Recently, we had an opportunity to speak with NULS CEO Liesa Huang after her keynote speech at the World Blockchain Summit MARVELS in Hong Kong. Less than a year old, NULS is a visionary blockchain company which is attracting a lot of press recently. They are close to launching a new product called Chain Factory, which purports to simplify the process of creating a blockchain. We talked to Liesa about her views on the industry, token economy and much more.
Tell us how you got started in this industry.
Like many people in the industry, I started first as an investor. That was back in 2016 and soon I was drawn in by the technology. Technology fascinates me, blockchain and its potential. I couldn’t stand on the side as an investor anymore, I wanted to raise awareness and encourage adaption of this new technology. I talked to quite a few blockchain project leaders, but when I came across NULS, it felt like home. They had a very clear mission, and our visions aligned. There is a lot of noise in the blockchain world, and hype, but NULS came across as calm and focused on delivery. There was no turning back, I had to join the team. When I joined NULS, my ambition was to bring it to the next level. To make it a truly international project, with a solid commercial team. One of the advantages of a commercial platform, over a purely community-led project, is that it has a core of full-time staff to drive an agenda in the early stages of development and adoption.
How would you describe blockchain to someone who does not know about it?
Our goal is to simplify blockchain onboarding, so that it will not be necessary for programmers to understand cryptography or base-level blockchain tech. That said, it is always good to understand the basic fundamentals of any new technology. Think of blockchain as another class of “thing” like the internet – a decentralized information technology – a layer which runs on top of existing internet protocols. It allows for the distribution and recording of digital information in a secure way, essentially, creating a new type of internet. Originally created to transfer the sale of a digital currency (Bitcoin), the international tech community is finding more and more potential uses for the technology. At the end of the day though, most people won’t need to understand blockchain, it will be the IT system off-camera, the system which underpins business, in much the same way as mobile payment systems facilitate the O2O (online to offline) market in commerce.
Blockchain is supposed to make data transfer fast, but due to its distributed nature, it can take longer than traditional payment systems such as credit cards. How do you see blockchain overcoming this?
Blockchain was not originally conceived to make fast transfers, but to make transfers transparent and permanent. Of course, now everyone wants faster transfers which is understandable. That is the reason why NULS and other techs are focused on cross chain solutions – to facilitate unlimited scaling by connecting side chains. This development means TPS (transactions per second) will no longer be a problem for blockchain. Currently, for example, a single NULS chain with a 2m block size has a TPS of about 8,000.
Do you think blockchain will be as “big” as they say it will?
Undoubtedly yes. It’s what we call a disruptive computing paradigm, there is a new shift every decade. The first was mainframes and personal computers, then came the internet which revolutionized everything, and more recently mobile and social networking. Blockchain is the current emerging paradigm which will connect the world in a new way using cryptography. I think within the next two years, when there are more successful real-world applications, people will stop asking the question, is this the next big thing?
Which industry sectors do you think will benefit most from blockchain first?
Blockchain is a great way to record the movement of many parties in an ongoing transaction. This makes it ideal for the supply chain industry, tracking a product from source to end destination. An efficient, streamlined supply chain could dramatically boost global trade. According to the World Economic Forum, reducing supply chain barriers could increase global GDP by up to 5% and global trade by 15%.
At NULS, we are focused on developing partnerships in the supply chain industry, but also other growth sectors – the gaming industry, for instance. Since 2013, the gaming market has grown rapidly at the rate of about USD 10 billion a year. Gaming is perfect for blockchain because it facilitates the trade of in-game tokens and items, solving the problem of isolated digital assets. By placing digital assets on the blockchain, players can exchange in-game assets on a peer-to-peer marketplace for cryptocurrency, which can then be sold for real-world currency. By adding real-world value to digital assets and storing them on the blockchain, a new form of e-commerce is created. Furthermore, blockchain makes it easier for users to switch between games and to carry their digital assets with them. This could boost the entire gaming industry ecoystem exponentially.
