Dear reader!
Cryp2Gem team was honoured to host AllianceBlock Co-founders, a CTO Matthijs de Vries and CEO Rachid Ajaja and get a chance to do a live interview with them in the open community forum in our Telegram Cryp2Gem chat on the December 16th 2020.
Lots of interesting and essential topics were covered during this live event, so we made a summary for all that were not able to attend the event or anyone who just wants to go through the content again. Enjoy the read and visit our group for further discussions.
AllianceBlock is allowing traditional off-chain finance to enter DeFi while providing layer-2 regulatory and compliance framework. The hybrid (POA/dPoS consensus mechanism) layered architecture of AllianceBlock protocols seems a great combination of privacy, security and decentralisation that would work perfectly for governing the introduced regulated data layer-2 solution. Mainnet is expected in mid-2021.
Cryp2Gem team has written a research article about AllianceBlock. You are more than welcome to read it.
To be open and transparent — some of our team members are invested in AllianceBlock and own some ALBT tokens!
C2G: “Matthijs it is very nice to have you with us again after a couple of months when you joined C2G for an open forum event. So much has happened for AllianceBlock in that short period.
This is one very strange and special year. We have entered a bull run after a long crypto drought. On the other hand, all the world has encountered some limitations and restrictions due to the COVID-19 pandemics. How does that affect your work?”
Matthijs: “It doesn’t really affect our work with regards to daily basis. We have just opened a new office in Utrecht, NL, where the core development takes place. It’s kind of a big space with several areas, so there is enough room for social distancing. We have always been used to work remotely, you know, be decentralized but as a team, we’re also kinda close, so we do still come to the office quite regularly, except when somebody is having one of the famous symptoms. Overall, we work quite nicely considering everything.
On the other hand, when we are dealing with TradFi companies, you can see that things are moving more slowly than usual. But we’ll manage.”
Did You Know?
AllianceBlock has received a grant, the highest to date, from the Ocean Shipyard program, which helps developers and projects in building on Ocean.
C2G: “I have been browsing through your Medium Blog and your TG Announcement Channel today while preparing for this interview. I was very impressed to see how much was achieved in 2 months. There was so much media coverage as well.
Rajid (CEO and Co-founder, Rachid Ajaja) even gave a comment for CNN Business: “I can see a scenario where ethereum can potentially outperform bitcoin over the next year or so. XRP likewise has finally broken out of its downtrend.”
Does this already reflect on your business? On forming new partnerships?”
Matthijs: “Of course, it would lie if I would say no. This doesn’t rub off on DeFi projects as much as you think, but when dealing with more traditional organizations, it certainly is helpful that we are being featured more and more in such media. And it’s not like we are asking to be featured or pay to be featured, we are actually proactively being asked for our opinion. How cool is that?! This certainly helps grow the awareness of AllianceBlock beyond crypto, which is ultimately beneficial for us all”
C2G: “You had a couple of exchange listings (Liquid, 1inch), made a new website but most importantly, you launched Liquidity Mining. You have pools on Uniswap and Balancer I believe. How successful is the program from your perspective? Any tech issues you encountered?”
Matthijs: “From my view, the program is very successful. We’ve seen the liquidity rise significantly. This shows us that people believe in the project and feel comfortable putting in significant amounts of assets into the liquidity pools. What’s also really exciting about this is when other partners (like Frontier) join this journey together with us. It shows the true strength of the partnership, that we are confident in each other enough to share a liquidity pool like this.
With regards to tech issues, it certainly has been a challenge. Funnily enough, the smart contract development of the LM program was a breeze, it’s the maths involved before smart contract interactions are invoked. Especially when it comes to matching the math of Balancer, we’ve certainly run into some issues. But fortunately, we have a brilliant team with a lot of knowledge, passion and determination to go to the next level with this. It certainly looks very simple when you open the UI, but often it’s like this when it looks really simple, it’s only the more complicated under the hood”
Did You Know?
Coingecko is monitoring Yield Farming Pools. There are 5 liquidity mining pools with ALBT. Total value locked (TVL) in those pools is $1,4M.
C2G Community: “Can you explain in short why q1 will be the best period ever to ALBT? CEX, Coinmetro, partner announcement?”
Matthijs: “I can definitely, Q4 has been huge with regards to developing our ecosystem (onboarding partners). In Q1 you will see these partnerships come in to fruition with regards to product development. The first concrete example this week is Ocean, but we have started with several others already as well. We will go more in-depth in this in future articles, but even for this data tunnel use case with Ocean, other partners are going to be involved as well (and are already actually).”
