Overview
The AMA took take place on June 30th, 2019 from 15:00 to 16:00 UTC in the CryptoCalibur Chat Room.
From the Dusk team were present:
- Emanuele Francioni
- Jelle Pol
- Mels Dees
- Pascal Putman
Hi Dusk team! is the testnet ready?
We always had the intention to combine our token becoming liquid alongside a major technical release like the testnet and things are lined up for release within a week if no major issues arise.
Could you describe the token use case? Does it become a direct or implied store of value in any manner?
The use cases intended for DUSK include but are not limited to:
(1) payment for transaction fees,
(2) payment for the cost of deploying dApps,
(3) atomic swaps and One-Way payment for XSC-based tokens, and
(4) rewards for staking and various contributions to the network.
XSC is our smart contract standard, for added clarity. The primary use cases will center around network utility, where given sufficient volatility and the right mechanism design (game theory) have the potential for value to accrue sustainably. There are also many secondary use cases within the dApp ecosystem or as a platform token for more regulated markets. A good example could be fundraising; like how Ether was used for fundraising during the ICO phase of the market, we foresee similar functionality for Dusk in the STO market.
When will Dusk be listed on exchanges?
As always we cannot disclose the exact date that we're going to list. But it's going to be in July for sure! We want to list together with other amazing news that we've been working on.
When could we see the first STO launched on Dusk?
The first STO will be launched officially when the mainnet is released, however there are plenty of partners doing test runs on our upcoming public test net to make sure everything is in place. We are working through a pipeline of business announcements over the coming weeks and these will include STO partners, where there are parties included that will bring repeated issuance to the Dusk Network protocol.
Partners are typically in closer contact with us during this stage of development as they are keen to find a solution that they can use repeatedly. However companies looking to do a one-time STO are also in our pipeline and progressing nicely.
That said, whilst we are very happy to work with parties to guide them through the process of an STO, we (the team) are by no means required for these parties to host one on the Dusk Network. Anyone can use Dusk.
What applications for the Dusk Network are you working on at the moment and, In your opinion, what is going to be the first killer use case?
Dusk was designed to be a privacy-oriented blockchain, with the goal to provide more than just payments. In the process we furthered the field of zero-knowledge cryptography to make zero-knowledge smart contracts feasible.
The combination of privacy and a programmable smart contract standard allow for the unique combination of privacy and compliance, without storing (and therefore without revealing) any sensitive data. These characteristics make Dusk Network a match made in heaven for the financial industry, where compliance and privacy are arguably the biggest requirements. This is why our adoption strategy focuses on the security token market, which is in need of a purpose-built blockchain.
Is there a fee to launch an STO on Dusk platform?
Basically launching an STO on Dusk entails creating an XSC contract and submit it on the Dusk blockchain as a smart contract transaction. For that, an issuer needs to pay fees. You can compare it with the gas fees paid on the Ethereum chain for deploying a smart contract.
Can you give any more details about the potential pipeline of STOs? Are there any big names that can grab attention and put security token offerings on the map? I have seen too many dead end projects trying to chase easy money with an STO. What this industry needs is a big household name - similar to what Facebook could do for crypto in general
Whilst I cannot disclose the exact names ahead of time I can attempt to provide a bit more colour perhaps. Firstly, I agree with your assessment that we will see a lot of projects simply abusing the possibility of an STO to replace an ICO / other means of ''easy'' fundraising. These are obviously not the type of propositions that we are looking to help. That said, we also do not want to exclude small/medium sized enterprises from the STO landscape by only focusing on large partners, hence working on smaller propositions as well. Finally, yes we are working with 2 large household names in the traditional finance industry that are both looking to bring roughly 5 assets to market each upon our mainnet launch, with a further ~25 to follow in 2020/2021. These are your typical institutional powerhouses that want to be first movers into the tokenization space.
The first of the two we should be ready to announce late July / early August, and will resonate within the finance industry on a similar level as the Facebook example you just gave.
These players, whilst definitely interested in the technology/innovation aspects of blockchain, are mainly enticed by the idea of additional liquidity, automation, and increased access for investors as well as assets.
