YC
IPFS, CoinList, and the Filecoin ICO with Juan Benet and Dalton Caldwell
@ Y Combinator
07/01/17
Takeaways
YC
Y Combinator Cast
07/01/17
@ Y Combinator
The lean startup approach helps startups validate ideas quickly, which is crucial in the fast-paced world of cryptocurrency.
JB
Juan Benet
07/01/17
@ Y Combinator
Protocol Labs is a research, development, and deployment lab that I started to build the InterPlanetary File System (IPFS) project and Filecoin, aiming to create a space for innovative projects.
JB
Juan Benet
07/01/17
@ Y Combinator
I wanted to build an organization that could facilitate projects like Filecoin, which could be seen as a way to build collaboratively rather than in isolation.
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Juan Benet
07/01/17
@ Y Combinator
The InterPlanetary File System (IPFS) is a peer-to-peer protocol for distributing any kind of content, enabling efficient data sharing across various networks.
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Juan Benet
07/01/17
@ Y Combinator
Human-readable names in decentralized systems should map to content and require a consensus protocol to ensure their value and meaning are agreed upon globally.
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Juan Benet
07/01/17
@ Y Combinator
The challenge with human-readable names is that they often necessitate a consensus system, which can complicate their use in decentralized applications.
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Juan Benet
07/01/17
@ Y Combinator
Filecoin was created to incentivize the distribution of content within the IPFS network, addressing the market for storage where some people want to buy storage and others want to provide it.
JB
Juan Benet
07/01/17
@ Y Combinator
In the Filecoin network, your influence over consensus is determined by the amount of storage you provide, rather than your CPU power, which is a shift from traditional blockchain models.
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Juan Benet
07/01/17
@ Y Combinator
The rise of digital currencies and improved hardware infrastructure are key factors that differentiate today's decentralized projects from those in the past.
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Juan Benet
07/01/17
@ Y Combinator
The Internet's infrastructure is evolving, and while storage costs are decreasing rapidly, bandwidth improvements are lagging, leading to a perception of slowness in data transfer.
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Juan Benet
07/01/17
@ Y Combinator
The current state of digital currencies and decentralized systems is vastly different from the past, with improved tools and infrastructure enabling new applications and use cases.
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Juan Benet
07/01/17
@ Y Combinator
The current wave of technology is fundamentally different because it allows access to a range of applications that were once just dreams, making the goals of this wave more achievable.
JB
Juan Benet
07/01/17
@ Y Combinator
In the past, peer-to-peer networks were primarily focused on simple file sharing, but today's technology enables much more complex use cases, including smart contracts and decentralized applications.
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Juan Benet
07/01/17
@ Y Combinator
The introduction of smart contracts has transformed the landscape, allowing for trustless transactions and enabling a wide range of financial instruments to be created cheaply and efficiently.
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Juan Benet
07/01/17
@ Y Combinator
Silicon Valley's understanding of blockchain technology has lagged behind other regions, with many innovative ideas and projects emerging from New York and Europe.
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Juan Benet
07/01/17
@ Y Combinator
The motivation for individuals to contribute storage to the Filecoin network will primarily be financial, as they can earn money by providing their resources.
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Juan Benet
07/01/17
@ Y Combinator
The demand for decentralized solutions is driven not just by consumer needs but also by businesses seeking to distribute data across multiple providers for better security and reliability.
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Juan Benet
07/01/17
@ Y Combinator
The ability to create financial instruments through blockchain technology has drastically reduced the costs and complexities associated with traditional finance and legal processes.
JB
Juan Benet
07/01/17
@ Y Combinator
The development of decentralized applications faces significant user experience challenges, which must be addressed for mainstream adoption to occur.
JB
Juan Benet
07/01/17
@ Y Combinator
The future of decentralized technology will depend on overcoming user experience barriers and creating applications that meet consumer needs effectively.
JB
Juan Benet
07/01/17
@ Y Combinator
Projects like OpenBazaar illustrate the challenges of building decentralized platforms, as they require significant resources to develop both the underlying technology and user interfaces.
JB
Juan Benet
07/01/17
@ Y Combinator
The ICO craze brought significant attention to blockchain projects, highlighting the potential for raising substantial funds and driving innovation in the space.
YC
Y Combinator Cast
07/01/17
@ Y Combinator
The transition from vacuum tubes to transistors required decades of fundamental research and innovation, primarily driven by cost reductions in large-scale operations.
YC
Y Combinator Cast
07/01/17
@ Y Combinator
Massive monopolies, like Bell Labs or Google, have the resources to fund long-term research projects that can lead to significant innovations.
YC
Y Combinator Cast
07/01/17
@ Y Combinator
The funding model of Bell Labs ultimately failed due to the surrounding ecosystem and the breakup of monopolies, which made it difficult to maintain large-scale research organizations.
YC
Y Combinator Cast
07/01/17
@ Y Combinator
The rise of Silicon Valley and the introduction of stock options attracted talent away from traditional research labs, contributing to the decline of Bell Labs.
