Conversation with Joseph Ferrara ‘19, Eric Hu ‘20, Brian Guo ‘19 about Cornell Blockchain

Why did you start the club and what made you interested in the industry?

Joseph Ferrara: I started learning about bitcoin and blockchain about a year and a half ago, and I got a buzz. I couldn’t stop learning about it. I started mining bitcoin, which wasn’t very efficient, but I started researching and talking to other people on campus about Bitcoin and blockchain; it just flew over their heads. In the end, I realized Cornell had IC3,  the biggest research organization blockchain in the world, but no one realized Cornell had that resource. We started coming up with the idea to get a club going to educate people on this new industry.

Eric Hu: I briefly learned about bitcoins in high school, and then last year my friend who goes to Berkeley got me immersed in it after telling me about the blockchain club, which is a really big student-run organization in blockchain space. I tried to look into why Bitcoin is valuable and how that applied to blockchain technology. I realized over the summer that was where my attention should be instead of where the prices were.

Could you describe, at a high level, what Bitcoins and blockchains are?

Joseph Ferrara: Blockchain is a way of taking any data or transactions and making it immutable and transparent so that you can look back on the data and know that they are real and verified without any human interaction or role in storing that data.

Eric Hu: It’s a glorified data storage system. The blockchain data structure is something that you’re beginning with, and you have many layers on top that can increase its abilities. Decentralization is the core.

What excites you about this industry and what do you see as the biggest challenges or risks?

Joseph Ferrara: The idea of having a democratic system of storing data has been around for some time, but Bitcoin was the first use case. Having an entity to interact with other people on a peer-to-peer basis has never been done on a large scale before. A new industry is branching off in which applications ranging from any industry, such as healthcare and Equifax, you can eliminate those kinds of issues. Blockchain can transform this idea of third-parties holding off data.

Eric Hu: The most interesting thing is it’s a technology that would revolutionize the way we see data. This is a more logical step of how we store data effectively which can be applied to any industry where a database is needed. It’s more secure and by far more effective and faster. The challenge is every time you have new space, most of the people don’t know what they are talking about so there are a lot of misconceptions out there. There’s no authority to separate the truth from false information. This leads to a lot of people who don’t understand the technology, and for people who do, it’s very difficult.

Joseph Ferrara:  The creation of the club is that real science and real education takes place, and that’s how you can be more educated and understand the technology.

What’s stopping some  of these industries from adopting this technology? Also, what examples do you have of people using it effectively right now?

Joseph Ferrara: The concept of blockchain data structures is not new, but companies are just beginning to understand it. We know that companies are interested in it, and they are trying to figure out ways to implement it to improve data security. IBM, for example, uses Stella Lumans to make transactions internationally and reduce fees that way. IBM is relying on a blockchain that they created recently, and they are trying to get government processes to use blockchain. JP Morgan also has a core blockchain network that they are using. It’s slow because it’s so new, and there’s a lack of supply of people who can develop something like this. As it becomes more well-known, people will get interested and use it, but as of right now, people don’t understand how to.

Eric Hu: We are currently in a hype phase about this technology, but it’s just an idea not a product. Companies are going to throw millions of dollars at it, but they are not going to succeed. There’s probably going to be a big change in the way companies try to race for it.

How do you guys see Bitcoins impacting the economy?

Joseph Ferrara: I would say the traditional investor doesn’t partake in bitcoin. The money is stored in a valueless data and no one knows what it is. The traditional Bitcoin person does not believe in traditional equities either, or investing/contributing. About the deflation aspect, that’s caused by a more recent trend in interests.

Every blockchain has its own rules but there are blockchains that do not have a finite amount that are being constantly created.

Brian Guo: I think also, the main thing about bitcoin and cryptocurrency is that you can buy very very small amounts, and when you have things like that, how much would it get traded would be in tiny increments; it wouldn’t really impact the deflation outcome.

Do you recommend people to invest in bitcoin?

Joseph Ferrara: I don’t want to provide any investing advice since it’s such a new market, but we are in a hype phase and this is when you should be cautious since you don’t know where the market is going to go.

Eric Hu: It’s also very similar to any stock, so you need to know where you are putting your money. If you do know the risk, and know the reason why this token has its value, make sure you choose a token that’s useful.