C2G Community: “Thank you. If you have time, maybe you can say something more about how QNT and ALBT are connected. And how much ALBT is depending on Quant, or not? I know you're connected and that it’s deep but I can’t find exactly how.”
Matthijs: “QNT and ALBT go waaaay back. In this case, our Founder and CEO Rachid can tell you most about QNT, but what I can tell is that we are putting QNT to good use in the upcoming use cases. Feel free to pry about this though in our main Telegram channel.”
C2G: “Interesting question. I have learned about AllianceBlock a few years ago because of their partnership with Quant. Holochain connection and “The Brain” was interesting as well but I am not sure if the development on this AI is still on the roadmap.”
Matthijs: “AI is still going to play an important role in the AllianceBlock Protocol, the Brain is still on the roadmap. Even The Wisdom of Crowds app is not completely dead, everything is done with a reason, and everything will have its place.”
C2G: “Super cool to hear that. I loved playing Wisdom of Crowds game. Nice questions to check your general knowledge of crypto.”
Rachid: “Quant is one of the most important partners, they believed on us since day 0 and partnered with us because they believe in our vision even though we were still in a baby stage. We are proud to have them and we will have many fields where we will be able to collaborate.
We can t say much about the product we are building together but what I can say is that we are deeply working together to build a compliant and interoperable bridge between defi and traditional finance. A new wave of investment, p2p lending, monetizing real asset that institutional finance’s client hold, and much more.
A deep dive case study is being written, a white paper of this product for our joint collaboration but also the product that we will release. Stay tuned and I hope you are as excited as we are.”
C2G Community: “It’s the product I’m interested in the most actually.”
Matthijs: “Don’t close Telegram during Q1 2021!”
C2G: “I wouldn’t dream of doing that after today.”
C2G Community: “It is amazing to see all this collaboration and to learn how the different projects utilize each other in ways I could not have thought of!”
Rachid: “We believe in collaboration, we believe in creating an ecosystem of stakeholder where each participant plays an important role, this is the only way to build the future of finance, an inclusive economy which is fair and give chance to everyone. This is our philosophy and what we are trying to achieve. Hence each partner is chosen not based on hype but based on the impact that will have on the financial world by joining forces.”
C2G: “So let me ask you about Holochain and The Brain project at this point. Rachis can you share a bit more about future collaboration or developing the AI?”
C2G Community: “O yes. And are you looking into other AI projects as well?”
Rachid: “We are very much looking forward to Holochain tech to be live so we can integrate our Data Tunnel, build our reputation system and release a self-governance protocol based on reputation and not on how much token validators have. This goes inline with our participative economy and collective intelligence philosophy to create an inclusive and fair economy without barrier to entry.”
C2G: “The mining program was audited by Certik, right? Are you going to work with them in the future as well?
There are cases when the code was breached even though it was audited by Certik. It makes sense to go for more than one auditor. But the costs are higher then ofc.”
Matthijs: “Yeah, working with CertiK has been a pleasure so far. They have a very high level of expertise and really help us go to the next level. With previous problems found in code audited by CertiK, it was caused by insanely complicated algorithms that involved oracles or scammy deployments (deploying different code than audited).
We always make sure that our smart contract code is as complex as REALLY is needed, nothing more than that, exactly to avoid breaches like this (an audit, or even 3, can only bring you so far…). Besides that, our source is always verified on Etherscan, so you can check if the source code deployed is the same as the source code audited (always do that when in doubt, little tip…).”
Did You Know?
AllianceBlock will work with Ocean on a Proof-of-Concept that will include:
-generic data tunnel
-dynamic datasets w/ a subscription model
-single sign-on integration
- the foundation for a decentralized, reusable & anonymized KYC service on Ocean
“Financial data is one of our top goals, so we’re confident AllianceBlock’s proposal will drive adoption. AllianceBlock utilized mechanisms in the Ocean toolbox that few have, displaying their deep understanding of the tech along with the stellar quality of their code and the speed of development. We’re eager to see what their engineering team delivers in 2021.” said Alex Coseru, BigchainDB’s VP of Engineering for Ocean Protocol.
You can read more about that here.
C2G: “Few words about AllianceBlock Data Tunel — and a pilot you are going to work on with Ocean Protocol.
Did you receive any funds from them to work on that prototype? Or is the grant for the incubation of the startup in general?
I saw that the grant is highest so far — how much did you receive…if not under the NDA?”
Matthijs: “Yes, we have and it’s the highest Ocean Shipyard Program grant to date! Really exciting, but looking back on what the team has done so far and the creativity they brought to the table, I’m not that surprised. I’m really proud of them.
