Anthony Di Iorio, the billionaire co-founder of $50 billion blockchain network Ethereum and cryptocurrency wallet Jaxx, said that Chinese blockchain projects such as Qtum and VeChain will succeed.
“The biggest stake for me is in Qtum and VeChain right now, the two Chinese projects. There’s much more opportunity in newer ones if you can identify them,” Iorio said.
VeChain, the Ethereum-based Internet of Things blockchain protocol in China, has attracted well-respected developers, venture capital firms, and large-scale institutions throughout the past six months.
Most recently, the VeChain team disclosed that PwC, one of the Big Four auditors, have acquired a stake in the project, and announced a partnership with multi-billion dollar logistics giant DB Schenker to use the blockchain in processing sensitive information.
“By collaborating with third-party logistics providers in China, DB Schenker can offer extensive and seamless logistics solutions across China for any industry and trade. However, the immense potential of such a comprehensive logistics network is challenged by the complexity of measuring the performance and service quality of their business partners,” the VeChain foundation said.
Building blockchain protocols in itself is difficult and technologically challenging, as blockchain building essentially is solving unprecedented cryptographic problems with dire consequences. A simple error in a smart contract could result in large-scale security breaches and loss of funds.
Building a blockchain protocol and convincing conglomerates, institutions, and businesses to utilize it to secure data rather than more efficient database technologies is even more difficult, because developers need to convince businesses to overcome the trade-off between decentralization and flexibility to use blockchain technology in the right way.
The blockchain is not database technology; it cannot process an unlimited number of transactions and information, and in its current form, it can barely process hundreds of transactions per second. Ethereum creator Vitalik Buterin emphasized that it is possible to reach a million transactions per second on the Ethereum blockchain with Sharding and Plasma enabled, but the industry is still several years behind.
As such, for blockchain projects, it is of utmost importance to secure partners like VeChain’s partnership with PwC and DB Schenker to build, solve, and investigate together on various methods that could be utilized to commercialize the blockchain at a large scale.
Iorio said that investors should also look for emerging projects that are capable of leading wide adoption of the blockchain, similar to the works of Qtum and VeChain, both of which are based in China.
In September 2017, the Chinese authorities effectively banned cryptocurrency trading but has not banned cryptocurrency businesses and blockchain projects. In fact, the latest multi-billion dollar funding of blockchain startups by the Chinese government reaffirmed its support for blockchain technology.
During an interview with Bloomberg, Iorio added that while the creators of Ethereum including himself, Buterin, and Charles Hoskinson were comfortable with the regulatory nature of Ethereum and its non-security characteristics, it was “great” to get reaffirmation from the US government that it is not a security.
If the US SEC had categorized Ethereum as a security, it would have had shut down the entire industry in the US in an instant, forcing companies to move out of the country. The SEC’s clear statement that Ethereum is not a security demonstrated the intent of the agency to see continuous development in the blockchain sector.
Last modified: May 20, 2020 8:40 PM UTC