Hey crypto enthusiasts! Welcome back to the Altcoin News Podcast, for each and every one of you tuning in to support us on motivation to keep featuring amazing and potentially disruptive projects.
So be sure to like and subscribe if you find this video useful. This podcast series is meant to enlighten you with inside knowledge and expert opinion from professionals and blockchain pioneers.
*Before we get in, I do have to point out our disclaimer. All information presented in this series is meant for educational purposes only. Please do your own due diligence, if you plan on moving in capital into any of the projects that we cover, your money shouldn't be dictated by anyone, ever. With that out of the way, please enjoy our podcast.
In today's episode, our featured project is the Qredo Network. In short, Qredo has designed an infrastructure known as the Consensus-driven, Multi-party Computation Protocol that aims to bring a solution to decentralized custody matters and to bring on institutional-grade security to DeFi.
To further elaborate on the concept, we brought on the COO of Qredo to help us understand what they're working on, and how potentially disruptive the technology behind Qredo can be to the status
quo of blockchain. Joining us today is Josh Goodbody. The Chief Operation Officer of Qredo network. Without further ado, let's jump in.
Q: Hi, Josh. Thanks for coming in. To kick this off, why don't you tell us a little bit about yourself? How did you get your blockchain? And what's your role in Qredo?
A: Thanks, Peter. Yeah. Thank you for having us. Great to be here. So I am the COO, as you mentioned, of Qredo. My role is to help the team scale the company, really bring out key products and services, and get us moving in the right direction. And my background is originally financial markets and derivatives laws, but most of my career on the sell-side working with various investment banks, various training houses, to help them figure out the right way to trade the derivatives markets or trade the financial markets.
Did that for about 10 years and I saw the kind of gleaming fintech sector, and I thought fintech is definitely interesting. It's related to financial markets. It's related to banking. It's related to upcoming technology. And I thought let's give this a go. So I moved into fintech in 2016, 2015, and started really getting to grips with some of the emerging technologies that were coming out in finance. And I had a few general counsel roles in the space. And then I actually saw crypto, you know, 2017, crypto was booming in many cases, the price was dropping rapidly and this thing captured me. And I thought, well, this is a really fast pace and slightly crazy space. But it is seemingly the future, so for me being able to work at the cutting edge, really led me to join Huobi in 2018.
So I joined Huobi's Global General Counsel, helping them internationalize the business. And I ended up leading their institutional business after a year. So I was with them for 2 years. And after that, I was with the Binance group for a year and a half, leading Europe, the Middle East, and Africa region for them. So it's been worldwide. I feel like I've been in crypto all of my career, but it's actually only been since 2017.
Q: That's actually quite interesting. It definitely sounds like you have a lot of experience with centralized exchanges. So, tell us what attracted you to Qredo in the first place.
A: Yeah, that's a great question. So being exchanges, you kind of get to see the immediate growing pains that come with scaling a business in crypto and you see all of the growing pains and teething pains that our customers and users feel whether it's security issues, scalability issues with the technology they're using, delays in layer 1 blockchains. And it gave you an example of one stage at the end of the year. So it was quite a volatile bit of the market. I was at a large exchange and we were paying millions of dollars a day in Ethereum gas fees. You realize very quickly that's not sustainable and there has to be a better way, scalability, security, and speed have to be found in other solutions, not just the layer 1 assets.
And so when I first met the Qredo team, they were looking to build this decentralized custody and settlement network. And it was really ambitious. It was cross-chain by design. It was highly scalable. This was even before they started building. And so when they pitch this vision, I thought this is really ambitious. This is very forward-looking. And if they do pull this off, if they manage to build this, it would be pretty transformational, once widely adopted. Watching the team move through all these various milestones. And I was advising them for a period of time throughout that period. To see them really execute at speed and deliver all of these quite complex milestones that they've achieved made it quite clear for me that this industry needs infrastructure. It needs it really badly and not any old infrastructure. It needs cross-chain to operable infrastructure that brings platforms and blockchains together in one place to hold assets and settle assets.
And really in the Qredo Network, that's what I saw very early. So bringing this fundamentally radical technology that is completely blockchain agnostic to the industry that isn't charging fees and doesn't have a contract or anything like that when you onboard onto the platform that doesn't lock you into satellite contracts, believing in open networks and open systems in the principles of an open ecosystem. That kind of philosophy really ran true with me.
And so for me, it was actually a pretty easy decision. Exchanges are really fast-paced, and they've got a lot going on. And you're really at the cutting edge of building products and services for the retail user and it's fascinating. But in Qredo, I saw the opportunity to work for every single segment of the market. Infrastructure applies for everyone. And that's what's so exciting about it. The potential is so large.