We haven’t received a grant before the development of the prototype, that came after once Ocean vetted the functionality of the prototype, our roadmap and the code associated with the roadmap. It was really cool because we received as feedback that we have utilized some things that very few had before, so we are confident we are absolutely going to make a success out of this use case! The grant is solely for this use case btw.
As for how much, I’m honestly not sure if it’s under NDA, so when in doubt, I’ll play safe and treat it that way.”
C2G: “Ramp DEFI and Frontier, both your partners, are going to work with NFTs. Ramp wants to tokenize illiquid real-world assets via NFTs while Frontier will also support NFTs for leveraging in lending, insurance and other features. Those NFTs can probably present real-world assets as well. Where does AllianceBlock fit in? With providing a regulatory framework for such NFTs?”
Matthijs: “Q1 2021 will be important for us as we will have working prototypes of upcoming use cases and for some use cases even an MVP or mainnet version. Having said this, in one of these use cases NFTs will play a huge role, is entirely connected to TradFi, and will be an important milestone to bridge TradFi with DeFi. At the same time, this use case (as all other use cases) will contain parts of the core of the protocol and its 3 layers, which, especially for this use case, will be an important part of the AllianceBlock Protocol’s foundation. Very exciting things can be built on top of this, and you will also see how Liquidity Mining will fit into all this.”
C2G: “NFTs will unlock some illiquid assets in the TradFi and open new ways of financing.”
Matthijs: “You got it! This is exactly what we’re working on.”
C2G: “That is super cool. So you need to connect with Centrifuge (you can find our research article on Centrifuge here). Although there are plenty of startups building solutions to bring TradFi illiquid assets on-chain and allow financing from the DeFi pool.”
Matthijs: “Definitely! And we don’t look to compete with them, we do want to provide the infrastructure for them in order for them to succeed. This is beneficial for all of us here ultimately.”
C2G: “In collaboration, there is a future for sure.”
Did You Know?
“Ethereum co-founder Vitalik Buterin, dressed like a medieval harlequin leaning against a velvet chair, stares past the viewer into the distance — that is, until he’s rocketed into the sky while ether’s price flashes on the screen. Ethereum is rallying, the image suggests.
A programmable version of the scene just described made records this weekend when a non-fungible representation sold for 260 ETH, or approximately $141,536.20. That’s the most paid, in dollar terms, for a work of crypto art to date, according to one of the painting’s co-creators, Trevor Jones.“ (nasdaq.com)
That is some serious money. There were a lot of accusations that crypto NFT art scene is used a lot for money laundering.
This space is young and immature. NFTs and the trading of those will need to be heavily regulated in the near future.
C2G: “AllianceBlock has partnered with several data processing and analytics blockchain companies lately.
You have teamed up with to new dAPI providers in the space, API3 and Covalent. Are those both mutual service exchange collaborations or you intend to use their indexing and analytics services?
Would they be interested in “The Brain”?”
Matthijs: “They will be very important to reach our mid-term vision, so the partnerships with them are important milestones in themselves. API3 will already start playing a role in the Data Tunnel use case with Ocean, especially with regards to trustless identity verifications.”
C2G: “The same question would apply to your partnership with Chainlink. Many use Chainlink for its data feed oracle service but announce a partnership with them. Which is rarely the case.”
Matthijs: “Well, Chainlink doesn’t have partnerships, just collaborations (which was also our announcement). However, we are equally important to Chainlink as we are able to provide highly sought after data in the midterm. This is also tied to something important we are working on, which we will do a deep dive on in Q1.”
C2G: “Chainlink has few partnerships, just not that many really. One of them is with Solana for example — to make data feed even more efficient and fast.”
Matthijs: “Whatever you call it, we will have something useful for Chainlink, and they will have something useful for us. Together we will make space a little bit better, that’s all that really matters in the end.”
C2G: “What makes AllianceBlock so attractive to partners, it seems like it is very easy for you to acquire high tier partnerships?”
Matthijs: “It’s because we firmly believe that the bridge we are building is really needed in the space, especially now. This bridge is not just beneficial for AllianceBlock, it’s beneficial for all of us. So why wouldn’t you want to partner with us and be part of this amazing journey and be part of the solution? On top of that, we have a stellar team, we work insanely hard, we have a good media presence and the right backgrounds to succeed. I think these are all important ingredients that make this “easy”.”
C2G: “How big is your team currently?”
Matthijs: “Around 15, including some dedicated freelancers, that are with us for a long time already.”
C2G: “That is quite a lot. Do you have enough funds for some time? Until the revenues hit hard?”
Matthijs: “Yeah, we are definitely good in this area. We don’t have a high burn rate too, we have started in a bear market, we know how to spend money (and how not to spend money) really well.”
