeonard Adelman pioneered the first commercially available asymmetric RSAencryption algorithms that established modern asymmetric encryption. Thefoundation of the theory has been widely used in the field of networkcommunication, and it has created the first major premise for the futurecreation of Bitcoin.

But, it is interesting enough that these encryption technologieswere closely supervised by the National Security Agency (NSA), which the NSAinitially deemed as a threat to national security and regarded it as a militarytechnology. It was not until the end of the 1990s that the NSA broke thebarrier of these technologies, rendering asymmetric cryptography muchpopularity in the public life.

By the way, as early as 1990, David Chaum created a private anduntrackable payment system, which was later dubbed as e-currency. But thecurrency was not decentralized, and it was not self-consistent. In 1998,Chinese American Crypherpunk member Dai Wei (As a tribute to predecessors, thesmallest unit of Ethereum is Wei), proposed an anonymous, distributedelectronic cryptocurrency system: B-monney. It was the spiritual mentor of thelater Bitcoin, but due to its limitations and design flaws at that time, it wasa lost cause. In 2005, Nick Szabo finally put forward the idea of Bitkin whereusers can solve the math problem and use the encryption algorithm to verify thepublished ledgers to construct a property certification system. It is veryclose to the idea of Bitcoin. Szabo also published a lot academic papers on therealization of the law in the network security. He can be described as thepioneer of the blockchain smart contract. However, … it was quite costly tosolve the math problem. What’s worse, Szabo was not capable of programming sothere was no programmers who believed him and were willing to cooperate.Consequently, Bitkin was stuck in the theoretical stage.

From Ecash, B-monney to Bitkin theory, generations ofCypherpunks are eager for free currency with all kinds of experiments and efforts,but they ultimately failed…

Peer-to-Peer Technology and Hashcash Technology

Despite the fact that the pioneers failed one after another onthe road to free currency, the technology itself had been constantly evolving.Later, Shawn Parker finally invented peer-to-peer network technology. Theaforementioned asymmetric encryption technology made it possible to createBitcoin. The last remaining question was the “double spending”. To put itsimply, it concerns the ledger-keeping right to be accepted by the system.

In 1997, Adam Back created the Hashcash algorithm. In 2004, HalFinney improved the “reusable work verification” algorithm based onHashcash. At this point, the perfect solution to the “doublespending” and “Byzantine Generals problems” has laid a solidfoundation for Bitcoin’s POW consensus algorithm. Everything was ready.

The prerequisites to invent Bitcoin, apart from the integrationof the three basic theories, are as follows: first, deep understanding of thecurrency; second, proficient programming skills; third, remarkable eloquence todrive the initial community development. The chosen one did not appear until2008. His name is SatoshiNakamoto.

In fact, Satoshi Nakamoto, together with the above predecessors,comes from the same mysterious organization: Cypherpunks.

In 1993, Eric Hughes and a few others created a”Cypherpunks mailing list” encrypted email system, referred to as”Cypherpunks”. The goal was to fight against Internet emails thatwere monitored by the government. Eric Hughes advocated its mission and goalsof Cypherpunks in A Cypherpunk’s Manifesto: “Privacy is necessary for anopen society in the electronic age.We the Cypherpunks are dedicated to buildinganonymous systems. We are defending our privacy with cryptography, withanonymous mail forwarding systems, with digital signatures, and with electronicmoney…We cannot expect governments, corporations, or other large, facelessorganizations to grant us privacy out of their beneficence.”

Yes, you are not mistaken. It began in 1993, the last century.Cypherpunks were very active, including hackers, cryptographers, and fanaticswho pursued privacy and property security. Most of the technical theories thatBitcoin relies on, and the inventors of these theories, all come from thisorganization. Some of the Internet typoons that are familiar to everyone arealso members of this organization, such as Julian Assange (founder ofWikipedia) , Sean Parker (Founder of Facebook), Bram Cohen (Founder of BTdownload) ,Tim Berners-Lee (inventor of the World Wide Web) and many others.

You may be surprised to realize that we have been focusing onBitcoin and Cypherpunks for a long time, but we hardly mention blockchain.Aren’t we going to talk about the history of blockchain development?