Q: I understand that one of the co-founders and also Chief Technology and Product Officer of Qredo is a cypherpunk with extensive development experience working with major tech giants stretching years and years back. And not to mention Qredo CEO was a founder of multiple successful tech companies, with a few even listed on NASDAQ. It certainly seems like the team has a strong foundation in both tech and finance. Can you tell us a bit more about the backgrounds and why they have decided to shift the focus on the blockchain?
A: Yeah, so Brian Spector is one of the co-founders. He is, as you said, you described him more, it's better than I could. Yeah, he's got a long pedigree in technology. He was in crypto before cryptocurrency existed. He was a cryptographer by trade. He was in the first wave of cryptography. And he has been in this space for a long time, having seen the good, the bad, the ugly. And in his previous company MIRACL, which was a zero-knowledge proof, ID authentication platform. They were building and scaling in an industry that really benefited from cryptography.
And so he's seen how powerful cryptography can be in certain industries and applying the principles of that, but making sure that it's kind of open source and an open network is really his kind of priority. So he saw the opportunity in crypto to really fix the custody problem. Custody has developed in crypto as a movement to silo assets in different places. Nothing speaks to each other. Nothing is interoperable. Everyone's charging huge fees to hold assets in different places. So his eureka moment was: what if I can decentralize custody? And I can put custody and all the security that comes with that onto the blockchain without compromising security. So making custody on the blockchain more secure than cold wallet custody. That was his aim. And so taking all the cryptographic background he has and all the knowledge of how to do it and scale it from his previous career. Brian has excelled himself and he walks the talk. He believes in open networks and systems, and he's the contributor and sponsor of something called the Apache Milagro Foundation, which is essentially an open-source software project, which is within something called the Apache Software Foundation. So we pledge all of our code, all of the intellectual property that we create. We put that into the Apache Foundation. And that means that we guarantee that the Qredo Network is always gonna be open and available to everyone in the future. It's not gonna be siloed off and held in private intellectual property repositories. That's one of the key entrepies that Brian wants to pass on from building this - the fact that it remained open and free for everyone.
So Brian's technical expertise is the driving force behind everything we do in Qredo. And Anthony Foy, our CEO and also a co-founder, is really an entrepreneur that has got a long pedigree in history and taking frontier technology, scaling it, commercializing it. He's worked in various sectors from cloud computing through to Legal Tech, through to Red Tech. And for him, when he met Brian, in Brian's previous company MIRACL, he actually was trying to acquire Brian's company. That's how they first met.
Now the deal didn't happen, but they remained really good friends. And when Brian brought this idea that he had, this kind of crazy idea of decentralizing custody to Anthony, it was a no-brainer for him. He saw the scale of and size of the market, the total addressable marketing crypto. It's just vast. And if Brian could pull off this achievement of building decentralized custody and settlement, then the total addressable market for Qredo would be huge. And so Anthony and Brian are a bit of a dream team in building and shaping really complex projects. So for me, it was a real pleasure joining the team and getting the work hands-on with them, and really seeing what they've achieved. So we are really fortunate to have some key talents in leadership positions in the company. And it gives us a bit of an advantage in building and shaping products quickly because we have all done that in our respective jobs in previous industries.
So in that respect, I think it's a bit of a superpower that we have a team that has done this before in different industries, but in fact, has even worked together in some previous roles. So Brian has brought a lot of the cryptographic team from his previous company together here, so they all had worked together, they know how to shape things quickly. It's been a real pleasure to see the team come together and really tackle some really really complex cryptographic problems.
Q: It suddenly sounds like you guys have assembled the 18. Aside from the coefficient, the team really is the most important aspect of launching a successful initiative. Speaking of coefficients, let's talk about Qredo's sophisticated slogan: The Network Is the Vault. Who came up with that? And can you elaborate on the idea behind the slogan?
A: Yeah, absolutely. The Network Is the Vault. I think it was a bit of an eureka moment for someone in the team because in trying to explain what we do in Qredo, it can get complex. You can get bogged down in some of the technical jargon. You can start really explaining the underlying technology and you can miss the overall theme of what it is that we're doing.
And that's taking custody and settlement and keeping it on a layer 2 network. Instead of trusting a custodian, instead of trusting a settlement solution, provided by one party that operates all the technology themselves, instead of trusting them, trust the network. And if you trust the network, the network then becomes the vault. Your custodian is no longer the single counterparty
that just holds everything for you. You can trust the vault. So the network becomes the vault. And what we mean by that is we have, essentially, we've built and launched a decentralized multi-party computation, secured custodial and settlement layer 2 network.