C2G Community: “You mentioned that you don’t have a high burn rate. But are you already generating revenue?
The second part of my question is: I see you always try to have a use case when announcing a partnership. Is that something you actively work on when forming the partnership? We know there are a lot of partnerships where people don’t understand the reason behind it but I like your partnership announcements paired with a project/demo/use case etc.”
Matthijs: “We are working hard on having use cases that bring value and can thus generate revenue, instead of building merely a protocol the coming two years. End of Q1 and beginning of Q2 we will have the first use cases production-ready, and we will be able to start generating revenue.”
C2G: “I have to add that I also love to see how each partnership is explained with a use case. That makes the integrity of a partnership so much stronger compared to so many other partnerships that are made just for that — announcing the partnership itself .”
Matthijs: “Fully agree, use cases are important for us, as mentioned in my previous message, not only to be able to release parts of the protocol immediately and bring it to real-world use to generate revenue, but also because it shows the potential of the protocol, so others can build on top of it as well and benefit from this. Each partner needs to be useful in bridging TradFi with defi, so we select them based on that. As we have several use cases in the work, we can easily tie them to one or more use cases immediately.”
C2G: “What’s your opinion on real estate NFT’s — do you see this working in a business where all is very stringent and legally settled? This would be very disruptive, but would it be doable? That’s another thing. Real estate isn’t like travel vouchers.”
C2G Community: “Especially with the notary in the Netherlands.”
Matthijs: “There is still some way to go. I followed an experiment conducted in Sweden, and the land registry laws were outdated enough to make this impossible without a lot of workarounds. Surely, with enough lobbying, innovations and working together between projects, we can make it happen, but it’s not going to happen overnight right now.
Notary plays an important role in NL in a lot of official processes for sure. Fortunately, there are notaries that see the opportunities that decentralization bring and come together to see how/where they can help to further these innovations (source: our notary).”
Did You Know?
Based on Statista.com compliance teams worldwide spend several hours per week updating policies and procedures in order to reflect the latest regulations. The graph shows the stats for the last decade.
C2G: “You planned on announcing a partnership with a TradFi business in Q4 2020 but that was pushed back until Q1 2021. Is there anything to worry about there or are you planning on being compliant firstly?”
Matthijs: “Fair question, so because of Covid, there have been some delays (traditional organizations having more difficulties working remote, and of course are more affected in other ways than we are). But we go here for quality, not quantity or rushed decisions. We have something cool in the pipeline, which is not just in the pipeline but is gonna happen. And yes, in Q1. No need to worry. I’m sure it will be pretty satisfying and exciting for all.”
C2G: “We have something cool in the pipeline, which is not just in the pipeline. Noted!”
Matthijs: “Hahaha! In the pipeline as in - we are working on it, but we are working on it can still mean it will not happen, but this one will happen.”
C2G Community: “What do you think about the secondary market for tokenized RE? Do you think it’s possible to make the RE market more liquid?”
Matthijs: “I think there are huge opportunities, and it has our attention! We haven’t started working on this concretely though, but definitely started exploring possibilities for the protocol with regards to RE too.”
C2G Community: “I believe the Hybrix team is located in Utrecht also. They are working on interoperability. Have you met with them?”
Matthijs: “I haven’t! Sounds super cool! And I’m immediately excited, will look into this.”
C2G: “They seem to be building an interesting product. Do check them out.”
Matthijs: “Anybody with a Utrecht in the office is automatically a winner of course.”
C2G Community: “I am also impressed by your collaborations. How do you meet all these people? Do you do strategic research and outreach by email? Or does it happen organically at conferences, for example?”
Matthijs: “Mostly through our network. Don’t forget, we are 2.5 years in the making already.”
Did You Know?
Compliance & regulation is a growing concern for many industries, especially for financial services. In the past, many organizations have viewed compliance as an expensive inconvenience but when the correct policies & procedures are adopted, it can be a significant cost saver.
“It takes less time to do things right than to explain why you did it wrong”
Some interesting stats in the infographic (source: intuition.com)
C2G: “You have made some good partnerships lately with startups from the crypto/blockchain space. But as you want to help traditional finance (TradFi) to enter decentralised finance (DeFi), when can we expect the first player from TradFi entering the AllianceBlock ecosystem? Q1?”
Matthijs: “Q1!”
C2G: “Can I ask what the current role of Amber Ghaddar is please, she seems to be flying a little under the radar or is she working hard behind the scenes making news connections, deals and partnerships?”
Matthijs: “Extremely hard with regards to business and ecosystem development. Once the TradFi partnership is out, she will join an AMA on our own channel to go more in-depth about it.”