The truth is that the concept of blockchain emerges quite late,however, all of the technologies are the premise that the blockchain conceptcan originate from. It can even be concluded that they are the genes of theblockchain. If we only squabble blockchain without grasping the history , it isdifficult to understand the spiritual nature of the blockchain.

Due to the length, I will not elaborate the technical terms thathave been mentioned. If you are interested, please refer to “BlockchainScience” at the bottom of the article. I believe even if you don’t understandtechnology, you can still know the blockchain and its core technicalprinciples.

So when was the concept of “blockchain” proposed and whoproposed? I checked some information and it seems there is no authoritativestatement. As I dive into the sources, it can be clearly seen that the conceptof the blockchain is gradually spread around 2013. Previously, there were onlycryptocurrency, free currency, electronic money, Bitcoin and altcoin.

I don’t have a clue whether it is a coincidence that theprevious cryptocurrency climax occurred in 2013, and at that time thecryptocurrency industry began to develop in China.

In 2013, a large number of current industry tycoons came to thefore in China. Many of them have written articles of evangelism. They mainlyintroduced Bitcoin at the beginning, and later promoted the idea of“decentralization” and finally spread the concept of “blockchain”.

Around 2014, Ethereum stood out in the world. With the gradualpopularity of smart contracts, many people started to release tokens based onEthereum. At this time, blockchains are frequently mentioned while Bitcoin andcryptocurrencies are losing their luster. It is especially the case in China asthere are almost no voices on cryptocurrency in 2017 bull market.

Everyone is talking about the blockchain. Everyone is talkingabout the transformation that the blockchain will lead to the traditionalindustry. Everyone is talking about decentralization. Everyone is talking aboutthe store of value. Everyone is talking about the revolution of productionrelations.

Nevertheless, after experiencing the ups-and-downs in 2018, wehave nothing left but bubbles now. Can we find a large-scale project based onblockchain that has practical business model in the bubbles of trillions? Itseems there is no one left.

Therefore, it set me to revisit the question: what is the natureof blockchain? Is it the same reason like the 2000 Internet bubble and the VRgame five years ago where hardware and the market can’t keep up with thecapitals. Or is it like the video game that went wrong in the past few yearsand ran on the road of fake demands?

Status Quo of Blockchains

When we have done the research on the history of blockchain,let’s take another look at the status quo of the blockchains. In this section,I will try to only state facts not opinions. I will leave my opinions to thelast section after the history and facts.


No matter how much blockchain is intertwined with money,finance, game and social attributes, they all rely on the Internet andencryption technology. As a professional with ten years of experiences, I mayhave deeper understanding of the blockchain than the average.

Technically, the security of the blockchain is based on threebackbones:

First, asymmetric encryption technology ensures the securityduring communication.

Second, it only allows insertion and query and do not allowmodification and deletion of data storage which tackles data security,transparency and traceability.

Third, peer-to-peer technology and consensus mechanism can solvethe data consistency under the distributed architecture, and data consistencyis one of the basic requirements of any Internet application.

Whether you understand the technology or not, you should be ableto see from the literal description that these three core technologies arecentered on “safety”. It corresponds to the security requirements ofdata privacy, data integrity and data consistency. At the same time, under thedistributed architecture of peer-to-peer, it can naturally avoid thecatastrophic damage of data.

Are these three technologies amazing? Asymmetric encryption andconsensus mechanisms are indeed magical, however asymmetric encryption is notintended for blockchain. The earliest application lies in the US militarycommunication encryption technology, which was created for informationconfidentiality. It was introduced into the blockchain after the militaryreleased. Only the consensus mechanism can be said to be specifically for theblockchain, but in fact it only solves a traditional problem of distributedcredibility with Internet characteristics. The West calls it the”Byzantine General Problem.”

The addition, deletion and change of peer-to-peer technology anddata are also the basic technologies of the Internet. Peer-to-peer is widelyused in the field of efficient big data transmission, and the addition,deletion and modification of data are more widely used in almost all large andmedium-sized Internet products.

In order to achieve high security, the blockchain has done a lotof extreme design compared to traditional Internet applications.

