OKCoin's Xu Mingxing was interviewed by an economic magazine. Is Bitcoin and blockchain the next hot topic?

Seven years have passed, and Bitcoin is still running independently. Since 2015, the blockchain, which was once unknown and known as the underlying technology of Bitcoin, has frequently attracted the attention and exploration of global financial institutions and large companies.

R3 CEV, a startup founded in September 2015, initiated the R3 blockchain alliance, which has attracted the participation of nearly 50 banking giants including Citibank, Deutsche Bank, HSBC, Morgan Stanley, and Societe Generale, aiming to create a global decentralized, real-time clearing system.

Currently, most banks in many countries around the world still use the SWIFT system (bank settlement system) for cross-border remittances, which takes T+1 or even longer. Gong Ming, founder of the vertical media Blockchain Pencil, told the Economics reporter that blockchain technology can achieve real-time account arrival, greatly reduce inter-bank settlement costs, and effectively improve capital operation efficiency.

Due to the decentralized nature of blockchain technology, some people predict that it may replace intermediaries. Although SWIFT released a report saying that blockchain technology will not completely replace third-party institutions, it still feels the threat and expressed its willingness to embrace blockchain technology. It also released a blockchain technology application map.

Currently, the world's four largest accounting firms (PwC, KPMG, Deloitte, and Ernst & Young) are also exploring the application of blockchain technology in auditing. OKCoin founder and CEO Xu Mingxing believes that blockchain technology is suitable for auditing. Deloitte's business revenue in 2015 was $35.2 billion, so how can it be ignored? "If you can't resist it, you have to embrace it." In fact, many companies that embrace change have succeeded. For example, Tencent embraced WeChat, and Sina embraced Weibo.

In October 2015, The Economist stated that blockchain is a machine for creating trust.

The essence of blockchain is distributed ledger technology, and currently only Bitcoin is its most mature application.

Blockchain is also a database. The servers of traditional databases are centralized, while blockchain treats each computer as a server that stores complete backups. Bitcoin has been running for more than 7 years. It uses blockchain to record every Bitcoin transaction, and the total recording space is about 60G. Gong Ming believes that the storage cost of this amount of data was very expensive for many people ten years ago. "Nowadays, hard drives calculated in T have more than 100G of free capacity, which also gives blockchain technology a broad space for development."

If a centralized database or backup is "blown up", it is difficult to retrieve the lost data, but there is no need to worry about distributed ledgers. Therefore, security is another feature of blockchain technology.

But the real problem is that if anyone can keep accounts, how can we ensure that they are not maliciously tampered with? Xu Mingxing said that this is how to solve the problem of consistency in a distributed environment, which is the "Byzantine Generals Problem" in the field of mathematics. Many mathematicians have made many solutions. "Each solution has limitations, but it works in a certain field." Take the R3 blockchain alliance as an example. There are currently about 50 nodes. As long as the entry and exit thresholds of each node are raised, "when the cost of counterfeiting and profit cannot match, counterfeiting loses its meaning." Compared with Bitcoin, whose nodes are distributed all over the world, R3 is easier to solve this problem.

"The distributed storage of blockchain is safe, but it also brings new challenges, such as someone attacking the solution to the 'Byzantine Generals Problem'." Xu Mingxing believes that any technology has both pros and cons. "Does it have more positives than negatives in specific application scenarios? Can it make life more convenient and better?" are the key to judging the quality of a technology.

Startups based on Bitcoin

Blockchain may become the next "Internet" technology that changes the world. There are always people who firmly believe in it and spare no effort to promote it.

There are too many coincidences in starting a business. In 2012, Xu Mingxing left Docin.com and tried to seize the opportunity in the wave of change. He caught Bitcoin in the attempt from the hot O2O to P2P online lending industry. In 2013, less than three months after the OKCoin Bitcoin trading platform he created was launched, the price of Bitcoin soared from 1,000 yuan to more than 8,000 yuan. Then, as the price of Bitcoin plummeted, the bubble that was slowly filtered out made Xu Mingxing gradually realize that the blockchain technology behind Bitcoin may have a profound impact on the world.

How will blockchain technology be implemented?

European and American countries are the first to explore the application scenarios of blockchain, and the current exploration is concentrated in the financial field, such as settlement and clearing, payment, auditing, stock exchanges, digital currency, etc. Xu Mingxing believes that the reason why people give blockchain technology a high position is that it will have a profound impact on many aspects of the financial system. "It will not be realized immediately, just like the impact of Alibaba on physical stores, which took more than ten years."

However, domestic enterprises are not far behind. On July 29, Sunshine Insurance launched the "Blockchain + Aviation Accident Insurance Card". Recently, Ant Financial said it would use blockchain technology to track donations. "Blockchain technology can make the destination of charitable donations transparent and solve the trust problem in the public welfare industry." Xu Mingxing believes that blockchain technology will develop faster in "weak credit" industries or fields, such as P2P online lending, mutual aid platforms, clearing, notarization, and elections between international private institutions.

Although the application scenarios of blockchain technology are constantly expanding, its keyword is still exploration. Currently, domestic venture capital has begun to pay attention to blockchain-related startups, and many people have started businesses because of this. "Blockchain itself is just a technology, but it is regarded as a gimmick by many people," said Xu Mingxing. It is meaningless to hype gimmicks. The key lies in whether startups can solve real user needs.

OKCoin launched the first commercial blockchain technology application in China, OKLink. OKLink is a new generation of global value transmission network built on blockchain technology, dedicated to promoting global value transmission efficiency while improving global remittance user experience. OKLink connects small and medium-sized financial participants around the world, including banks, remittance companies, Internet financial payment platforms, etc., and uses blockchain technology to greatly improve the speed, cost, transparency and security of value transmission. The network has been joined by dozens of partners around the world, covering more than 20 countries and regions. From this point of view, blockchain technology has great potential.