Joseph Ferrara: The standard rule about when you're investing is that Bitcoin has no real face behind it. When you're looking at actual companies launching ICOs,  look at the team, who is behind the team, what is their mission, what is their roadmap, what are their social media pages about. But if they're just focusing on the money aspect, then that is a sign not to go with that. You want to look at these aspects when investing. But definitely be cautious during this time.

Eric Hu: It is following this whole trend where if you have crowdfunding, there is this similar aspect where sometimes people are throwing money at nothing. I think with more regulation, things will become interesting but safer for the person who wants to invest. All I am saying is security is very important.. If people are choosing to, then they should understand how to do this.

So you mentioned regulation and ICOs… what is your view on the Chinese government banning the whole ICO idea?

Joseph Ferrara: I think governments are a little wary about this new technology, like where is the money flowing to, where is it coming from. I can't say for sure, but maybe China is trying to put a pause on it, understand it more, and see how they can implement correct procedures to progress. It is definitely always going to be around, this new type of market, but it is about how to regulate it in  a way where you can see where this money is coming from. It is going to be difficult, because like Bitcoin, it is not tied to any entity. I mean you can’t say Bitcoin will live on forever, but I'm saying that the idea of the way it is being built is that it can essentially go on forever.

Eric Hu: With China, it is an interesting case especially, it is expected.. A country that wants to control their monetary outflow is so important. In traditional investing, you can't bring money out of China. To think that they allowed Bitcoin trading and ICOs to occur for so long is pretty surprising in my opinion. I think they did the right thing, and I think because most ICOs are not very good, essentially most will fail and are somewhat scams, I think a pause on these ICOs until more regulation is in place is the right thing to do. In this whole Blockchain space, there are so many people who don’t know what they’re talking about and are just thinking about making quick money. People are putting a lot of money into this, for some reason, in things they don't understand, and that is very problematic, so I think the government is doing the right thing.

Could you guys talk about, for potential new members, what your club meetings look like, what you have to offer, and what your recruiting process is like?

Joseph Ferrara: At our most recent meeting, we had professor (Gun) Sirer come in and give a talk, which was really interesting.

Eric Hu: Professor Gun Sirer is an associate professor here in Computer Science, and he is the co-director of IC3, which is Cornell’s Blockchain research group. He is also our advisor. He is a very big, prominent person in the blockchain space. He has been studying decentralized systems for a long time, so to share his research and what IC3 was doing was incredible, because he is a very influential person in this space. Most meetings are essentially our education series. The main reason why we developed it is because, other than the fact that there was no credible source at Cornell specifically, the class closest to Blockchain is a 6000 level Computer Science course on cryptography. That is really not the best way, if you want people to learn. So our G-Body is pretty understandable; it’s not that technical. We kinda flip between non-technical type things, implications, markets, softer things, and then the technical aspects. Brian is our tech head who just understands the technology behind it.

Brian Guo: Yeah, understanding the protocol, what we are actually dealing with when we talk about Blockchain: how it works, how transactions are made, how they actually get sent out to the network, and how everyone agrees on the one state of the network.

Eric Hu: Yes, so that’s our general bodies. And then we have two branches from there: our tech branch and our business branch.

Brian Guo:  Right now we are doing first level recruiting for the tech branch; I actually just came from that.  We are recruiting people who don’t have to go through the education series right now because they already have done their own independent research and know enough about the Blockchain space to join the tech branch. They known enough about protocols and technical details of it. As for the tech branch, for this first semester, we are mostly focusing on helping out with the education slides in the technical sense, because the ideas every other week are focused on understanding Blockchain itself from a technical aspect. We’re also focused on working on creating workshops in order for people to get from the point at which they leave the general body, to the point that they want to be, in order to start developing with us. As a project, we are creating essentially an SVB client in Bitcoin implemented as a smart contract in ethereum.

Eric Hu: Essentially, they're converting an outdated language into a currently used language in Ethereum which is a very popular blockchain.

Brian Guo: Aside from Bitcoin, Ethereum is probably the second most popular blockchain, and we are essentially creating a client for Ethereum that functions as almost proof that you send the coin to a certain address.

How did you guys get up to speed with the industry, and what resources did you rely on?   For prospective members, what resources would you recommend and how do you advise them to start getting involved?

Eric Hu: It depends on how much you want to understand. If you really want to understand the technical side...

