Hackernoon logo"Decentralized Governance is an Existential Cultural Shift" - Ben Jorgensen by@Sergeenkov

"Decentralized Governance is an Existential Cultural Shift" - Ben Jorgensen

Andrey Sergeenkov Hacker Noon profile picture

@SergeenkovAndrey Sergeenkov

Cryptocurrency analyst. Founder and editor at btcpeers.com

As one of the most phenomenal inventions of our time, blockchain technology saw the light in the distant 2008, ushered in by  Bitcoin. the brain-child of mysterious Satoshi Nakamoto, whose identity remains unknown, this technology step by step took serious attempts towards reengineering society. 

Blockchain was the first to pose a  radical idea – what if we try to cross out the third party standing in the way between business and our client? 

Wouldn’t it be more efficient to cooperate directly with the consumer, without having to accommodate the redundant intermediary? Although it took some time for this idea to gain ground, eventually it took root – thus, implicitly pointing at its future role in a larger economic restructuring that is about to take place.

So, being originally conceived as a back-ledger of Bitcoin, blockchain came to be regarded as an independent technological entity. Owing primarily to its features like immutability of data storage and full transparency, blockchain remained technically deprived to be further lifted on a wide-scale use. Until the moment when Ethereum stepped in.

The brainchild  of Vitalik Buterin, it  fixed many flaws in the original idea of blockchain and, most importantly, brought new functionality into the concept. With the arrival of Ethereum, it became possible to design decentralized apps (dApps) on top of the network – all thanks to the smart contract feature.

This was a major upturn, which gave a spark to the whole new radical movement, commonly referred to as Decentralized Finance (or simply, DeFi).

With dApps being predominantly nested on the Ethereum blockchain network, originally the app developers and users were astonished by its unparalleled functionality. Faster processing power, larger capabilities in terms of network capacity and storage – what else could they dream of? However, in the course of time, it became evident that the Ethereum blockchain is far from being the limit of all aspirations.

One curious incident proved it – and the blame for it lies on cats. Within just 1 week of its existence, CryptoKitties, a decentralized Ethereum project that was launched in 2017, caused a major network backlog that eventually put Ethereum on halt.

That served as a good example to see just how far the most popular blockchain protocol is from being perfect. The new solution had yet to be found.

And, three years after, it finally arrived. Called Hypergraph Transfer Protocol (HGTP), this new piece of infrastructure introduced by Constellation Network centres its functionality around the extended number of data sources, thus allowing interoperability of data both from the protocol as well as external centralized records (such as other blockchain networks).

Such feature alone allows Hypergraph Transfer Protocol to be upscaled to use on a broad organizational level, ensuring that the information flow (data flow) would be smooth, secure, and unhindered. In a sense, Constellation’s Hypergraph is revolutionary  – never before has blockchain been so efficient and scalable, not to mention the fact that data now can be oracelized, i.e. transferred on a cloud application. Now, blockchain is closer to being the technology that will lead society to the new edge of freedom, as envisioned  by Satoshi Nakamoto.

Constellation’s vision was to build out an ecosystem where any developer could build next generation applications that focus on tokenizing data. To highlight their capabilities, they brought to the world its HGTP-built swapping platform, Lattice. This crypto-trading platform is equipped with multiple automated market algorithms, all of which will be based on Hypergraph Transfer Protocol.

Being the first communication infrastructure and protocol of its kind, will allow traders to retrieve the latest information on liquidity pools, which gives a possibility to infallibly predict the next trading move and best return. 

I prepared a few questions for Ben Jorgensen, Co-Founder of Lattice Exchange and CEO of Constellation Network, with the hope of finding  the answers to the most concerning topics surrounding DeFi. We also talked about the idea behind HGTP protocol, the Constellation Ecosystem, the role of the Lattice Exchange, and what changes they will bring to the world.

Andrey Sergeenkov: First, let me ask you a question: how many years did it take to come up with something like Hypergraph Transfer Protocol? Where did this idea originally come from?