First, the “server” of the blockchain is a thorough,multi-node, centerless distributed architecture. The distributed architectureis nothing new. Nowadays, large-scale Internet applications are almost alldistributed architectures, which are used to solve data backup, optimizeresponse speed, and improve TPS. However, in these distributed architectures,there will be almost one or even more levels of central servers, which we callthe “Client-Server Model ” architecture. The functions of the mainserver are different. They are generally used for user portal, scheduling,resource allocation, core request response, etc. If the main server is hung up,it will be serious. At least some important functions cannot be used normally.The client standby server will be enabled immediately, but it will still hangfor a short period of time. The current hardware technology can almost achievethe level without user perception. However, some small companies have limitedfinancial resources at the beginning, and it is difficult to afford such highhardware costs. Once the main server has problems, it will often be shut downfor maintenance and even catastrophic accidents.

So why do not the traditional Internet applications use a fullydistributed architecture like blockchain? The reason is simple. When there is acentral server architecture, the efficiency is much higher than the fullydistributed architecture, and it is easy to control and adjust.

Under the central server architecture, the response speed of aregular request can almost be considered as the bottleneck of the TCP/IPprotocol of the underlying Internet transport protocol, which is about 200 milliseconds.Although the whole process is very complicated, it requires multiple encodingand decoding, multiple protocol communication, and network node jumps, but allof them are linear. The response is in milliseconds or even microseconds.Everything is in agreement with the interaction of one center with another.

So what about the blockchain? In order to avoid the centralarchitecture being completely manipulated by political, military or financialforces, the blockchain uses a completely distributed architecture, which is dueto the maturity of peer-to-peer transmission technology. But who is theultimate non-central distributed architecture? So Bitcoin invented the POWconsensus mechanism to solve this problem. But there are two new problemsensuing:

1、Without acenter, it means that there are no centralized parties and stakeholders. It isreasonable to leave the parties aside because the blockchain is extremelysecure, and theoretically it does not need responsible parties. However, itincurs another fatal problem, that is, there is no centralized stakeholders,which means no one is truly interested. Strong interest binding, which meansthat no one can really care about it and willing to contribute financialresources. It is absolutely impossible to rely solely on faith, so Satoshiadded a reward mechanism to the consensus mechanism.

2、As thereis no center, even with the consensus mechanism and reward mechanism that fitthe logic, the execution efficiency is greatly decreased. Information needs tobe confirmed by many parties. At the same time, the blockchain cannot be toofast, otherwise it will cause data explosion. As data cannot be deleted,expanding too fast can cause catastrophic consequences. In addition, when ablock produces too fast, the attack will be very rapid, and the pseudo-chaincan quickly grow into the mainchain and cause double spending which jeopardizessecurity.

Therefore, we can see that under the absolute distributedarchitecture design, although security can be guaranteed and the participationof reward mechanism is also established from the sociological perspective, itis at the expense of “efficiency”, and this sacrifice is a lastresort instead of subjectively considering that efficiency is not important!

In the blockchain design concerning efficiency, the P2Pmechanism has almost no optimization. This is the basis of a fully distributedarchitecture; data is not allowed to be deleted and modified, and there isalmost no optimization. If there is no center, it cannot be deleted. Inaddition, the data structure of each block of Bitcoin is almost the mostsimplified design, and can not significantly reduce the amount of data;finally, based on the consensus mechanism of distributed architecture and thespeed of the block, it looks like there can be more optimization. As a result,various altcoins and chains after Bitcoin are mainly exploring in thisdirection, and the concepts are fantastic. However, from a purely technicalpoint of view, the dazzling consensus mechanisms are all indeed trade-offsbetween efficiency, security, and decentralization. There is no creativeinvention like the Bitcoin POW mechanism.

To our regret, there is always a contradiction betweenefficiency, security and decentralization. No matter how we optimize thedecentralized distributed architecture, it is impossible to catch up with thecentralized server architecture at the efficiency level. The difference isquite enormous, which is determined by the discrepancy in the technicalarchitecture itself instead of the temporary problems caused by hardwarefailure and imperfect public chain. Unless the public chain completely changesthe technical architecture and makes a multi-center distributed architecture.But in this case, compared with the traditional multi-level serverarchitecture, what is the essential difference other than the financialattributes under the reward mechanism?

