CCN had the opportunity to speak to FIO Protocol founder David Gold. The Foundation for Interwallet Operability is Gold’s brainchild and part of a larger effort to create a user-friendly blockchain experience.
The most notable aspect of FIO is that it provides decentralized naming services for blockchain wallets. In layman’s terms, it’s like a decentralized DNS for cryptocurrency.
Okay, that doesn’t work for some laymen. In the same way that DNS makes it so you don’t have to know the IP address of every website you want to visit, FIO will allow people and wallets to register human-readable addresses.
Gold says the idea occurred to him when he was still working as a managing director for Access Venture Capital in Westminister, Colorado. He handled many of the blockchain-oriented deals for Access.
“There’s certainly a lot of people who have their fingerprints on it now, but it was my idea. […] It was really through that experience [as a venture capitalist at Access Venture Capital] that the idea for the FIO Protocol came to be. I saw what was going on with blockchain and crypto. On the one hand, I was like, Wow, this is a big disruption that could be as big as the world wide web was. But at the same time I also felt similar to how I felt in the early 90s – while it has amazing potential, the technology has a long way to go. One of the big areas that jumped out at me was usability.”
The naming service runs on a completely independent network. The security and operation of this blockchain will be funded with FIO tokens. Still in beta, FIO plans a public beta in the third quarter of this year. A number of wallets and one exchange have so far joined the foundation, however.
The composition of the foundation is important to its success. The reader will surely recognize at least one of the names on this list:
Coinomi and Mycelium alone are two of the most popular cryptocurrency wallets in use today. ShapeShift is the trailblazer of the concept of non-custodial token swapping.
“Without a solution like FIO, the visions around blockchain will never happen. They’ll never get beyond what I call ‘crypto gold.’ An alternative speculative investment. We’ll never get beyond that unless these usability problems are solved. And that’s what this cryptocurrency industry consortium is all about. It’s designed with industry players from the start.”
Paul Puey of Edge wallet, which is a member, praised Gold and FIO (in a separate interview with CCN) for their approach to enacting the new convention. By approaching recognizable names in the industry and seeking co-operation, FIO is ensuring that the protocol will achieve some degree of success. FIO functions as a non-profit. Protocol usage will support the foundation and further development. Various services have costs associated with them, such as registering a new human-readable address. The majority of the funds will go to the nodes who support the network, while a smaller portion will go to the foundation.
“The FIO Protocol is a non-profit foundation. The FIO protocol will be completely open source and tokenized with the FIO token. The foundation will receive a share of the initial tokens out of the gate, so it will have a tokenized value from the beginning. The foundation also receives a small percentage of all of the inbound commerce. Most of the tokens that get sent out to pay for FIO services go out to the nodes on the delegated proof-of-stake network, but a small percentage goes to the foundation. So the foundation will always have a source of income to operate with.”
Gold started his career as a NASA employee. During the dotcom boom, he was a successful entrepreneur. From there, he moved into venture capitalism with a firm called Access Venture Partners. After a long career, he stumbled onto crypto through his work as an investor.
When he looked at the way the technology works, he realized that the prospect of actually using cryptocurrency is daunting for new users, and decided to do something about it. Thus, FIO was born.
He didn’t go in with blinders on, however. Attempts have been made in the past to do what FIO does. He noted that a problem with the Ethereum Naming Service is that actual protocol-level changes had to be made in Ethereum for it to work.
Gold says of ENS:
“The other (maybe more important) problem with Ethereum Name Service is that it only works on the Ethereum blockchain… users will never be comfortable with a different user experience for different tokens/coins in their wallet.”
FIO will work without any changes to any existing blockchain. That’s the whole point.
Gold says that most in the crypto space have a “build it and they will come” mentality that doesn’t always match up with reality. This is why he chose to integrate industry partners from the beginning.
The FIO protocol introduces another important feature that cryptocurrency lacks: the ability to construct a “pull” transaction. Crypto’s design keeps users in control. However, FIO lets payment requests go directly to the wallet.
In this way, merchants and customers can be sure that the correct addresses are being used. There is an attack vector in cryptocurrency where very similar addresses can be covertly inserted to a user’s clipboard. If the user initiates the transaction after that point, they lose the funds unless they’re going to the correct address.
This vulnerability is eliminated in a world where such “pull”-type transactions are possible. Instead, the merchant sends what amounts to an invoice to the user’s FIO-enabled wallet and the user has the option to then send the funds. The protocol also makes refunds a lot easier by enabling “transaction context” for every blockchain.
“When we talk about ‘user-friendliness,’ we include merchants as users. The protocol will be integrated by crypto payment services as well. The FIO protocol won’t solve every issue merchants face, but it will solve a bunch of them. With merchants, it’s got to be easy to do a refund. They’ve got to be sure that very few users who pay with crypto have problems.”
The FIO protocol will be widely available when it eventually launches. Blockchains themselves don’t have to do anything to implement FIO. Wallets can make use of open SDKs from FIO to correctly implement the solution. Open source and decentralized, any wallet, exchange, or merchant that wishes to make use of it will be able to do so. Foundation members will be first to have the software ready for live beta testing later this year.
Gold told CCN that the cryptocurrency space is years away from the vision it started with. This sentiment is shared by many crypto veterans at this point, some of whom predicted much higher market valuations and others, like this reporter, who once truly believed that by now we’d be able buy coffee with crypto just about anywhere.
“In fact, we’re in a world where most of what’s happening in blockchain is in centralized services. […] If crypto just keeps being an investment asset that has no real value in commerce, this is never going to go anywhere. The usability issue, again, is a core part of what has got to be solved for this to happen.”
Gold is doing his part. Some notable payment processors and other industry players like Coinbase have yet to cast their lot in with FIO. After studying the protocol, it’s hard to believe their doing so is anything but inevitable.
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Last modified: June 11, 2020 8:44 PM UTC