In the 'crypto world' that you and I know the idea of owning small fractions of assets and 24/7 trading are commonplace, but this is not necessarily the case in traditional securities markets.
So we could expect MainNet in next few months?
In short, yes. We are doing the best we can to follow our initial roadmap estimation. Of course, given the fact that we are pushing the boundaries of what is currently possible within a few fields (i.e. trustless and hyper zero-knowledge cryptography, pool-resistent consensus, privacy-enabled proof-of-stake), we need to deal with unexpected hurdles all the time. However, I am confident that the major technical Gordian knots have been untied.
Regarding STOs, are you planning to specialize in particular jurisdiction?
Dusk can be used globally and we invite all assets from all countries to make full use of our protocol. That being said, we are based in the Netherlands and since late 2018 have been researching existing Security Token standards and spending countless hours researching any possible need for global functionality. So even though we are very comfortable that we satisfy the compliance & privacy requirements for EU, we have kept an open-mind and assessed global requirements.
What information can you guys reveal about the Bitfinex partnership?
We've been working together since just after summer of last year. We were the first project through their IEO platform Tokenix, and collaborate on various other items. We are working on something very exciting, but for updates there I urge you to keep abreast of our announcement channels, where we will hopefully be able to share more mid-July specifically around this question.
Will Dusk also support other smart-contract standards beside XSC? (something like Erc20 for ICOs?)
The Dusk VM is a zero-knowledge -based virtual machine. You can virtualize any decentralized program provided you pay the required gas. XSC is the "abstraction" on top of that which provides the smart-contract interface for issuing, transact and govern regulated financial assets and security tokens. There are a few other standards in the work which target different kind of use-cases outside of regulated financial assets
On your website, you wrote that Dividends will be paid with Dusk tokens, the idea is great and makes sense because Dusk uses privacy but what if a company prefers to pay dividends with a stable coin?
With the zero-knowledge VM it is very easy to create a privacy-empowered stablecoin. If the stability method is asset-based (like Tether) even XSC can be used for that. If it is algorithmic (like DAI), it can be created directly on top of the VM
I saw that 1 transaction uses ~2kb, are there chances to reduce it?
~1kb to be precise. The space required to create a confidential transaction is quite big. However the advantage to use Bulletproof transaction is that we can aggregate multiple transactions together so providing only an additive O(log(m)) group elements over the length of a single proof. In practice the more transactions we aggregate, the more space-efficient the blockchain. We are also working on decreasing the payload.
Isn’t 1kb is very low for the implemented privacy?
Actually zk-snarks are more efficient in terms of both space and verification time. This at the price of trustfulness (snark relies on a trusted setup) and other unacceptable inefficiencies (for us), like the need to rerun the trusted setup for any contract change/upload.
Since FATF ruling and other official bodies focusing heavily on regulations, how would you make sure the privacy feature becomes compliant with AML/KYC solution and ever evolving regulations?
The privacy implementations used in Dusk Network are principles based if you will, with flexibility to allow for changes depending on who uses the infrastructure where. Regardless of legislatorial changes it is reasonable to assume that there will always be a need for KYC/AML, trade secrecy, auditing, preventing market manipulation, etc. We are the layer0/1 infrastructure to support all of this on-chain, but the party deploying the smart contract can add their own flavor/configurations according to what’s relevant to their propositions. Obviously, we are closely involved in / monitoring all regulatory progress.
Any plans on the marketing side of things? I remember there was a huge flurry of interviews/reviews online about Dusk, even Balina giving it an 84 rating.
Yes very much so. We've been a tech driven team so far and we are now exiting stealth mode to accompany our technical releases, business achievements, and crypto developments such as exchange listings. Consider today a kick-off;)
Will the KYC/AML info be on-chain?
Not exactly, the outcomes of the KYC process will be stored in zero knowledge, effectively allowing a party that issued securities to enforce their relevant restrictions. Crudely put you can compare it to a whitelist. There is never any personal data stored/collected on-chain.
For example a large franchise emitting 10% new shares in France will have different requirements vs a small family fund in Asia. However both need similar building blocks to configure their respective requirements.