Do you still remember why Bitcoin was designed to be acompletely non-central distributed architecture? Isn’t it just to shun problemscaused by the government, the military, and the financial groups controllingthe center? To this end, Satoshi has designed a distributed consensus mechanismat the expense of efficiency. Now, in order to improve efficiency, thenewcomers have gradually begun to return to the centralized technologyarchitecture. Is this sarcastic, or is Satoshi’s original idea completely wrongfrom the beginning?

On the way forward, when it comes to bottlenecks, should wechange our idea? This is a question worth considering.

First, Cyperpunks set out to create a decentralizedcryptocurrency, and they have not yet reached the real technical bottleneck.

Second, the bottleneck is mainly from the successors who hopesto derive a “blockchain” concept based on Satoshi’s design, anddesires to generalize this concept to various fields and realize thedecentralization of more fields. Successors believe that the blockchain shouldbecome an infrastructure like the Internet, and then implement a variety ofblockchain + and + blockchains, and realize the dream of overtaking in thistide.

In business , if the road ahead encounters ups-and-downs,sometimes it is really necessary to adjust the direction because business isessentially about making profits by serving customers. If customers do not pay,then we can only change direction.

But is bitcoin and blockchain a purely commercial one? Theblockchains of the successors seem to be more business-oriented. The efficiencyof the blockchain is not up to commercial requirements. We should abandondecentralization, improve efficiency, and meet customer needs, which is in linewith business logic. But remember the history of Bitcoin? Remember the missionof Cyperpunks? Remember the intention of Satoshi Nakamoto? Are theybusinessmen? Are they business organization? Is their intention to servecustomers and make money? The answer seems to be negative.

At this moment, we should reflect again: what is the originalintention of the blockchain design? What is the nature of the blockchain? Inthe big bull market in 2017, after thousands of projects in the trillions ofbubbles, there was not one single large-scale landing project. Is this adistortion of human nature? Or is it the wrong way out?

Nature of Blockchain
Before I finally discuss the nature of the blockchain, I wouldlike to list the important objective facts mentioned above:

1、Almostall of the core technologies of Bitcoin are mainly from the Cyperpunk.

2、Themission of Cyperpunk is to advocate freedom, believe in technology, protectprivacy security of private property.

3、BeforeBitcoin, there had many similar but failed projects dedicated to the creationof cryptocurrency.

4、Bitcoincomes first, and then there is a “blockchain”. Satoshi did notmentioned the blockchain in the Bitcoin white paper. The “blockchain”is based on the “bitcoin” from future generations. The concepts hasbeen refining and evolving, especially in the 2013 bull market, and after theEthereum came out.

5、From thetechnical architecture design, the distrust of the center abandoned thecentralized server. Under the universal distribution of the framework, throughthe cryptography, peer-to-peer and consensus mechanisms and other technicalrequirements to ensure security and feasibility, we have to sacrifice theefficiency and the advantages of many other centralized servers.

6、In 2017bull market, after the trillions of bubbles, various projects with the conceptof “blockchain” and “decentralization” have failed in business which neithermeet the market demand nor produce normal business profits.

After a series of facts and arguments, I believe it is necessaryto abstract two core contradictions that need to be discussed:

1、performance or decentralization?

2、token or chain?

The first question is not difficult as I have solid technicalbackground, but I confess that it is difficult to understand technology withtechnical background. I have been trying to explain the principles oftechnology, even if you can understand its logic. If you choose not to believeit, then you can doubt the facts behind my logic. These facts, without atechnical background, cannot be verified, which is why the “millionTPS” is a red-herring but received more popularity in the space.

But even so, it is necessary to explore the nature of theblockchain and tackle the barriers. The blockchain itself a technologicalbreakthrough.

First of all, most of the Cyberpunks are technical geniuses.After 20 years of failure and hard work, the last master, Satoshi Nakamotocreated Bitcoin, and it is still an open source project. Countless talents canview the source code and directly modify it. In this case, if you insist thatperformance of Bitcoin is due to their lack in technology, then I am reallyspeechless. Maybe only those who don’t understand technology are so fearless.Anyway, as a professional, I am not buying a single word of it.

In addition, although I am not capable of inventing theblockchain, I still have confidence in understanding the technology. I havebeen working hard to tell you the truth: sacrificing performance is the lastresort to achieve distributed architecture. Perhaps everyone feels thatsacrificing performance is a silly solution, but from my perspective, it isgenuine creation where it can be realized by sacrificing performance in exchangefor security and feasibility.

