E-Commerce carries with it the convenience of purchasing goods without having to look for a parking space, stand awkwardly in queues that snake around the corner only find that the item one intended to purchase went out of stock about twelve customers ago, or even leave the house for that matter. Electronic shopping giants like eBay, Amazon, and Alibaba collectively hold a large share of the market at present, However, they also hold an ocean of sensitive customer data.
The data in question are held on archaic database systems that are vulnerable to cyber attacks, putting the financial wellbeing of many of us at risk of malicious exposure. Enter Safex, a blockchain project aimed at decentralizing e-commerce based trade in order to secure user information through encryption mechanisms typical of the technology. Safex’s plan is to facilitate peer-to-peer trade on a secure blockchain platform, allowing for a more inclusive and secure marketplace. The peer-to-peer trade platform comes complete with a cryptocurrency based trade ecosystem.
The Safex team released their bluepaper on the January 3, 2019, detailing a two token ecosystem where the first, Safex Token (with a total supply of 2,147,483,647 tokens minted on the Bitcoin blockchain till the Safex chain goes live) will serve as a means of payment for use of system utilities, namely: setting up accounts on the network, and earning incentives for network participation (as Gas does on the NEO network). The second token, Safex Cash, will serve as the network’s currency, to be used in transactions.
Daniel Dabek, founder and lead developer of the marketplace platform, is an experienced blockchain developer, having spent time on the team behind the MaidSafe digital asset project. We caught up with Mr. Dabek – who brims with enthusiasm about the revolutionary project – and quizzed him about some of the more technical aspects of the project and the problems the problem hopes to solve:
LLP: There are a number of anonymity coins springing up these days, what sets Safex apart from the crowd?
Daniel Dabek: The thing is that in the early days of privacy blockchain systems, most were launched without consideration for the future. They are pre-mined or have very steep emission curves where the people from half of a decade ago have siphoned off all of the supply, and there is very little fun left for anyone else. Also, for example, Zcash has a 25% tax on mining which is quite illogical for a decentralized cryptocurrency, and at best has presented an interesting twist on issuing privacy for transactions on the blockchain.
Safex, on the other hand, has a full-time economist who worked in the offices of a national bank. We analyzed the adoption issue and we are seeing the effects of currency distribution that compliments the life cycle of software and community growth.
Besides the basic requirements to maintain the anonymity of transactions which protects people from being targeted for their balance: we have the marketplace application baked into the blockchain. This means that a use case is present on the spot: the ability to buy and sell products directly over the blockchain in a decentralized manner.
LLP: How did your experience as a member of the MaidSafe project influence your approach to the Safex endeavor?
DD: I admire the steadfastness of David Irvine. He is working at the same concept for more than a decade and that is something to admire. MaidSafe has a fairly open environment and since all software is generated in public it exposed me to the way an open source software company and community can work together towards a common goal.
While originally we wanted to use MaidSafe’s network as the backend for the marketplace application, at the time of the discovery of Safex and the decentralized marketplace concept there were two options to build on: Ethereum or MaidSafe, the two largest platform plays in 2014. I kept a good eye on Ethereum, but MaidSafe has a more compelling concept since with cryptocurrency the privacy aspects are so critical.
We are discussing the future of the most fluid funds that have ever been imagined: and that for humanity means that we can progress so much faster than we ever could have without a blockchain system clearing all the transactions.
These deep issues are so thoroughly discussed due to the amazing community out there on the internet that is completely sorting out this perfect system. And it is going to become achieved, a system that preserves your data in plain sight yet only you can access it and decipher the contents. This is powerful. We have this in Safex – we can send fungible money and clear receipts over its blockchain.
I gained discipline and principles that make the Safex community resilient and sustainable technologically.
LLP: What role do you believe, anonymity tokens like Safex could play in the decentralized future? How could citizens of a small nation like Liberland leverage Safex’s anonymity component to their benefit?
DD: We believe that e-commerce is the most compelling aspect of cryptocurrency.