What is your understanding of a good token economy?
Token economics refers to the design and implementation of the economic system of a blockchain ecosystem. In this economy, participants pay for services or are incentivized by token payments for doing their part in keeping the system going. Every platform has its own token economy model. The first step to designing a model is to choose a consensus model, Bitcoin uses proof-of-work (POW), for example. NULS use a more effective consensus method called proof-of-concept (POC) which requires staking to run a node.
Essentially, a token should add value to an ecosystem, it should have a reason for being, not just exist in name only. When assessing an ICO (initial coin offering) or STO (security token offering), ask how will this token hold up as a real value of exchange? What type of consensus model will be applied; staking is good for many reasons, primarily that it locks up tokens, securing demand and the safety of the network. Ask, what is the token distribution system? Don’t just look at the primary distribution during the ICO or STO. Secondary distribution should also be considered, tokens released at a later date. Additionally, an investor should ask, where will these tokens be sold, on what reputable exchange, and how will the company support the demand for the token in the future?
Many Asian countries are talking about becoming cashless societies in the next few years. Do you see cryptocurrencies gaining a real-world impact in Asia faster than the West?
In China, it is true, I don’t even carry a purse when I go out. Everyone pays with their mobile phone, the infrastructure is there, from vending machines, to street vendors to restaurants and stores. China skipped the credit card stage and went straight to mobile payments. In the rest of Asia, the race is on to facilitate mobile and cryptocurrency payments. By 2021, Euromonitor International estimates that southeast Asian merchants will be handling about USD 32 billion worth of mobile payments per year – 10 times that of 2013. It’s a phenomenal market.
MC Payments is a strong partner of NULS, and they aim to create a stable cryptocurrency for offline payments, and the project will run on the NULS platform. We will have more details about this soon. In addition, HENA, a Korean project also partnering with NULS is focused on payments as well. Outside of Asia, we are also keeping an eye on Africa and South America as emerging markets in this space.
NULS is a Chinese company, how do you plan on delivering your vision to the west?
I wouldn’t say NULS is a Chinese company per se, but a world-wide open source project. The core team are very much invested in the western market, building our presence through social media and the news. We are in the process of hiring a regional director in the US, based in Silicon Valley, and we have two other regional directors, one in Korea and Australia. We are taking this in steps, build the technology and technical community first, and helping enterprises onboard. We want to deliver results.
The vision of NULS is easy to understand: make blockchain as simple as possible. This is not just a Chinese requirement, but something the world wants. I love to talk with anyone who wants to make blockchain more relevant, we are open and easy to converse with.
We noted your excellent talk at the MARVELS investor conference recently. Can you explain why you think institutional investors will be attracted to investing in NULS?
NULS is focused on delivering a real practical solution to enterprises who want to benefit from this new emerging technology called blockchain. Big investors understand business and the potential market gains, which is why Bitmain chose to invest with us. Wu Jihan, Bitmain’s founder, heard what we are doing and took less than 15 minutes to make up his mind to invest.
Can you give me your NULS elevator pitch?
Would you like to build a blockchain in a few minutes? People are surprised when I give this pitch because they are so used to hearing about the entry barrier problems to blockchain. Problems like complexity, long project lead times and lack of blockchain developers. Our new product Chain Factory hopes to solve many of these problems by providing a simple click-and-go modular architectural system which cuts out a lot of the expense, time and complexity.
Finally, it’s fantastic to see a female CEO. Why do you think there are so few women still in blockchain?
Blockchain is still in its infancy and many of the founders are tech people. The tech industry as a whole has a dismissably low track record in attracting female talent. Women can offer a different perspective, so I hope to see more join the blockchain world. Recent statistics show that only about 5% to 8% of crypto-investors are female, so encouraging women to take an interest in investing and working in the industry would benefit the entire movement.
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Image Courtesy: NULS