If we assume that under the current technical conditions, toachieve decentralization, we must sacrifice performance significantly, so whatconclusions can we draw now? In fact, I believe that there should be a lot ofpeople who know a little about technology, and they are not willing to stare itin the face because the conclusion may be very pessimistic, and the imaginationof the blockchain may be greatly harnessed.

Without the support of performance, many large-scale commercialapplications can’t run in reality. The TPS of Bitcoin is less than ten, and theEthereum is dozens. As for the public chain such as EOS with thousands of TPS,the security has not been verified yet. What can dozens of TPS do? Nothing atall. Can you play a cat game? No, a cat can block the Ethereum.

So what is the value of Ethereum? The answer is issuing tokens.The Cyberpunks fought hard for so long before they invented a reliable Bitcoin.Now it is so powerful that everyone can issue a decentralized cryptocurrencylike Bitcoin, which directly advances the process and height of the 2017bubble.

In fact, everything is for the users and the market in business.What the market wants us, as long as we don’t break the law, we should changeaccordingly. In fact, since 2017, as many traditional businessmen haveparticipated in the blockchain space, the blockchain and even thecryptocurrency field have gradually transformed into commercialization. Thecore logic of this trend is: we can’t create reliable applications because theperformance is not superior, then we will solve this problem, and always meetthe needs of users. However, this group of businessmen who don’t understandtechnology and like to boast “A technical problem is not a problem at all”every day, had been working for a long time, and finally found out that in thecutting-edge innovation, a technical problem is really a serious issue. It isnot so easy to solve.

What should we do? From my personal observations, there arethree categories:

1、Those whoare obsessed with improving performance, even at the expense of decentralizedstructure.

2、Those whosee through all this, give up, and even discredit blockchain behind the scene.

3、Those whorespect the original intention and reality, and accept the blockchain cannotkeep up with the reality of centralized server performance. So what else can wedo? Is it still possible to build a truly reliable business model?

I don’t comment on the first two categories. of people and willcomment on the third because I am one of them and have more thoughts about it.

First of all, I believe that it is not necessary to compete withtraditional technology in performance, and it is almost impossible. Some peoplealso imagine that the performance of the future 5G network and quantum computerwill not be an issue, but in my opinion, these two technologies may make theblockchain do more, but can not change it in the face of centralizedtechnology. The disadvantages of time, and humans will always use thetechnology to the limit, large-scale applications will be built in the limitstate, and in the limit state, due to the architectural, the blockchain willstill be far behind the centralized server in performance. As a result, userswill still find the blockchain-based application “unable to use.”

But when we give up performance, we have to ask ourselves aquestion: What kind of application is worth the sacrifice? In my view, it mustbe paramount, but it is not a particularly large application for performance.For example, electronic money, electronic gold, large cross-border transfers?

These are all deductions based on the characteristics of theblockchain technology after we have understood. In order to create a free anddecentralized currency, the sages of the Cyberpunks had to invent theblockchain technology to realize their ideas after various trials and failures.

The two ideas are ultimately the same, and are these allcoincidences? I think it is inevitable.

Perhaps the decentralization, peer-to-peer, traceability andother characteristics of the blockchain can be achieved with more outcomes, butwhether it is from the source of the blockchain or the technical architecture,the genes of the blockchain are determined. Currently, The most logical landingis issuing tokens and transactions.

This leads to the second important topic I would like todiscuss: Is thenature of the blockchain token or chain?

This seems to be a conflict like chickens or eggs first. WithoutBitcoin, there will be no blockchain technology, and without the support ofblockchain technology, Bitcoin can’t be realized.

The two are inseparable, but under the unspeakable pressure, alarge number of successors, especially businessmen, began to intentionally orunintentionally isolate the concept of tokens and chains, and even advocatedthe token-less blockchain. These people are eager to extract thecharacteristics of the blockchain in addition to the token, and create newbusiness models and management models for their own use. Ironically, they are usuallyin the center of tradition and politics.

If the chain is essential other than tokens, we have to go backto the previous question again: what application is worth the sacrifice ofperformance? What kind of application that cannot be endorsed and solved by thecurrent powerful political and commercial centers?

