Interview with Mr. Thomas Wiesner, Blockchain-Expert-cum-Trainer, Austria. We discuss the challenges and opportunities on the blockchain skillsets, resources, talent pool, etc. He further shares his views on various hacking attempts happened at crypto exchanges and how to fix them etc.
Kabilan: Welcome to another exciting episode of Wimplo news. Today we have a very special guest with us. Mr. Thomas Wiesner was going to be sharing a lot of important information about the security concerns associated with blockchain and cryptocurrency. So without any further ado, let’s go forward with this interview.
00:42 Kabilan: So Mr. Thomas, greetings, welcome to Wimplo news. I hope you’re having a wonderful day. So, to begin with, could you please introduce about yourself and how you got involved with blockchain and your journey so far?
01:00 Thomas Weisner: Absolutely. So, my name is Thomas. I’m the founder of thinking assets.com and we provide blockchain education. I started my journey in 2012, where bitcoin really took off a little bit. But at that time I was not invested in Bitcoin. My former employee tried to pay me, but I was a student and desperately needed the cash money. So no crypto portfolio, not got rich. Fast forward in 2016, I became aware of a platform called the ethereum and smart contracts. So I found it extremely interesting because with this smart contracts, you can, put business models of corporations onto the blockchain and make use of all the great benefits of the blockchain has at the very little cost. So this is where I was really stuck with blockchain and they tried to educate people all around the globe about blockchain ecologies and it’s been a great pleasure so far. It’s been a lot of fun.
02:06 Kabilan: Amazing. That’s very insightful. Thank you for sharing that. So to get started, so you seem to be teaching at Udemy. So what exactly is the profile of most of the students, who subscribe to the program? What’s the background like?
02:28 Thomas: So, myself and Ravindra we are teaching on Udemy, um, about blockchain technologies, mostly developing courses, hands on. Um, it’s also the largest audience we serve there with about 120,000 students. And those are mostly self-taught people who want to advance in their career or start a new career. So it’s less corporate training. It’s less team training that we see there. It’s people who come here really want to learn about blockchain technologies themselves and then either apply, which just put it as a new entry on their CV, which is a very good thing to do. It’s actually interesting because the second largest audience that we have is from India, so I think there’s a huge demand there.
03:23 Kabilan: I feel that blockchain has become, uh, a big thing here in India. A lot of people are curious to know more about it and this seems to be a lot of startups focused primarily on implementing blockchain technology to solve a lot of problems. So, I guess the future has in store for all of us.
03:43 Thomas: Yeah, I think so too. I think it’s a, it’s been a great journey so far, and the thing is we just still early adopters.
03:52 Kabilan: That’s wonderful. So, onto the next question. Can you name some key corporate training assignments that you have with some of the top blockchain companies?
04:04 Thomas: So first of all, the way we are doing corporate training with corporations is different than we do it with Udemy and Udemy, you have this video on demand courses, self-thought where you work for a project. And with corporations, you have more classic corporate in-person training where we go onsite and between smaller teams in groups. And we really tried to tailor it towards their business needs. What we do there, we have assignments which range from architecturing business workflows to implementing infrastructure layers and try to provide them the knowledge that they have the right governance in place. We also tried to answer fundamental questions like, how the can use a transactional data where we have payments and merge this together with operational data where it comes to supply chains or inventory control or fraud management. So those are, those fundamental things we try to answer in those labs and those assignments. And we run these labs with different corporations or even universities now, everything from very small ones to fortune 500 or even governments. And, I think the most interesting thing is that it was always eye-opening what you can actually do with blockchains outside of cryptocurrency. So that has been a lot of fun and it was always well received.
05:38 Kabilan: So the next question is about, Mt. Gox. So, for all the viewers who are unaware of this, Mt.Gox was one of the leading bitcoin exchange platforms from Tokyo, Japan. And in February 2014, the platform lost over 800,000 bitcoins amounting to more than $450 million. So ever since this incident happened, and I believe, the blockchain community of the cryptocurrency market has never been the same. So since this incident, how far do you think the community has evolved, uh, regarding the security of digital tokens? What’s your opinion on this?
06:26 Thomas: I think who was running Mt.Gox at that time were the super early adopters providing an exchange for cryptocurrencies. And I think there were no standard procedures in place at the time. I’ve never used Mt Gox myself, so I cannot really comment on how the user experience was or how they perceived security was on that side. But I know a lot of people who lost a lot of money on the exchange, and I think they’re going to pay out soon maybe. If, there are bankruptcy claims are going through. I believe that, through those mistakes that happened in the past, a lot of people learn from it. Both people who want to run the exchanges, as well as regulators who want to regulate and test and see that people can trust in the money that they put onto those exchanges.