How would you make sure that the immutability of such data, that is private lets say in the instance of personal things, can be verified and tracked back for an Audit.
If we zoom in purely on how it would function within a XSC based token, let's say in the security token use-case. Auditability is offered through a view-key exclusively to the contract_owner. The View-key is constructed by encrypting the transaction values and other helper items to not only the address of the receiver (as Monero or Zcash do it), but also to the address of the contract owner and the auditor, if necessary. (Interestingly, this does not even slightly impact the size of the transaction).
Within this example, this view-key helps them see which whitelisted address owns how many securities only. As they've performed investor identification, they know who is behind the whitelisted address, and the personal data that issuers are required to keep are thus not shared on-chain. A three-way Diffie-Hellman key exchange to be more precise.
I saw the chrome add-on you guys released recently. Can anyone run that add-on and technically be rewarded in Dusk tokens?
The current version is a demo version, but there is a concrete roadmap to delegate (increasing) part(s) of the consensus mechanism to the browser, allowing people to earn real Dusk via network participation through the browser.
However we are working to finalize a marketing campaign that will keep people busy with similar participation in the interim.
Can you elaborate further on staking, who will be able to stake, how will staking be administered, and how soon will it go live?
There are basically two different staking techniques within Dusk, the blindbid (which is essentially the first and most efficient privacy-oriented staking methodology to date) which is a confidential commitment of Dusk operated by so-called Block Generators and used to mitigate the sybil attack in generating blocks. Thus, there is the Provisioner staking, which is the stake committed by the committee of voters with the task of validating and notarizing the blocks. This will go live with the Testnet, where we will experiment with different configurations wrt rewards, lockup times, slashing, etc.
Dusk is a permissionless network. Everyone can be a block generator or a provisioner. Since the network is quite efficient and its performance is negligibly impacted by the amount of Provisioners or Block Generators, we encourage everybody to participate and will make the minimum stake requirements as accessible as possible
Could the tokenization of precious metals on Dusk also be a topic?
We are actually very excited about commodities trading. Many crypto investors are crypto-natives that are currently investing in arguably one of the most innovative spaces there is, however they are also starting to open their eyes towards more traditional assets. Diversification of your portfolio to precious metals like gold, silver, copper, etc, or other traditional financial instruments such as funds or exchange traded funds (ETFs) is a trend that we're seeing gain some traction. I personally believe there is a huge market for tokenized versions of these products. We are working with two partners on tokenized commodities in the gold and diamond sectors, and also on index/fund products including similar commodity/precious metal exposure.
Will there be an application to manage my Security Tokens that normal people can use?
Yes, this will be conceptually similar to current blockchain coins, where you can either keep assets directly in your own Dusk wallet, or in the custody of an exchange platform or equivalent venue.
How connected is Dusk Network to the rest of the blockchain crypto zero knowledge community?
Very. We work closely with many renowned researchers in the space, often consulting each other on the latest improvements. A good example is our lead cryptographer Dmitry, who invented several hashing algorithms, and broke a thousand more. Him, Luke, and Kev from the team recently attended ZK-Lux to share more about Dusk and meet their peers. See ZKlux#1 and this Tweet for reference.
Is there any track record of the development team delivering or participating in blockchain cryptography endeavours of this scale?
Our lead cryptographer (Dmitry) invented the mining algorithm of Zcash and is the author of hundreds of novelties in the field of cryptography used practically by every chain in some capacity (including Bitcoin). His latest work, Hades and Poseidon hashing algorithms, are the fastest hashing in ZK cryptography. Our blockchain tech lead (Kev) has led the Golang reference implementation of NEO node, our senior researcher (Toghrul) has been in CityOfZion since its inception and Jules has been working on Ethereum and other tokens practically since he started to code. Everybody else has significant experience with blockchain as well as cutting edge technologies for market leaders such as Amazon, TomTom, Sony, excite, etc
Thank you CryptoCalibur & Dusk Community for all of your excellent questions!
These are the links to some of our socials:
👀 Dusk Network TG announcements
👉 And, last but not least Dusk Foundation Twitter!