The original centers shall use the blockchain technology toremove the center. Does this sound a bit strange? In fact, there is such aprecedent in reality. For example, the reform of the feudal dynasty into ademocratic system that changed an emperor to a parliamentary system and from acenter to a multi-center. This is also an improvement, so in this sense, I amnot completely against DPOS.

But from the history of the Bitcoin development and Cyberpunkfundamentalism, it is clear that the sages are not after parliamentary systems.They are devoted to a server node that is completely equal and a freecryptocurrency. Cyberpunks don’t trust the monarch, the parliament, and evenany centers in the power and commercial institutions built by them, such asfinancial tycoons and banks, etc., they have no essential difference in theeyes of Cyberpunks.

Therefore, when Cyberpunks invented the blockchain technology,they were thinking about how to limit the center. Now, the central powers onlythink about how to make it in their favor. This is an essential contradiction.When the two ideas collide, they will be different. Fundamental believers willargue that the fundamentalists are doing what they understand, and the centralpower and their affiliates will think that the blockchain technologyarchitecture is an unusable technology. It can not be the future of the game.

People whose vision is restricted by technology argue that it isa crappy technology, which is really a bit ridiculous. This is like theprisoners behind the bars feel that the restrictions, rules and regulations inthe prison can’t be done, and they can’t do it. It is a crippled livingenvironment…

The metaphor of prison is very vivid. First of all, theblockchain is indeed a technology that can put power into the cage. Then, whenpeople behind the bars feel that they are limited, should they first reflect onwhether they have done anything out of range, rather than thinking about how totransform the prison?

The problem is what are the main attributes of the blockchainthat can put power into the cage? Traceable and transparent? In fact, it is notbecause as long as the human being exists, you can forge any information beforegoing on the chain. If the source is not right, what is the meaning of theso-called non-tamperable and traceable? Even if the source is decentralized,such as many EOS dApps, these dApps use the blockchain’s openness to inventfake data, I believe that these fake data will be more and more sophisticated,and finally enough to fool outsiders. What is the meaning of the so-calledtransparency? How many people have the ability to detect and filter data?

In fact, to put power into the cage, the priority everyoneshould understand is, what is the check and balance of power? Or what is themain function of modern social power? Of course, first of all, we must admitthat the normal power structure can actually improve the efficiency of socialoperation, which is necessary for the current social organization structure ofhuman beings. But some powers are overdone and can have disastrousconsequences. In times of war, force was often abused, which led socialturmoil; and in peacetime, one of the most common practice is overissuing money.Eventually, personal wealth will be diluted and searched without restriction.

Cyberpunks are dying to pursue freedom and defend their privacyand rights in a technical and non-violent way. The first thing they have toface is the systemic ban and exploitation of various centralized parties.Breaking the manacles is the modern currency and the financial system. It isundeniable that these technical talents are remarkably accurate in striking themost important area. Only if you have money, your own money, you will not becontrolled arbitrarily, and you are qualified to talk about freedom. Otherwise,direct bank card freeze, foreign exchange restriction, and multiple times ofcurrency, how can you pursue freedom when survival is at risk?

From this perspective, the biggest value of the blockchain isactually the creation of decentralized cryptocurrency. As for attributes suchas immutability, traceability, and transparency, they must be done to achievethis ultimate goal, but they are tools. And in order to achieve a decentralizedcryptocurrency, isn’t the value worth sacrificing performance? Obviously, it’sworth it. Is there anything more tempting than the freedom of property toachieve personal freedom? Sacrificing some program performance for this is definitelya decision that can be made without thinking too much.

Remember that some Bitcoin forks have been created to promotethe performance of Bitcoin and then sell their own forks? These people havebeen attacking that the Bitcoin CORE team is code tyrants, old and stubborn.But in fact, I have checked the information of some people in the CORE group. Iam more inclined to believe in my own judgment. They are not. I am even moreconvinced that they are not willing to expand easily. There must be technicaland security considerations. I will not go into it here. At the same time, theywill not think that Bitcoin needs to add too many other functions. Thesefunctions are not the focus, nor are the things that the predecessors of theCyberpunks pursue.