YC
Y Combinator Cast
07/01/17
@ Y Combinator
Bell Labs had a budget of $500 million in 1974, which would be equivalent to $1.5 billion today, highlighting the scale of investment needed for foundational research.
YC
Y Combinator Cast
07/01/17
@ Y Combinator
Innovations like self-driving cars require substantial long-term investment, often in the range of tens of billions of dollars over decades.
YC
Y Combinator Cast
07/01/17
@ Y Combinator
Google Brain exemplifies how large organizations can leverage advancements in machine learning to enhance their applications and reduce costs, effectively generating revenue without needing to sell more products.
YC
Y Combinator Cast
07/01/17
@ Y Combinator
The funding model of Ethereum allows developers to focus on protocol development without the pressure of immediate product monetization, as they can earn from the native token.
YC
Y Combinator Cast
07/01/17
@ Y Combinator
The current excitement around ICOs and cryptocurrencies reflects a significant shift in how projects can be funded and developed in a decentralized manner.
YC
Y Combinator Cast
07/01/17
@ Y Combinator
Addressing the credit assignment problem in collaborative projects could fundamentally change how value is distributed among contributors in open-source ecosystems.
YC
Y Combinator Cast
07/01/17
@ Y Combinator
The challenge remains to ensure that contributors to open-source projects are fairly rewarded for their work, as many do not receive recognition or compensation proportional to the value they create.
JB
Juan Benet
07/01/17
@ Y Combinator
In open source, a company can invest deeply in a project by allocating engineers to work on it, rather than just giving money to everyone involved.
JB
Juan Benet
07/01/17
@ Y Combinator
If we can create an algorithm that people can trust for fair allocation of rewards, we could improve many cap tables and grant funding processes in science.
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Juan Benet
07/01/17
@ Y Combinator
We can propagate rewards through open source, allowing people to invest their time in valuable projects instead of just money, leading to a new economic model.
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Juan Benet
07/01/17
@ Y Combinator
The current economic system is rigidly centered around traditional job structures, which limits people's ability to allocate their work to what they find most valuable.
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Juan Benet
07/01/17
@ Y Combinator
There's a significant difference between capital and value; the value of a dollar today does not equate to raw fundamental value, leading to misallocations in wealth.
JB
Juan Benet
07/01/17
@ Y Combinator
The distribution of wealth in crypto is often concentrated among a few early adopters, which raises concerns about fairness and value creation.
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Juan Benet
07/01/17
@ Y Combinator
We are considering issuing a token to contributors who have created value in our projects, which could change how we reward contributions in the future.
JB
Juan Benet
07/01/17
@ Y Combinator
CoinList aims to simplify the token sale process for project creators, allowing them to launch networks without the extensive legal and logistical hurdles.
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Juan Benet
07/01/17
@ Y Combinator
We are focused on finding high-signal projects in the token space and helping them gain attention and prove their value through independent third-party assessments. We want to ensure that CoinList lists projects that pass a certain bar of quality, while also avoiding outright scams on the platform.
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Juan Benet
07/01/17
@ Y Combinator
Investors using any management platform are ultimately responsible for conducting their own due diligence, but we aim to cut out a significant fraction of scams.
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Juan Benet
07/01/17
@ Y Combinator
We're working on ways to help project creators highlight their technical strengths and the value they propose, allowing them to stand out against projects that may have more marketing but lack technical depth.
JB
Juan Benet
07/01/17
@ Y Combinator
Accredited investors are a major part of our platform, but not all sales will be limited to them; some sales will be open to the general public.
JB
Juan Benet
07/01/17
@ Y Combinator
We want to enable non-accredited investors in the U.S. who understand the technology to participate in investments, despite the legal burdens of crowdfunding.
JB
Juan Benet
07/01/17
@ Y Combinator
Filecoin is not just a Dropbox replacement; it aims to replace cloud storage, allowing companies like Dropbox to consider using it instead of traditional managed infrastructure.
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Juan Benet
07/01/17
@ Y Combinator
Filecoin offers decentralized data storage, meaning that if a provider like Amazon decides to cut you off, your data remains accessible through the network.
JB
Juan Benet
07/01/17
@ Y Combinator
Filecoin should be viewed as a market layer across all providers, enabling those who currently do not sell their storage to enter the market and drive prices down.
JB
Juan Benet
07/01/17
@ Y Combinator
The challenge is to create a market that allows any provider to sell their storage, which could lead to better unit economics than centralized providers.
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Juan Benet
07/01/17
@ Y Combinator
Decentralization allows for a more efficient market by enabling individuals to leverage local optimizations for cheaper storage and distribution of content.
JB
Juan Benet
07/01/17
@ Y Combinator
Projects like Ethereum and Bitcoin are examples of decentralized systems that can provide better unit economics compared to centralized planning.
JB
Juan Benet
07/01/17
@ Y Combinator
There are many interesting projects to watch, including Ethereum, OpenBazaar, Zcash, and others that are building on new decentralized networks.
JB
Juan Benet
07/01/17
@ Y Combinator
Numr is a hedge fund that decentralizes data modeling, allowing participants to contribute algorithms and collaborate for better trading outcomes.