Brian Guo: Yeah, this is a question that gets asked to me at the end of my interviews a lot: how would you reccomend getting into this space? I always say that the one truth about what is actually happening is in things like the white papers for ethereum. That is the protocol, that is what people base their own development on. The white paper is the user-friendly version of the yellow paper which is the official protocol that includes all the off codes that you don’t really need to know.  But Ethereum has a whole Wikipedia section. There’s a great book called mastering Bitcoin that explains Bitcoin in a user-friendly way that's great for people to understand.

Eric Hu: If you’re looking more for what our business branch is focused on, which is blockchain  consulting, then like if you’re doing any finance internship, you want to keep up with the news. Coin telegraph, coin desk are things to understand what is happening in the first place, and keep up with markets. I think the most important thing with that is not just the news, but the implication of why they’re doing that. Why did china bankrupt their currencies and ICOs, and how does that play into the governmental role? For example, Russia is implementing the Crypto-Rupel. Is that Blockchain, is that not? It’s not, but that is a very good question. There are a lot of things that happen. Things link together, and if you look from a really macro perspective, there are huge trends, even in the last few months, about how things develop, and the news is the best way to get your information.

Joseph Ferrara:  On top of that, I think it's important if you're going to look into the business side of it, it's definitely important to understand what Blockchain is, but if you can just learn about it to the point where you can talk about it in a conversation, just like understanding the surface level of each aspect. You can go on Youtube and watch videos. If there is a term you don’t know, like what is a Merkle Root, you can look up: what is a Merkle Root? There will be be other terms when you research, and you just keep basing it off things you don’t know. It's like a domino effect, eventually things will start coming around the circle and you will start understanding it a little more. It’s not going to take a week but...

Brian Guo: I just wanted to add on to something Eric said: with sources like Coin telegraph, Coin Desk and things like that, take it with a grain of salt. Their intended audience is just the general audience, and sometimes they'll explain it in a way that’s intended for people to understand. The translation from how they explain it to how you understand it will not always be so accurate, and even how they explain it will not always be so accurate. There are actually a good number on Reddit that are part of the community that develops Bitcoin. For the technical side I would recommend going into what is called “The Gitter,” which is essentially a Slack channel. It functions exactly as a Slack channel as a byproduct of of GitHub as opposed to Slack, where a bunch of developers get together, and you can post any question on the chat, and something will get back to you with a response.

Eric Hu: We are in such an early stage that essentially any figure in the blockchain space… you probably will be able to talk to them, and that's actually incredible.

C : You’ll be able to meet them in real life. Like the creator of Etheron himself, I met him in real life. And a group of people came to the IC3 conference at Cornell, huge figures in the space, and they were all normal, casual people. That is the byproduct of the fact that we are just starting out in the space.

To wrap up, what do you guys hope to accomplish in this club? How do you see this playing out in the next year or two? If you have any comments about Cornell's involvement, and if  you think there are things the school should focus more on? You mentioned there is a lot of research going on so any views on that?

Joseph Ferrara: I definitely see this club going to the point where, hopefully, we will make it a one credit course… We are just starting off, so our lectures, we are always tweaking to make them adjust to the audience that we are working with. I don’t know, we are just rolling with the punches.

Eric Hu:We would like to get a one credit course, one, so that Cornell data science has that, and so that there is some recognition that this is a certification, to some extent would be incredibly beneficial, not just for us and our credibility but for the people who are learning it. So they can show on their resume to anyone in the field that I took this class. That definitely gives you a leg up over 99 percent of people in this space. We definitely want to do a hackathon of some sort. We are partnered with Blockchain at Berkeley on the West Coast, and also we are talking with Colombia Blockchain Labs and with the Blockchain Education network, which is a nonprofit. We are trying to develop this certification. For example, if you go into finance, you have to pass a bunch of tests before you can start trading. Similar thing, you have to pass some tests in order to show that you are competent in the space before you can interact. With the tech branch, we want to have a project team of some sort. With the business branch, we want to have a more established consulting structure. Right now, our clients are mostly sourced from startups we worked at, which is a pretty good deal flow, but we want bigger companies; we want to be recognized in the space. It is something that if your company had been audited, then your code has been security audited by Cornell Blockchain means something. Other than that, just making a community. It’s pretty cool.

Brian Guo: As a representative of the tech branch, my goal for Cornell Blockchain is to have a good set of projects where we can say that we were the first ones to think of this and implement this. To really establish our legitimacy. We caught onto this wave pretty quickly, and having the amount of resources we have, and all the established professors being at Cornell, it is a great advantage to us, really. It’s a great resource for us to have to be able to rely on them to help us out.