If you run an exchange, you have to have risk management in place. You have to be prepared that somebody drains funds and you have to have a plan and mitigation plan for that in place. You can either go bankrupt or you can come out even stronger. I mean, it’s not the best example, but I think Bitfinex came out much stronger after their hack, where they issued their own coin and just get people hooked up as an investment into their own exchange in their own platform. So I think, I hope the community evolved and learned a lot and I think regulators, uh, necessarily stepping in and saying like, hey guys, there’s millions of people’s money involved, let’s do this right. And then do it at all.
08:18 Kabilan: I feel that there’s a lot of learning, there’s a lot of experience for the blockchain technology exchange platforms that will come out the future. And, I believe it’s been a huge learning experience to a lot of people. Unfortunately, some of them have actually lost a certain bit of funds to the incident, but like any other industry, I think it just goes through the ups and downs. And so this being said, my next question is also about another scandal that has happened recently. It’s about the QuadrigaCX exchange incident. So in your opinion, how do you think these exchanges can prepare fully to address the safety of investors? Is there a certain approach that these exchange platforms can put in place?
09:20 Thomas: I also have not used Quadriga Exchange. But from what I read and from what I see, I think the governance and management of Quadriga exchange were handled really poorly. Um, the way I am the student is like a running a bank and only the bank manager owns the key to the vault or even verse. And then he goes missing. And all the money’s gone. That definitely should not happen from a general standpoint, there are some basic disciplines that you have to have in place in order to run a company successfully. That is something that risk management, how you handle the money, fiscal and asset management, legal and compliance. And in that case also governance and management of the platform and investors money. You can’t just put everything onto the bank owners hands and think that everything will be fine.
So there are these basic rules to follow and in Quadriga exchanges a place, this was clearly not the case. The other thing which I think is lacking in the market is education and people do not get the idea right that strong cryptography and with the benefits and drawbacks of strong cryptography, there is no lost password functionality. If you lose your keys, you lose access to your funds. It can be the biggest benefit or in that case, the biggest drawback. So you have to have some management in place to avoid losing your funds, especially when it’s not yours but your investors.
11:00 Kabilan: I think that’s pretty fair. Thank you for answering that clearly for us. So there has been an increasing number of thick wallet apps recently on Google Play Store and a lot of people have actually been falling prey to these scandals and these fake applications. So according to you, what could be the measures that users or investors could take from falling prey to such breaches?
11:38 Thomas: In one word, I think it’s education. If you think about it, we are at the brink of a new area. We have normally we have banks issuing credit cards or bank accounts and now you’re issuing it to yourself and that happens with those wallets. And if you don’t know how this actually works, then you can fall prey to such breaches. It’s totally new and it needs some education. It actually reminds me very much of the early days where people bought phones on eBay and then they’ve got bricks instead. So it took some time in order that the market catches up, that people learned from it. They were educating themselves where to look for the right things in order that this can or should not happen. And at the end, I think that the benefits will outnumber the drawbacks I hope nobody will talk about the, a few people trying to make it quick money, uh, providing these fake wallet apps and I think there will be some standard applications that can come out as things that you will use. It’s almost like email if you think of email, you receive phishing emails and spam emails, but you would, it would just see that as a bad side effect. It’s not the main drawback of using email these days that there’s fishing.
13:02 Kabilan: I think the lack of education is one of the major reasons for all of this and since we are also on, technological transition, I believe this kind of things happen with the beginning of the Internet. And, since we are looking into a new transition now these things are bound to happen, but obviously, it does not overshadow the benefits and the value that it would add to everyone’s life in the near future. So I think that’s something that we going to start adapting to and getting more of it.
So my next question, uh, if you don’t mind is can data science concepts like deep packet sniffing used to prevent security compromises and if so, why do you feel that?
13:55 Thomas: It’s a good question. I can’t give you a 100% correct answer on that. I believe my background is artificial intelligence and machine learning and blockchain development. I think to answer that question a hundred percent correct, you would need to talk to someone with a strong network security background. But as far as I know, deep packet sniffing or is also called deep packet inspection. I think it is looking if a package,a metric pack contains a virus or something malicious on the protocol level and my thought on that is that it can prevent all security compromise as you can compromise security on many different levels. On the other hand, if you look at the blockchain where data inherently isn’t trusted and every transaction and every single block has to prove itself over and over again before it’s added as a valid block, it might even make a deep packet inspection completely obsolete. So that’s maybe just without even thinking what deep packet inspection does, maybe it’s not even necessary to think about it.