Let’s review the core argument of this section: Is the nature ofthe blockchain a token or a chain? At this time, will you think that the chainis the nature which is more valuable than the token?

In fact, the blockchain has been built for a long time in historyfor creating this new monetary mechanism. And it can also build a new financialsystem, a set of guarantees for personal property safety and efficiency, thefinancial system of national border circulation, and finally this new financialsystem. It is possible to create a new production relationship or even a newsocial organization. Isn’t this more amazing than the business objectives of“blockchain+” and “+blockchain”? At the same time, it is more in line with thetechnical characteristics of the blockchain. Because of the circulation ofmoney, the performance requirements are not so high compared to theapplications of Taobao and 12306. Some large international financial systemshave only a few thousand TPS where blockchain is entirely possible.

Chains and techniques are just tools used to create tokens, anddecentralization is an effective method to achieve this goal.

Tools are tools, and human nature is human nature. Tools can’tchange human nature, unless it is artificial intelligence, unless humans havemastered the genetic engineering that can modify human nature.

Humanity needs centers. Human beings are born to be socialanimals. They will worship heroes and need leaders and social structures. Humannature is also complicated. True, goodness, beauty and ugliness will not changeor disappear because of any existing technology, and blockchains areimpossible. However, everything is extremely counterproductive. Absolute poweris likely to lead absolute corruption and excessive policies. Therefore,Cyberpunks hope to build a decentralized monetary system through their owntechnical expertise to counter and prevent this.

To our regret, after the Cyberpunk dissolved, there was noorganization to promote this idea. The mainstream took the opportunity toinvade and described a coin-making tool as a tool for building trust. The mediajoined the army, but the intention was lost, and the nature is blinded.

Can blockchain create trust? Yes! But why build trust? Becauseit needs tokens and tokens need to be trusted. And what if it existsindependently of the most powerful national system? That can only rely on the”technical + decentralized” system. Trust and decentralization aretools, and tokens are the goal. If there is a trustworthy existence besides”country” and “technology”, as long as it can also issuetokens, it is also optional. Unfortunately, it seems to have not beendiscovered yet.

Purpose, path, method, nature, derivative, I hope everyone canunderstand these concepts.

Last Question
If we have understood that the token is the nature and currentlythe strongest and most accessible direction of the blockchain space, issuingtokens, is to create a new financial system. So from a business perspective,can we still do it? Is it only the technical talents and the people who arepursuing freedom can participate?

Obviously not, the facts can prove that it is not because moneyand finance are the most basic facilities in society, and everyone is closelyrelated. This is why the predecessors of Cyberpunks choose this direction.

In the modern business models, there are always some productswith strong monetary and financial attributes. One of the lucky ones is aproduct that I am familiar with, that is, games. I mentioned earlier that I ama technical professional, but I didn’t say which industry is. It is actuallygame industry. I am an expert in both the client and the server.

In the eyes of ordinary players, the game is a product composedof pictures, art, sound effects and planning, but in the eyes of ourprofessional gamers, one of the most important elements is the numericaldesign, especially the large-scale games with a world view. In the numericaldesign, the most important thing is the design of the economic system. To putit simply, it is about how the gold coins are coming, how to spend, and how theoverall rhythm is designed. Gold coins are actually the currency in the game.Building an economic system based on gold coins is actually a closed financialsystem. However, traditional games, the issuance and circulation of gold coinsare entirely on the centralized server. In the blockchain space, we can learnfrom the ideas of the sages and use the blockchain to realize the decentralizedgold coin system. Decentralized gold coin system then lead to a new gamefinancial system.

So what advantages does the game have with this new financialsystem?

1、Goldcoins have decentralized credit endorsements (which may not be important in theeyes of many ordinary people, but it is important for game companies to have atool for self-certification and transparency).

2、It caneasily carry out global crowdfunding, get start-up funds (although manycountries prohibit, but I think that technology and tools are not wrong. It isthe unreliable businessmen and scammers that exploit humanity) .

3、Byissuing tokes and using airdrops or early bonus, it can get a large number ofinitial seed users which is convenient for low-cost project cold start(important for the startup team).

4、Gameswith gold coins and the financial properties of the blockchain will be morereal and more attractive to the players, which will greatly enhance the senseof reality of the game!

