Blythe Masters may be helping to lead an industry-wide shift in the development of blockchain tech, but that doesn't mean her startup isn't experiencing its own changes as well.
Epitomizing the shift, Masters' heavily funded startup, Digital Asset Holdings, last week published a white paper with a subtle, but important difference: non-experts can understand it. Marking a transition in the company's focus, the simply titled paper – "The Digital Asset Platform" – isn’t written for developers that build tools, but for executives with the power to change the direction of a financial institution.
In conversation with CoinDesk, Masters laid out her company's efforts to capitalize on the white paper's impact, as well as its plans to give away part of the technology described to nurture an ecosystem of companies and strategy to maximize market share.
But, in spite of the focus on this audience, Masters hasn't significantly changed the company's internal organization in preparation for customer requests. Instead, she believes the New York-based firm that has raised $70m in funding will be able to rely on its existing resources.
The result of sales pitches to customers and investors alike, the paper underwent over 100 edits to refine the technical language describing the platform down to a 29-page document that explains everything from Digital Asset's distributed ledger platform to the creation of open-source libraries by third parties based on the DAML smart contract language, according to Masters.
"When you engage with us, when you sit and have a conversation with us, these are the things that we talk about," she said. "Having it written down means it can be leveraged in a way that we had not done before."
Decoding the platform
Masters said many of her potential clients have been acutely aware of the potential threat and opportunities that blockchian posed, but how platforms such as her own could help empower those institutions was less clear – something the white paper is intended to clarify.
To help map out the potentially disruptive and helpful forces of distributed ledger technology, the white paper breaks down Digital Asset's ledger into two components.
The first sets out its Global Synchronization Log (GSL), which relies on a blockchain to preserve the privacy of counterparties and notify them of changes to the state of a smart contract. The GSL was covered in greater detail in another white paper published in November.
The second component of the ledger, though, has received much less attention. The so-called Private Contract Store is a virtual container for all the validated smart contracts and terms to which the counterparty has agreed.
The non-technical white paper is Digital Asset's account of its service as a "fully centralized solution". To initiate adoption, only the "operator" of the infrastructure needs to adopt the firm's platform, leaving participants to interact as they do in a traditional network.
Think of it as distributed ledger training wheels: though the centralized adoption minimizes the benefits of the distributed ledger, the operator can begin the process of familiarizing users with the technology while leveraging its more transparent method of transacting.
Not only might regulators such as central banks become customers by using the platform to build a blockchain-based fiat currency, Masters said, but they will be capable of auditing the work of financial institutions.
Auditors and the market operator could be granted access to "re-execute" any contract's business logic to "interpret and validate the information", according to the white paper. Digital Asset calls this "distributed reading".
"The role for regulators to act as auditors – or in the language of the white paper, to become market participants – is an option and very much one of the positive features of the technology," said Masters.
However, the business-friendly white paper also lays out potential regulatory hurdles – warning of a potentially difficult transition period. Absent a single operator, a distributed network with multiple entities managing nodes could also increase risk, at least initially.
The paper states:
Giving away blockchain
To accelerate the rate at which such obstacles are overcome, Digital Asset plans to join a growing list of firms competing to give away the software on which their products are built.
Even as Digital Asset seeks to protect some of its intellectual property with a patent strategy, the shift in language of the white paper is part of a plan to lure developers to help create a vibrant ecosystem around the firm's platform. In August DA announced its plans to contribute the DAML smart contract language to the open-source community.
The exact date of the open-source launch has yet to be revealed.
Already, blockchain banking consortium R3CEV has open-sourced its Corda platform and it is soon expected to formally submit the code to the non-profit Linux Foundation’s Hyperledger consortium. Last week, after Chain open-sourced its own blockchain protocol, the startup unveiled its Ivy smart contract language with similar plans to make that open source.
Masters said that while she believes the world, generally speaking, will be improved if blockchain tech is implemented widely, the decision to open-source DAML isn't purely humanitarian.
Giving away the software "reduces the risk" for existing and future customers by preventing the firm from becoming "overly proprietary" and "mitigating" the chance of "vendor-lock in", she explained.
"We're very focused on the open-source community, making sure that our platform becomes progressively more open and therefore any dependency on Digital Asset can be diversified if necessary," Masters said.
The result, she hopes, is a larger piece of the market share of companies competing to provide blockchain solutions.
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