C2G: “Rachid has written an article »Bridging The Gap: Why DeFi Could Save Our Economy« that was published on the official NASDAQ website today. Is that a first step towards the traditional finance world? Not everyone gets an article at NASDAQ.”
Matthijs: “Yeah, and despite some people thinking we have pushed our publication to Nasdaq, we were actually asked by Nasdaq to provide it.”
Rachid: “Indeed, in order to bridge defi and traditional finance we need to focus on product building being easy to use by DeFi users but also compliant for institutional finance. Also, media is super important, and having a presence in well-established media, bring awareness and why DeFi space is important to embrace by traditional finance.
Hence our focus as Matthijs said very well on the right product, on our market fit and also our media presence. This combination will help us achieve our ambition and make both worlds embrace our vision.”
C2G: “Tradfi is ‘slowly’ embracing bigger Crypto: Canada allows Ethereum ETF’s and CME announced the ETH futures.
Do You see this happening in the EU soon?
Would like to know the view of a well-positioned insider.”
Matthijs: “We do see this happening in the EU too. You can’t compare countries and jurisdictions, even within the EU, or the EEA, we have talked to several top tier financial institutions in the past 2 years (partially because of being incubated by Kickstart Innovation in Zurich, Level39 in London and Station F in France) and what they all have in common is that they are experimenting with blockchain, definitely see the potential and value to them, but they are currently unable to fully enter DeFi. Hence, the bridge we are building.”
Rachid Ajaja, CEO and Founder of AllianceBlock said, “Our collaboration with a leading blockchain monitoring and workflow automation like PARSIQ is particularly timely in light of the announcement of our partnership with Ocean Protocol earlier this week, through which AllianceBlock will use Ocean Protocol’s data marketplace and core technology and simplify compliance with financial regulations like GDPR and PSD2. We look forward to working closely with PARSIQ to further achieve our goal of bridging the gap between traditional and decentralized finance.”
C2G: “Rachid could you comment your collaboration with Ocean? And the works on pilot with them? ParsiQ is an important player here as well as it seems.”
Rachid: “Indeed, this is really important. We are building not only a protocol but an ecosystem. For example, the Data tunnel is an important step to democratize the decentralized data economy. Deleting the barriers of wallet, private keys and public keys in order to publish data, will bring traditional data providers to this space through our Data tunnel.
In addition, not only this product will be built with Ocean, but it will be a hub for other companies, such as ParsiQ, Covalent, API3 and other projects and partnerships that we will disclose later one. For example, ParsiQ community will be able to build dataset thanks to ParsiQ amazing tech, these datasets will be based on the event and can trigger action. They will be able to monetize it and publish it on Ocean data market place to our Data Tunnel or in another world through our Data Hub.
The possibilities are endless and we are super excited to play this important role of making the tech easy to use, without barrier and bringing together projects and communities to take part to this ecosystem and the bonus is that they can make money from their work.”
C2G Community: “Would you say the recent DeFi hype and adoption has changed your exchange strategy? Because you are not only listed on DEX but you also mentioned about your liquidity mining program. Is that something you did because the community was demanding it or are there other reasons as well?”
Matthijs: “Liquidity Mining is an important part of our ecosystem, but it’s not an exchange listing. Do you maybe mean Liquid? Which indeed, was a choice based on the fact that they are one of the few fully regulated crypto exchanges out there. They are working very professional, and fit our goal of bringing traditional finance together with decentralized finance.”
C2G: “You had a Seed Round back in 2018. So that is 2+ years from the Seed funding. Recently the first batch of seed investor’s tokens got unlocked. Honestly, there was some drop in the ALBT price expected. But it just didn’t happen. Your early investors believe in you and in what you are building. That is great recognition. Can you comment on that please?”
Rachid: “We have a huge and amazing seed community. They are warrior and believers, they were patient. They have invested in founders before investing in the project. We are super lucky to have them, and as you said even after first unlock we have seen super stronghold.
Also as you know we are one of the very rare projects that have 0 VC in seed, its only community based, and you can see the difference. We believe in our community and this drives us to deliver and make you proud.”
C2G: “I love this. And this shows how important a community can be for a startup.”
C2G Community: “It is great to hear the AllianceBlock’s Liquidity Mining Program is an important part of your ecosystem!”
Rachid: “Indeed it is important (LM part). I will give one hint: It will be part of our final product which is Cross Chain Investment Pool Terminal with Impermanent Loss hedging and optimal strategies to maximise liquidity miners P&L!”
C2G Community: “Now we have something for all the detectives!”
Cryp2Gem team is always available for any further discussions in our social media. Looking forward to all the feedback.
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