The Cryptonomist had the chance to interview Lone Fonss Schroder, CEO of the new blockchain called Concordium.
Tell us about Concordium and what is the vision. With so many blockchains already in development, why Concordium?
The main idea here relays on three fundamental pillars:
- We have designed and built Concordium for the Enterprise world like for Fortune 500 types of companies and financial institutions and eventually for individuals. And we have committed to providing Enterprises and Individuals with a fully regulable solution by design- vested in the protocol.
- Existing Blockchains are either not fast or they are not secured. They are interesting experimental projects. Concordium chooses to be fast and secure from day 1 using a unique technological science-driven cryptographic approach.
- And last but not least, the fuel of our network is our token, the GTU which is Concordiums cryptocurrency, a payment token that can be used to send and receive digital funds.This payment token is making is possible for fast, direct transfers that are guaranteed to be secure through the use of several encryption methods.
There are already dozens of leading companies that are collaborating with public blockchains such as Ethereum and Cardano, why should they switch to Concordium?
Concordium can live aside and can inter-operate with networks being it permission or non-permission based blockchains. However, there is a big demand for proof of stake (and thus eco-friendly) compliant, secure and scalable additional blockchain and not least because of our ID management at the protocol level. We believe that providing such qualities in a blockchain is a prerequisite for large scale up-take. Users will choose to use our network for purposes where the business model needs a public blockchain that requires both compliance, speed, and security.
What do you think about Decentralized Finance, and what is Concordium’s vision for the finance of the future, will there be a DeFi on Concordium too?
It depends on what you call DeFi. Nowadays, DeFI is a kind of buzzword that everybody is trying to leverage to achieve some different goals. If you mean by DeFi or Open Finance, a global, open alternative to every financial service we use today, so Concordium will play a bridging role between the Legacy system and the DeFi world.
Our blockchain is ideal to build on for those who plan to offer real use cases like Savings, Loans, Trading, Insurance and many more. Concordium could also support from a technical and strategic point of view Central Banks e-Money projects. We hope that our GTU will help Enterprises and Individuals to transfer value in a compliant, secure and fast decentralized environment. Let’s not forget Concordium is a dPoS project where Stakeholders will pay a “central” role. Sorry for the joke. A decentralized role!
Hundreds of thousands of developers are already working on web3, the decentralized web that uses advanced privacy technologies. How is Concordium positioned in relation to web3?
Concordium is a Tier 1 Protocol, we are not a fork of X or an experimental application of a theory-based protocol. And therefore, we consider ourselves an integral part of the web3 environment. We do believe in privacy as a basic human right but with accountability. This is why we have the ID mechanism built into the protocol with ID issuers and revokers to ensure compliance. We believe in privacy as a value to protect in the financial world and this because without privacy, the Enterprise world is not comfortable to adopt Blockchain. Thus, Concordium is a strong contributor to the emerging PrivacyTech environment. Our protocol offers a full privacy-centric approach by implementing a solution based on Zero-Knowledge proof together with the best cryptographic practices. Let’s not forget that our CTO is Torben Pedersen, the father of the Pedersen Commitment.
Plus, using a very unique sharding-driven approach, Concordium will allow creating dedicated blockchains that will be able to use our Finality tool as a service. Concordium will thus promote Finality as a Service, meaning FAAS.
Concordium promises to solve the scalability trilemma by offering a secure, decentralized and extremely scalable blockchain with almost immediate transactions. Can you give us an overview of the key aspects of the Concordium protocol that will make it the best performing blockchain?
There’s a kind of paradox in the Blockchain industry today. If blocks are produced in a fast way (like Ethereum), security is dropping and visa versa (like Bitcoin). We can easily remember several cases of security breaches on the Ethereum network, which produces blocks every minute. However, networks that embrace a security-driven approach, e.g. Bitcoin, loses in scalability. Using the legacy blockchain you need to choose between security and scalability. This is what is today the common approach. But these blockchains can´´ support the need of enterprises and the financial sector. Concordium however, is both secure and fast. How? Let me dive inside the consensus approach.
First of all, Concordium is a dPoS project.
Second of all, we do believe in a Dynamic Block time approach. Meaning, we go fast if the ecosystem allows it and we reduce speed if the conditions are not met to go faster. Think about a car driving on the French streets where speed is limited to sometimes 60 or even 30km/h. It could reach 150 km/h easily if the same car is driving on a German highway, where there is no speed limitation. So Concordium is this car. We will go fast when this is possible but we will reduce speed in a dynamic way if and when the conditions are not met. Other blockchains will break if the speed of the underlying internet is down.
How do we reach this? We reach this by implementing a Two-Layers Approach. Our first layer is a Nakamoto Style Consensus (NSC), meaning our Blockchain is faster and more secure. Our second layer is the Finalization Layer, based on Bizantine Fault Tolerance (BFT). Using NSC allows Concordium to produce blocks faster, and even though Finality takes time blocks can be committed within a short period of time. Our Blockchain will allow putting as much as possible blocks between two finalization processes. Then we get high throughput.
This is how we cheat the CAP theorem (Consistency, Availability, Partition). In general NSC Blockchains are about availability and BFT Blockchains are about consistency. At Concordium, we get the best of both worlds!
Why create a new programming language for Smart Contracts, what improvements does it offer compared to the languages already present in the blockchain space?
We do not expect that there will be a single language meeting all types of smart contracts and we expect to see an evolution towards the best languages for specific domains. At Concordium we have decided to initially base our smart contracts on an existing language, Elm, which offers a number of benefits. In particular, the compiler checks for and prevents many common mistakes, which allows for very robust smart contracts. Furthermore, the language is very easy to use and has a very active community.
As mentioned we do not expect that this will be the one and only smart contract language, and we are closely following the status of existing domain-specific languages and will extend the language support when we see fit.