5、Blockchainhas opened up the economic system inside and outside the game, so thatblockchain games have more possibilities. Of course, the game’s numerical,economic, and financial system design will also face greater challenges.

6、Theglobal characteristic of cryptocurrency can help the game easily achieve globalprofitability (especially when the traditional game internationalization,payment channels are one of the most difficult issues and both foreign exchangeand geographical protection issues may encounter severe exploitation).

7、Decentralization,transparency, and the investment of the currency and other attributes, willencourage the project better understand the community’s opinions, but also knowhow to share the benefits, which will make the token game community more vitalthan the traditional game player group.

…….Maybe someone will be amazed that how could you do all ofthat by just issuing tokens? You must be exaggerating. As a gamer of ten years,I have discovered that it is really exaggerating after I have recentlyparticipated in various token games. It is only a good game that takes time topolish, and as a lot of blockchain gamers do not start a business and do not haveindustry perspective, they only see the BUG and design issues of various games,these are nothing but experience and time issues, not the direction.

Why is there such strong chemicals when the game issues a token?Under the bubble of 2017 and 2018, thousands of projects are all issuing theirown tokens, why are there few reliable ones? I think there are several reasons:

1、Half ofthese projects may only use the blockchain characteristics to make money.

2、Manyprojects that do things seriously are competing with performance, and evenpursue everything to be on the chain. They either encounter more problems orsimply give up.

3、There aresome projects that pay more attention to the design of the token. It is on theright path, but unfortunately, the token must be attached to the complexfinancial system in order to exert its true power. The real world is complexenough, the national system is strong enough, and the currency-based financialsystem has the necessary and space for existence. Many tokenized projects arevery funny. The so-called tokenized economy is just a set of reward mechanism,writing articles, or engaging in an interaction, and then giving you a tokenreward, which is actually not much different from points or mining. It can’t becalled a currency or financial system at all. Imagine if Bitcoin only had thedesign of mining and mining rewards, and then the Bitcoin had no complicatedand diverse application environment, would Bitcoin still have future? Can youbring so much change and imagination?

What does it mean? It means that not all commercial projects aresuitable for tokenization. If you only use tokens as points, you still need tosolve the problem of redeeming points. How do people earn points? Without arich economic system and financial system support, it can not consume, lend,circulate, and so it needs to be completely repurchased by the project? No, butwhere does the money from the project come from? Will the project always holdon?

In addition, if your economic system is not complicated enough,you will soon find the optimal solution, and then you may be arbitrarilyfailing in an instant.

Speaking of so many advantages of tokenized games, some peoplemay question: players in blockchain games are making money, who will consume? Istrongly disagree with this. I still think that human nature is human nature,tools are tools, and tools can’t change human nature and blockchain can’tchange the impulse of players to play games and recharge games. If playersdon’t spend money, there are only three possibilities: 1. The game is reallyunsatisfactory so no one is willing to pay; 2, the payment design has problemsor the payment card is not accurate enough; 3, it has identified wrong group ,and the investor and speculators cannot be consumers.

Ideally, a blockchain game should look like this: only tokensand a handful of core assets are on the chain; take full advantage of theadvantages of tokens to get the project started, community maintenance andinternational development; the decentralized economic system and the financialsystem are designed as the top priority, and the win-win ideas are implemented;finally, the paying group is found to achieve profitability, and the basicvalue of the token is used to carry the token.

Will there be such a game? I believe it will, and maybe everyonewill see a successful example this year. In order to avoid advertising, I willnot name it.

Finally, does blockchain games need a chain? Yes because afterall, the token is to be based on the blockchain, the core assets are also to beon the chain, but is the chain the goal? It seems to be not and the token isthe focus with the economic system based on the token and the financial systemas the primary goals.

In business, we don’t have to talk about freedom and revolutionslike the sages of Cyberpunks. Instead, the token is a must because this is themost powerful weapon that the sages have given us against traditional businessmodels. It is the most powerful weapon for us to overtake in business and fightagainst the giants.

The nature of the blockchain is the token and it is a tokenizedeconomy based on tokens.

Author:Hanson, Founder of TopPlayer
TopPlayer(TOP):The World’s First Professional Blockchain Gaming Organization, homepage :
Translator:Rex Liu, Blockchain and NeoWorld Enthusiast


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