Ben Jorgensen: The Hypergraph Transfer Protocol is actually the brainchild of one of our founders, Wyatt Meldman-Foch (CTO). I met Wyatt in early 2017 where he presented the idea of an alternative network that was distributed and decentralized and would be an ecosystem of data being exchanged (tokenized data). He basically talked about the limitations of existing blockchain technology, centralized data management and security, and the lack of infrastructure tools that could provide security at scale. Furthermore, no real developer was going to use existing blockchain technology because it didn’t mirror existing architectures that developers use. 

The profound vision is that Constellation would use an  existing distributed system architecture, called a DAG (directed acyclic graph - or a graph based database) , which is currently used to organize the world’s data (think LinkedIn, Google, Twitter) but in a centralized capacity. Our vision would be to deploy this architecture across globally distributed and decentralized nodes. In order to achieve this decentralized network, we would need a highly secure and scalable consensus mechanism.

As such, we architected a consensus mechanism, one of the core tenants of blockchain technology, to run across this graph based network and database. Something that no other company has been able to achieve because of the complexity of a non-linear network (like all the other blockchain protocols) - thus we had to redefine a consensus mechanism that would be similar to how you optimize a centralized distributed system for data querying (ex. Machine learning requires data querying - and machine learning (AI) requires a lot of data).

Constellation successfully achieved all of this by creating the Hypergraph, the globally distributed directed aclycic graph network, PRO (proof of reputable observations) consensus mechanism that is random and run by mathematical proofs, and HGPT and the Hypergraph Transfer Protocol (HGTP) becomes the protocol, tool, and means of communication for data across this autonomous network. 

Andrey Sergeenkov: Now the question is, “how does this show up for the average person?”

Ben Jorgensen: The best way to understand this is to draw on a movie reference like “The Terminator”. In the Terminator, all of the robots are communicating to one another with no human centralized command and control. All of these machines are exchanging data between different machines, processing, then creating logic to allow them to be autonomous while programmatically predicting outcomes, and identify targets (think of targets as distributed nodes or clusters).

The only way these robots, the Terminator species, can exist is to exchange and process data in real time - this is a decentralized environment with no one kill switch. I think I might have painted a picture that we are building Skynet - we aren’t - but this could be a plausible outcome of a HGTP - a communications protocol and network that is autonomously governed by a consensus algorithm built on reputation (Just imagine if a Terminator started behaving poorly - it would be removed from the system).

The underlying way that these autonomous robots would communicate would be through a secure communications protocol built to scale as more nodes and clusters (robots) came on the network. It is a wild vision that even the US Air Force is trying to imagine how fighter jets communicate autonomously with one another while removing the human factor. 

Andrey Sergeenkov: How many years, do you think, it would take to build a solid blockchain-based economy? And what would be the consequences of it on a societal level? From your perspective, what are the stimulating factors that can accelerate the blockchain adoption?

Ben Jorgensen: There are many layers to a blockchain economy that need to be considered as we contemplate what “adoption” means. In one perspective, “blockchain” as a concept is widely adopted.

So while the industry of “blockchain” has been acknowledged, there is still a lot of trepidation by major companies and developers to use this technology and they all pertain to scaling: procuring and deciding to go with one infrastructure or another; technologically scaling to integrate with existing development environments; and understanding the business logic on whether blockchain solves a financial pain point. 

It is a really fascinating industry that evolves the foundation of open source communities with a financial layer. I have never seen a movement like blockchain where people BELIEVE it can do so much more than what it is capable of doing today. It is like an addictive relationship where you keep thinking someone will change and your friends and family just wait for that co-dependence intervention conversation.

Building a blockchain ecosystem means building out a community that will adopt your blockchain’s capabilities and will build and support your technology.

It means, building out marketing language that educates people on the innovation and helps them define use cases that relate to pain points for individuals and organizations. It also means building trust on the business side with major organizations that can adopt your framework to improve their business and workflows.