15:11 Kabilan: Thank you for your valuable insights. I think that could be helpful to some of our viewers. So moving onto the next question. How prevent the 51% attack, like the ones that happened to Coinbase? What would you recommend to curb such compromises?
15:33 Thomas: Well on public networks, we have proof of work in place, it comes down to the hash rate of the network. And when the hash rate of the network outnumbers, the financial abilities of an attacker, then 51% should not happen. I think you’re talking about the 51% of the tag of ethereum classic, right?
So what, what I saw with Ethereum classic is that the hash rate deteriorated over time. I feel it was considerably low so that an attacker could go ahead and buy a lot of hash rate, but the money he had to invest into buying this hash rate he gained it back by running the attack successfully. So, I believe that either you have a lot of hash rate, but I think in the long run, switching to other consensus algorithms like proof of stake or either other ones, the problem will go away and early there’s not a question anymore if it’s a 51% attack or if it’s even possible. And the thing that’s maybe worth mentioning, if they’re running these corporate training events, then we are not talking about 51% attacks because in corporate blockchains, in consortium blockchains, you have just a finite set of minors and you cannot just run a 51% the attack at all. It’s just not there. So these are problems of public blockchains with proof of work.
17:12 Kabilan: Thank you for sharing your insights on this. So the next question is more general, and I think it’s something that a lot of people are actually questioning these days. So in your opinion, do you believe that ICOs have a future and, uh, how do you think they’re doing against the emerging STOs?
17:37 Thomas: I believe that ICOs are an interesting business model for utility tokens. Unfortunately, a majority of investors and issuers of these are actually issuing a or after security tokens and there are not utility tokens. There’s only a minority of tokens which are really counting as utility tokens. And that’s as we see it now with the SEC going after all of these ICOs that the majority of them are not following with the SEC offering it as a test to find out if your token is utility token or a security token. The one token where I believe it’s a real ICO, real utility token is Filecoin where you can use the coin later to buy storage. So, as long as you follow this guideline that you’re token is a utility token. I think ICOs have a future.
But I also think that STOs are the one great way to provide securities of all kinds of through blockchain technologies. And I think this will be an extremely large wave of mainstream blockchain usage. There are advantages such as reduced cost or global and instant and secure settlement. And that’s just incredible if you think about it. Normally use a broker and then all of this goes away with all the intermediaries. Obviously, you need to have some funds in crypto and not in fiat money to make use of that. But that’s another story.
19:18 Kabilan: Thank you for actually giving a very insightful answer because I truly believe that some of our viewers would really benefit from that, in terms of how they go forward with ICOs. Thank you for that. And this brings me down to the final question. Most of the bankers are those who seem to be in power inside the centralized systems are against crypto claiming cryptocurrency leads to money laundering. What’s your view on this?
19:59 Thomas: I think the stigma is terrible and I think that cryptocurrencies have proven to be far more useful than harmful. I also think that blockchains or most major cryptocurrencies are actually a goldmine for governments, auditors and any law enforcement agencies. I do believe that most blockchains are operating completely open and publicly. And I also do believe that most criminals are somewhere down the road making a mistake so that you can trace them and track them down, which means money laundering a blockchain is a very bad idea, but I think the problem comes from somewhere else. I also think that blockchain technologies are very often confused or put equal to cryptocurrencies where I think that blockchains itself, they have a way to transform the way we handle data between multiple parties and cryptocurrency is just one use case and I think it’s not necessarily the best one. So when you ask me how to transform a banker’s mind to uh, put away this argument of money laundering, I would say you tell them about the cost reduction and the increase of benefits using blockchain technologies and suddenly it will not be a question anymore.
21:37 Kabilan: I think I agree with you on that. It’s more about the benefits that it does add and obviously, there is some stigma around it, but I hope that in the near future with the increasing advantages and benefits, all of this would change. And I’m so thank you for your answers.
So, on behalf of our team and all our viewers at Wimplo, I would like to extend a very heartfelt thank you for sharing your valuable insights and your feedback, your experience in this field, to help millions of people in helping to shape the world tomorrow and make it a better place and for this we are really thankful and, we would love to connect with you again in the near future. So, from everyone here at Wimplo, a very big thank you to you and the best of luck.