Prasaga swaps smart contracts for 'smart assets' to scale its layer 1 chain

Ashton Addison: What is Prasaga, and what problem is your team solving?▶ 00:20

Jay Moore: We started with an IoT smart city interoperability solution. We were confident that if we could build it, we could build a marketplace behind it and give people autonomy over their data. They could decide what sensor data or information they wanted monetized, and that could be a new way of breaking down the walled gardens around data silos. After our first infusion of capital, we realized very quickly that scaling our technology wasn't the issue. Scaling on the blockchain was. So we spent three years looking at all the projects out there, thinking somebody must have the DNA for getting scaling right, and we couldn't find any that would deliver the throughput we needed. We put our heads to it ourselves. We've now got the patents filed, and we've got proof that the core technology works.

Ashton: What was the breakthrough?▶ 01:50

Jay: This is my 12th new venture, so I've been here a few times, but this was by far the biggest. The aha moment goes back to technology built in the 1980s: a first-class object model applied to an operating system. We took that operating system, like what's in OS X or Windows, and applied it to the blockchain. So we now have a full operating environment running on top of the blockchain, not just smart contracts being moved around. That has changed things at a meta level.

Ashton: Scalability is table stakes. What makes Prasaga unique as a layer 1?▶ 02:40

Jay: We built the blockchain with innovative consensus and a number of things that make us very efficient. The key, though, was to get away from smart contracts and move to what we call smart assets. We can do that because the operating system runs on the blockchain. All of our code runs live and is fully inheritable, so as an application developer you have direct access to new classes as they get built. We also store state in the account on the blockchain. With the serialization that happens in smart contracts, that wouldn't work, but here we can move your account from shard to shard. That keeps accuracy, with no double spend, and gives us the full parallelization possible across multiple nodes. That's the big sea change. It also means you can use any language to build on top of the blockchain, so developers can focus on the consumer problem, not the blockchain problem. It's like the cloud, which cut the cost of getting to market.

Ashton: Ethereum's virtual machine feels like DOS, and what you're describing sounds like Windows. Is that fair?▶ 04:55

Jay: That's the best illustration we've been able to come up with. With DOS you could run one program at a time. Now we can run multiple programs simultaneously across chains. The user interface also improved dramatically. We're working on how hard it is to build in Solidity and other development environments, and we break through that. We're just now showcasing early versions of our tool set on Hyperledger. We put this extensible blockchain object model up there to prove it has the functionality we say it does. When you're innovating, there's the belief that you've solved it and then the proof. We had to provide that proof before we could raise the next round to build the mainnet.

Ashton: What are the first steps in bringing decentralized finance tools to Prasaga?▶ 05:59

Jay: The key is building the fundamental marketplace. We're building a platform that lets developers license their technology as they build it, whether it's for DeFi, supply chain or any other class tree. There will be a licensing architecture for royalties, so people can monetize their R&D before they ever bring it to market. For DeFi, it will be easier to fractionalize and easier to build the core components, because you're moving assets rather than writing lots of smart contracts. Instead of a large, rigid code base, you work in something extensible. That's why we call it an extensible blockchain object model. Nothing in software is static. Everything is a living piece of code, and we're much more fundamentally built for that.

Ashton: Beyond avoiding Solidity, how will you attract developers and foster the ecosystem early on?▶ 08:11

Jay: Fundamentally, it's the idea that we can help people monetize before they get to market. We want to build the community, ecosystem and infrastructure that creates the proof of concept and the product-market fit, and gives developers resources to build around. We've got a venture studio model that will align with a lot of blockchain incubators and accelerators, as part of our Data Grid Collaborative. We think that will inspire innovators and also the larger corporations we work with, so they can bring solutions to market faster. We're looking at everything from enterprise supply chain to identity and insurance technology. The problems solved on blockchain so far are fairly simple because they have to fit inside the smart contract paradigm. We take that away, and now you can look at much larger-scale projects across all these verticals.

Ashton: Where is the Prasaga Data Grid token at, and how does it support a sustainable ecosystem?▶ 10:31

Jay: It's funny, we're about four years past when this was the paradigm for a layer 1, but we're using an ERC-20 token to generate the resources we need to build out the full system. We're doing that in a DeFi model on pairs. At some point we'll also have centralized exchanges. We're giving 9.75 APR on our tokens, so there's an incentive to stay in and work with us. The other piece is building out other components and giving visibility to our partners as we go. The token will be exchangeable one to one for the native token when mainnet goes live.

Ashton: What sets the token's monetary policy apart?▶ 11:28

Jay: This is politically incorrect, but I think it's important: we're not building this token for speculation. Will there be speculation? Absolutely. But we built it with an algorithm that builds your own digital GDP. If you read our white paper, you'll see we're pegging it against an internal rate of return based on the economy of the token itself. Over time that makes it a much more stabilized currency to exchange with. Over the next 10 years it goes from being a token you invest in to a currency you invest with. We haven't seen anybody else try to address the fundamental instability of a token as a way to exchange value rather than store it. I think that monetary policy is one of the most innovative things we've looked at.

Ashton: What are the major milestones ahead, and when can we expect the mainnet?▶ 13:08

Jay: Dates are always so great when you're talking about software. I've been doing this for 30 years, and I came out of the video game space, where you ship when it's fun. We're looking at a testnet within 12 months, and our goal for mainnet is within 18 months. Some things need to happen on testnet, like how we engage with the miners and how we bring partners to market so they're part of our launch. This next round is about getting the marketplace up with the royalty architecture in place. We're also launching a demo on April 1 that puts a graphical user interface in front of what we're doing at the command line on Hyperledger. You'll be able to see how this is a different paradigm from smart contracts.