By virtue of being the crypto nation, the principles of liberland and Safex go hand in hand. Safex is a decentralized community in cyberspace destined to deploy a decentralized marketplace for anyone to be able to cheaply tap into the flow of e-commerce on a global scale. Liberland is fostering the same environment in governance.
LLP: What made you opt for a two token system instead of using a single token to perform a wide array of functions?
DD: The origins of the Safex project was a crowdsale in 2015 where 99% of 2.147 billion Safex tokens were distributed. During that time the project raised $50,000 approximately 150 bitcoins at the time.
This established a community that is collectively interested in fostering the establishment of a decentralized marketplace.
From the very start, the intention was to build the marketplace into a platform such as MaidSafe or Ethereum even though in the end we built our own platform. We did that because we can not be at the mercy of the whims of other projects and the intentions and path of other blockchains are not the same so Safex needed a sovereign blockchain.
Since we launched a sovereign blockchain we needed to add a currency to it, since a token sold all at once can not make good currency. So we developed a currency with advice from a top economist to address the problem of currency issuance versus the rate of adoption of technology. So in Safex Cash it is not distributed only largely to the early minority, but it is distributed over time increasingly as is expected the adoption of the technology. This way the environment stays competitive.
The Safex Token earns collectively from a 5% fee charged from completed sales on the marketplace application on the Safex blockchain. The Safex Cash is a perfect cryptocurrency distributed through proof-of-work mining.
The reason that proof-of-work mining is so significant is that it has a limitation in the physical world. So no one person can take over the network perfectly without occupying every square meter of the earth. Unlike with masternodes, which only require some person to own a big amount of the token. That is why we chose proof of work to secure the consensus of the blockchain and to distribute the currency.
LLP: With the blockchain world working to move away from the Proof Of Work consensus mechanism, what benefits does it hold over more lightweight algorithms, such as IOTA’s or Proof of Stake, and how will it benefit users of the Safex blockchain over other consensus mechanisms?
DD: As mentioned previously, proof of work has a limitation with heat dissipation, square meters required to hold the machinery. So there is a limit in physical space how far someone can go with attacking a network. However, with masternodes you depend entirely on the individual who holds the token. What if a private key critical was lost, and now the majority is someone incompetent or malicious. There is no salvation, so proof of stake is an interesting experiment, and in my experience can only be used in “semi-centralized” environments like private companies and countries. Though if it is about a public decentralized network then ideally it is proof of work driven.
LLP: Will the required staking fees adjust to accommodate growth in Safex token’s dollar value or will they remain constant through the network’s lifespan?
DD: The minimum Safex Token can adjust over time, though I believe it will be something small such as 1,000 or 5,000 tokens in such a way even when they reach a price of $1 a 1,000 or 5,000 commitment is acceptable until such a time that we increase the scalability of the blockchain in such a way that it remains decentralized yet can accommodate more transaction process per second to house so many revenue seekers.
LLP: The Safex marketplace is an ingenious way to streamline the adoption of cryptocurrency payments in the marketplace, how would a Liberlandian grocery store go about using the system to sell goods? Will the system offer integration into webstore and brick-and-mortar shop payment systems?
DD: I have a vision for a physical card, that we can use at the point of sales terminal, view the transaction and sign off on it there and the payment is in Safex, or Liberland merits for example. On such a wallet you have only your carry around funds. It is no different than a credit card and its chip has the signing authority for some amount of your funds.
A Liberland grocery store would update its inventory from the admin panel, and the stock in the store deducts from the inventory on the Safex blockchain as it is purchased.
This is as much about e-commerce as it is physical, though in today’s day even groceries are bought online.
Daniel attended the Malta Blockchain Summit at the end of May where he unveiled the system’s Test Net, featuring an updated wallet system among other improvements. In a video interview with crypto blogger, Altcoin Sara (filmed during the event), Daniel Dabek stated that they have the September-October preholiday period targeted for launch.
The Safex marketplace could become the backbone of Liberlandian peer-to-peer trade, given the nation’s embrace of decentralized technology. Safex, no doubt, offers the security that Liberlandian citizens – and people the world over – are entitled to in the digital age.