And of course, it means building a piece of technology that is easy and understandable to implement. This all takes time as the industry of blockchain is established, but organizations are not readily committing to working with any given company.It is almost as if working with one company would demystify their concept and magic of “blockchain”. In 2003, Palantir was a very innovative technology and struggled to get fundraising on Sand Hill road. It took them 10 years to get going and now they are a multi- billion market cap that recently IPO’d. Like most early innovation, it takes a long time to see adoption.

I truly believe there is no thing as failure - failure is a mindset. Anyone or any business with a bit of persistence will persevere. I can name a million successful startups that “failed” in the eyes of a few but in the end just kept going until it started to click. The whole blockchain and cryptocurrency industry is just in this adolescent state that is persistent on figuring out “the click”.

Andrey Sergeenkov: For many people, the main fear associated with the paradigm of decentralized governance lies in the absence of a rigid regulatory framework. Do you think this is something that can be overcome?

Ben Jorgensen: Over the past two decades we have been open to new models of corporate governance. Tony Hsieh, former CEO of Zappos, popularized a method called holacracy which broke down traditional corporate hierarchies in an effort to fuel an entrepreneurial attitude and invite innovation. In the age of the 4th Industrial Revolution, or the automation of the 3rd digital revolution, we are seeing new workflows that would bring about new methods of optimizing workflows and people processes.

Decentralized governance, and DAOs, are merely a construct of alternative economic models. As such, the real fear from people is whether a new paradigm will flourish. Holacracy didn’t flourish across every corporate landscape (yet) but elements of it have been widely adopted across every organization.

For example, the idea of an intrapraneur (or the entrepreneur that works in a corporate job), is a concept that shares holacratic principles by embracing creative and collaborative thinking across different departments.

Decentralized governances main antagonist is people’s rejection of something foreign and non-traditional. Decentralized governance places accountability on a community and less so on an individual making it hard for regulatory bodies to hold one single entity accountable. This is an existential cultural shift. 

Andrey Sergeenkov: To what extent do you personally believe in the future of DeFi? And what role in it will be dedicated to Hypergraph Transfer Protocol?

Ben Jorgensen: I believe that DeFi is an excellent use case of decentralized governance and how distributed systems and blockchain technology can revolutionize the financial industry. The financial industry has been drastically centralized for thousands of years and it makes sense that a decentralized technology, in the 4th Industrial Revolution, would find a path to flourish with DeFi and cryptocurrency.

The Hypergraph Transfer Protocol is the technology, community, and vision that will enable the revolution to flourish and succeed around these centralized systems and industries. It provides the capabilities, passion, and logistics needed to accelerate the revolution.

Across every revolution is a means to communicate. The Hypergraph Transfer Protocol is a communications protocol for the digital era and 4th Industrial revolution.  

Andrey Sergeenkov: What are the main benefits of HGTP protocol, and how does it match the idea of decentralized transformation as well as non-governmental control?

Ben Jorgensen: Without going into too much technical jargon, the Hypergraph Transfer Protocol (HGTP) is a communications protocol very similar to HTTP and the internet. However, the benefits are that it was built for securely transferring information across devices, servers, systems (infrastructure), to protect the data that we use and create at scale.

Our current systems and internet do not have security built at the core and have created so many breaches to our personal data and identity and the information we share digitally. The idea around activating a decentralized network means that security is at the core of the formation and proliferation of the network.

Today, applications are used using remote servers governed by the tech elite with security and accountability as an afterthought.

The Hypergraph Network will allow for secure and seamless communication between applications without the intermediary of the tech elite - this is democratization of data. 

Andrey Sergeenkov: How will the development process of decentralized apps change with HGTP, in comparison to building on Ethereum smart contracts?

Ben Jorgensen: Technically speaking, our micro-service ecosystem are essentially state channels that developers will spin up to add peer to peer communication, with robust permissions and capabilities, that will securely oracalize data.

What this means is that developers that build data pipelines for data collection (to be used in communications, connecting to other software applications (with machine learning being the most complex) will be able to build data pipelines that are more secure, have altering and auditing capabilities, and are governed by a democratic network (immutability at the core).