Now that's a bit of a mouthful. But the layer 2 network that we have built, which is built on a fork of tenement acts as the layer 1 asset, tracking an ownership record keeper, but not only that, it gives people the ability to put governance around how they hold those layer 1 assets in the network. And that's because the layer 2 network invokes multi-party computations. So it feels and it looks when you're using the Qredo network and Qredo account, it feels like a multi-sec account. You can put multiple approvals in the chain. You can add various different roles to people as a signer or as an observer. But it's all underpinned by MPC, so this layer 2 network Qredo chain that we've built is the glue that brings all of these different functions together.
Q: As I understand it, MPC was originally a cryptographic theory. Can you walk us through how the Qredo Network puts the MPC or multi-party computation protocol theory into practice? To explain this to someone who doesn't have a tech background, how will transactions operate? What is the significance of the system? And why does it have so much potential?
A: So MPC, multi-party computation, is probably one of the biggest breakthroughs in cryptography in the past couple of years, and MPC's been around in different forms.
But really, what we have done is try to take MPC to its next level, push the boundaries of MPC's functionality. And in a nutshell, multi-party computation is a cryptographic protocol that distributes computation across different parties. So no individual party can see the other party's data. They all work together to solve a computational problem. What we have done in the Qredo Network is we've implemented what we believe to be the next generation of multi-party computation.
So in first-generation MPC deployments, you would typically see these private keys shodded. And 1/2 would be kept with the client, you, the user, and the other half would be kept with the service provider. So you got two shots of this private key. If you think about that, there is still a risk, and there are 2 pieces of really important information that have been broken up and stored in two different places. And they have to come together to sign a transaction that the first generation of MPC presents the risk. You've got a trust that you hold your shot and your service provider holds the other shot. I can look after that shot that nothing is gonna happen. Their systems aren't gonna be compromised. They're not gonna find a way to abstract that will find a vulnerability that they can leverage. In our version of MPC, we take counterparty
risk out of it. We operate something called a trustless consensus-based protocol.
This is why we say it's the next generation of MPC, because there aren't any private keys. So it feels like magic when you're using it that there are no private keys and there are no shots of private keys as well.
The way that we do this is we have two classes of MPC nodes within the network. We've got something called a client and a network MPC node, the client MPC nodes hold what's called secrets within a hardware secure module. This hardware device that sits within, for example, AWS micro, which is a type of AWS deployment and all the secrets that you put into the client MPC node never leave the hardware. They don't get exposed to the wider network. They sit within this hardware device. Then these secrets that sit there are then decrypted by the network MPC nodes. And through decrypting these secrets, a public transaction can be signed. So essentially, we put all of the magic of MPC onto a network. We remove the vulnerabilities that come with having one party being the sole operator of all of the MPC nodes. And that's why it's trustless, and that's why it's consensus-based. And an additional bit of security that we've added into this is because this all operates by a layer 2 network, which is a blockchain, all the ownership rights of crypto assets are held on that blockchain. So you've got this immutable record on the blockchain of who owns, what, who, where.
But in the first-generation MPC deployment, all those ownership rights are held in a database like SQL database that can be held in cloud deployment or hardware devices. We've really tried to strip out all of these vulnerabilities that exist from first-generation models of custodial and settlement technology, and make it as trustless, make it as secure as possible. And our version of MPC really gets us as close to that as possible.
Q: How will Qredo's decentralized solution to the centralized custodial ownership problem be mutually beneficial to centralized exchanges? And half-jokingly asking, will you guys be a potential threat to CEXs?
A: Interesting question. Well, to answer the question, no. You know, the benefit of decentralized exchanges is they are experts at what they do. They operate a high-speed matching engine, they've got clubs, they bring buyers and sellers together in milliseconds and provide an environment of deep liquidity with an order book, that's visible and all of the technology that comes with that. So exchanges will always be fundamental parts of the ecosystem.
Now, when we come in and work really closely with exchanges, it is around the technology of custody and settlement. Now think about it. Now you trade on a centralized exchange. You've always got to move your assets onto that exchange. You basically got a pre-fund every single trade. Now, up until Qredo came onto the market, there was no other solution for this. You had some solutions that offered some kind of credit. So people could trade on credit. They could delay settlement for a couple of hours. But really what, if we think about that model is really just moving risk from one place to another place. What we've done is we've been able to demonstrate that you can integrate a decentralized self-custodial wallet.
