That has been the subject of debate surrounding Eris Industries and its blockchain solutions platform for some time. Founded in 2014, Eris has evolved to become one of the more novel projects in the blockchain space in terms of its operating thesis, officially launching in December with a goal toward a "1.0 release" this summer.
In its short history, Eris has made a point to trumpeting its belief that bitcoin should be thought of as a shared software database, not as a network for sending money or value. In the process, it has successfully highlighted the evolving debate regarding how the technology and its capabilities should be conceptualized and articulated to the public.
A focal point of Eris' view is that the same strong data management provided by the blockchain can be brought to "virtually any other business process".
Of note is the somewhat antagonistic nature with which Eris has sought to stress its belief that blockchains can exist without bitcoin, meaning they don't need assets like bitcoin that are tradeable and that have a floating market value. This view has naturally clashed with proponents of bitcoin who are financially incentivized to see its tokens, worth nearly $300 at press time, used more widely.
Given the hesitation by major banks toward the perceived regulatory risks of cryptocurrency, Eris has found a growing audience, and according to its claims, a number of business partners willing to use its blockchain tools.
Still, Eris COO Preston Byrne argues that this early customer base doesn't define the project and its goals.
He told CoinDesk:
"The biggest misconception is that we want to build stuff for banks. We're about providing developer tools for anyone and everyone to do whatever they want without our knowledge or consent. We're an open-source company."
In candid conversation following Byrne's address at American Banker's Digital Currencies + the Blockchain conference Tuesday, Byrne is more effusive in his praise for bitcoin as a technology. During the conference, he gave a somewhat breathless overview of blockchains and the Eris view on their utility, issuing comments that clashed with those put forth by more long-standing industry advocates.
"We had to differentiate ourselves, but to be honest with you, the public blockchain is an essential component of the private blockchain infrastructure," Byrne stated. "Bitcoin is the world's best, most resilient data source."
If Eris' concept seems unique, its origins are just as unusual. The project was originally produced after a $100,000 bounty was issued by entrepreneur Olivier Janssens on Reddit.
Though Eris won the contest by creating a way to decentralize the industry's leading trade organization, the Bitcoin Foundation, it eventually abandoned its focus on governance.
According to Byrne, the big break from the original idea occurred when Eris began exploring smart contracts, agreements between parties that can be executed in code on a blockchain. To date, the most significant advancements in this technology have come from the Ethereum project, though Mirror has touted an unreleased smart contract system for the bitcoin network.
The end result, he said, is that Eris wants to frame blockchain technology in the context of Internet architecture.
"If you look at bitcoin as a cash system, it disintermediates the IP of a financial institution. We're trying to make it possible to disintermediate servers on other types of computer networks where you need that consistency," he said.
A smart contract for a loan on Eris, he said, might look like a traditional loan, but attached would be a dynamic registry of changes stored away from the blockchain so it could be altered more dynamically.
"With a blockchain, the problem is you can't go back and erase something and block something out. The only way you can do that is making sure that the blockchain has a directory in it and if you refer to it at any time," he continued.
Byrne's view is that Eris is an attempt to turn an entire blockchain into a series of smart contracts, thereby allowing a forward momentum of data collection, history and management, but with the ability to change entries on the chain with more creativity.
The company prefers to think of blockchains as "distributed rulebooks" that can track changes and write permissions using private keys to achieve more secure data management. Eris' goal is to create software that enables developers to control who can broadcast transactions, which actions can be performed and how data is referenced on a blockchain.
Further, it seeks to enable blockchain structures to have more expansive coding for communication, ultimately using the collection of data into blocks as a way for those involved in the database management to agree on its history.
In practice, Byrne says Eris is a set of tools that include Eris:db, a database and smart contract management system, and Eris Worker, which allows developers to build libraries of smart contracts and related applications.
However, Byrne indicated that he can't "go into specifics" about the clients Eris claims as users.
"The use cases are far and varied," he said. "This can range from asset trading to something like compliance functions."
Because of its focus on non-financial applications of the blockchain, however, he said it is less involved with projects that involve asset trading, clearing and settlement.
The COO was equally opaque about Eris' revenue model, which he characterized as "service-based".
Network of blockchains
In practice, Byrne proves more moderate in his opinions than pundits such as R3CEV advisor Tim Swanson, though it's these critical takes on bitcoin's design that have helped to propel his company to the forefront of industry conversation.
Rather than believing that private blockchains will replace bitcoin, Byrne believes bitcoin's killer use case will come from serving as a trusted way to verify that activities on these private networks are occurring as their owners claim.
"If you ask yourself, 'What do blockchains do that nothing else does?', it's you have a consistent web server or SQL application with no central server. What does bitcoin do that nothing else does in the blockchain space? It's the most resilient to destruction and attack," he said.
These properties, Byrne said, would make a public blockchain like the bitcoin network an inexpensive way for companies to show proof their records have not been tampered with. As for what prompts users of private blockchains to use a public blockchain for this purpose, Byrne also has a clear thesis as well.
"If you combine a private blockchain with a public ledger verification mechanism, what you have is a very inexpensive way to create a data infrastructure without really doing a whole lot of scaling in a classical sense," he said, adding:
"It'll be smaller organizations that really benefit from this the most, financial startups have a burden to preserve their data and preserve your data and then on-demand by a regulator produce evidence that that data is correct."
Focus on applications
Byrne also discussed the work currently being done by Blockstream, which is broadly seeking to improve the bitcoin protocol through efforts such as the Lightning Network and sidechains, the later of which seeks to allow users to create alternative blockchains which are then interoperable with the bitcoin blockchain.
The COO suggested that he believes such projects, while well-funded, are perhaps misguided in their allocation of resources. As a competing system to cash payments, Byrne asserted, bitcoin needs more reasons for mainstream users to fulfill its original value proposition.
He spoke out against the idea that everything on a blockchain needs to be tied to a token with independent value, a development he called impractical. That's not to say he doesn't see the need for systems that can creatively govern these types of assets.
"If you want a currency to be used you have to have an infrastructure in which it makes sense to use it," he continued, suggesting that projects like a distributed Reddit, YouTube or Spotify would prove the most valuable in onboarding new users.
He believes that it is this application layer where the network can excel, as opposed to instances where data structures are less reliant on value, such as in corporate environments.
"If bitcoin is an internet currency, that's great, but it doesn't make sense until you can have services rely on bitcoin to work and there are people saying, 'Give me this currency, I'll give you a service. There are not enough peer-to-peer applications."
Image via Sid Kalla for BTCGeek.com