Right now, blockchain technology that exists today, do not have the capability to oracalize or measure the versacity of data creation and organization of data.

Thus mainstream developers and applications are not equipping blockchain technology (consensus mechanisms and immutability) early in the development life cycles. They just won’t scale to meet the frameworks of existing programming languages and digital infrastructures. 

Andrey Sergeenkov: What other benefits will the users get from using it - especially the ones who are new to technology and haven't explored its impact?

Ben Jorgensen: The DeFi space has rapidly come into existence with a lot of expectations placed on it. I would say there is more greed being introduced into crypto than actual technology and a vision. In the 2017/2018 ICO craze there was greed but it was circumvented into visions of alternative protocols.

Protocols and the infrastructure layer was the prize. Then in 2019 the space floundered a bit looking to invest in layer 2 solutions and applications (but with little fundamentals) because many of the protocols failed to succeed - it was just too challenging. The DeFi space slowly emerged out of 2019 and has shown a viable application layer solutions that have immediate demand from people that make up the crypto ecosystem; conversely the success of the protocol was only as good as business adopting protocol standards. As such, there are a lot of great DeFi products out there. I don’t really see a lot of DeFi companies, but instead products and solutions. This isn’t a bad thing at all - building a brand is tough. 

Lattice is emerging to take advantage of some of the solutions that are out there in DeFi. Automated Market Making (AMM) Algorithms , smart routing, and aggregating liquidity pools are several of the high level features and functionalities of Lattice that we are going to highlight on this base Layer 2 application that will be built on Constellation’s Hypergraph protocol.

One of our main goals will be to provide cross-chain orders by introducing BTC and DAG. This will be a huge shift as no one has done this in the DeFi space because it is rather complicated. In order to have a decentralized cross-chain order, you need to have a node that notarizes both sides of the transaction (example: BTC to DAG) on the respective chains. This requires a more robust protocol and consensus mechanism than what the competing chains can provide. A Constellation node, using the HGTP, will be oracalizing the state of the network before and after the swap on multiple chains.

We recently Airdropped LTX (an ERC-20 Token) to DAG holders to show our current capability to do cross-chain compatibility. Once you have cross-chain capabilities with different protocols, you can start exploring the evolution of trading tools (like Stop Limit Orders) and truly evolve the DeFi space to capture some of the market of the $30T Traditional Securities market by offering decentralized and democratic trading tools. 

Andrey Sergeenkov: In your opinion, will a lot of people be interested in applying the Hypergraph Transfer Protocol to their everyday operations? What about Lattice Exchange?

Ben Jorgensen: When the internet made its emergence, there were few visionaries and capitalists that saw the vision of where the internet could go. A majority of the applications built on the internet protocol were basic websites that many major brands and corporations just saw as a digital footprint. My first startup was an online video platform called OhSo.TV.

I built this in 2007 and our focus was on creating original production content online. When I went to Hollywood to sell this to agents and production houses, I was told “the internet is a fad”. I actually had one of the largest talent agencies in the world tell me they had some intern working on the digital front.

Now, Netflix runs the show.

Times have changed. Right now people are still understanding how to incorporate blockchain technology into their existing applications and unfortunately, the major protocols out there today are rather simplistic and aren’t garnering investment from developers because they won’t integrate into existing infrastructure.

2020 was the year that forced everyone digital in some capacity (Zoom meetings, online food orders, fitness, shopping, entertainment). This is causing an abundance of data being created and shared unknowingly between different organizations, companies, and individuals. HGTP was created to allow developers to build technology and applications with security in the forefront - accountability in the forefont.

While Constellation talks a lot about working with the Federal Government, securing space satellites, autonomous vehicles, and smart cities, these are merely the future state and scale of where this technology can go.

A lot of what we work on day-to-day are the smaller applications and quick wins: tax reporting, sending data more securely over unsecured and public networks, immutability of data, and securing existing data pipelines/feeds. There are an infinite amount of use cases for everyday use of HGTP.

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