So if Peter is a user and you set up a Qredo wallet, you can take that wallet and have that integrated with a centralized exchange. We're going live with a couple of very large exchanges in the coming months. And that self-custodial wallet you have complete control over. You can also add an exchange as essentially a participant in that wallet. And what that means is you can keep your assets in your self-custodial wallet. You can trade and open positions on decentralized exchanges. But the exchanges know that at all times they have the right to sweep assets out of that wallet when they need them. So if your position gets liquidated, for example, they can sweep assets out of the wallet. Now they can't sweep anything else out. They can't take your funds. But if you've got an open exposure, you've got a position, you built trade. You can essentially give the exchange the right to take the assets that are due and payable to it. We've demonstrated to a number of exchanges that you can have a centralized exchange working beautifully with a self-custodial, decentralized wallet. That's adding huge value to exchanges, because you can essentially take the risk that sits with exchanges, which is holding people's assets.
And you can abstract that and remove that as a material risk. We're running a lot of value in that respect to exchanges. And they're really seeing the Qredo Network and the Qredo wallets as something that is just a really interesting option for them in terms of infrastructure. In addition to that, they're looking at the Qredo Network as a great way to settle transactions. Instead of moving Ethereum from the exchange wallet to a user's wallet via the Ethereum blockchain and paying huge gas fees and sometimes the delays that come with that, you can settle and move assets over a Qredo's layer 2 network instantly without paying any reeve, any material fees.
There's a lot of value that we're gonna be adding to the centralized exchange space. We're gonna be doing a lot of kinds of education and publicity building around that. To try and demonstrate the case the Qredo wallet and the Qredo Network add a lot of values to both the user as well as the exchange.
Q: What incentivizes users to participate in the Qredo Network, particularly institutional professionals. And how does the governance structure work in practice? Can you show us more details surrounding the tokenomics of Qredo?
A: Yeah sure. We recently released the Qredo token. We did our first secondary market listing on Gate, which was a good success. The Qredo token for us is a bit like the fuel for the Qredo ecosystem. It accesses the primary reward mechanism for activity on the network.
And the Qredo token at a very high level is a utility in governance. Token allows people to participate in the network, so to earn the yield and benefits that come with holding a Qredo token. But also, it allows them to stake their assets and share in the rewards the validators get. So we've built in multiple incentive mechanisms to essentially incentivize people to use the network, to settle transactions, to provide liquidity.
But then also, when validators start operating on the network and spin up a validator to know they earn their rewards in Qredo tokens. And this provides a really powerful kind of incentive mechanism for them, because they get their awards in Qredo tokens. They also can hold the Qredo tokens and stake them to get even more rewards within the network. So the Qredo token is kind of the fuel for the ecosystem. It really is a powerful mechanism for gaining rewards in the Qredo Network. And in the future, it will be highly usable as a governance mechanism. You'll be using the Qredo Network and to vote on governance protocols. We want to really move the Qredo Network to be as decentralized and autonomous as possible. By that I mean moving it under the control and governance of DAO
. The Qredo token is gonna be the key fuel within that will enable people to have influence in the governance of the overall protocol.
In that respect, it's a really interesting mix of incentives, rewards, governance, and utility. And we've learned the lessons from layer 1 and layer 2 assets that really only incentivize validators. We've built a token that tries to incentivize all parties. And that's because we realized that everyone has a role within the ecosystem. The token has got to reward everyone as equally as possible, but also as aggressively as possible to move as much activity onto the network.
Q: To conclude our podcast, what's the roadmap ahead for Qredo moving forward?
A: Absolutely. Yeah. We have so much planned for Qredo. We're gonna be broadening out and listing on more and more venues over the course of the next couple of months. We're gonna be showcasing some really amazing partnerships over the next couple of weeks where we're bringing Bitcoin
infrastructure to financial institutions in Latin America, helping the Bitcoinization of some economies.
We're gonna be announcing partnerships with some of the largest DeFi players in the space, helping provide the custodial and settlement layer for them. And we're gonna be working with some of the largest exchanges to help fix some of the infrastructure problems that they have. So we have a lot planned. We're growing our community aggressively and we really want to hear from people on a day-to-day basis. So please connect with us on Telegram and Twitter. We'd love to hear from you.
Be sure to check the links in the de_script_ion below to follow Josh Goodbody and the Qredo Network on Twitter, Telegram, and Discord. On a side note, the Qredo token, $QRDO, has recently completed its private and public sale on CoinList, raising over $35 million USD. They also conducted a free IEO event which was heavily oversubscribed. If you're interested, the link is also down below. If you like this podcast, remember to smash that "Like" button. And please leave your comment to let us know which project is worth investigating. We do read your comments. That's all for today's podcast. See you all next time.
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