ICO Review: Emotiq

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This review is for a project that appears promising in my mind. It’s a bit early to review it due to the fact the team is still sorting out how it’s going to reach a more public audience. For now it’s in private sale with no plans for a public Token Generation Event (TGE). Their website is also outdated so I stitch a bunch of information I was able to gather for this review. I will obviously need to issue an update as I receive final details from the team.

Emotiq calls itself a next-generation blockchain with powerful scalability and privacy, combining the latest research in distributed ledger technology with an innovative natural-language approach to smart contracts. Rather than targeting the programmers who already know smart contract languages such as Solidity (based on JavaScript), Emotiq focuses on bringing in the larger audience of people who program out of necessity. That’s a lot to take in there so I’ll break down each of the buzzwords as it will be relevant to where it fits amongst the other blockchain projects out there.

Scalable: blockchains are notoriously slow, projects must make tradeoffs between decentralization, scalability, and consistency

Privacy: public blockchains put all transactions and data plain to see, privacy projects such as Zcash and Monero make it possible to transact discretely

Natural-language: Emotiq aims to bring non-programmers to develop smart contracts with a simple to read and write language called Ring

Smart contracts: most blockchains today feature this capability but as a refresher, smart contracts are essentially computer programs that execute transactions when trigger conditions are met.

Before going into a deep dive into Emotiq’s anticipated features let’s take a look at the team and the token sale.



Team

This team is loaded with technical talent proficient primarily in developing applications in Common Lisp. I’m not sure what the rocket scientist does for the team but that’s cool.

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Joel Reymont, CEO: 25 years of programming experience in a variety of languages including Erlang, Golang, and C++. His career experience screams versatility as to the type of applications he has built including iOS and Android applications to server side applications. Most recently he was CTO of another prominent crypto project, Aeternity.

Vladimir Lebedev, VP Engineering: resume reads of a serial entrepreneur focused on bringing his technical skillset to the team. Although he held high positions in each of these companies he did not stay very long. Likely, he either came in on an interim basis to push through critical projects or left shortly for shinier, newer projects.

David McClain, Chief Rocket Scientist: Honestly I do not really understand what his role on the team is aside from the mantle of “possibly smartest guy on the team, and smart guys make crypto projects look good”. I kid, but not really. Apparently David is an expert in LISP programming (30 years experience). His LinkedIn is bare bones. I would advise the team to have every team member build a robust profile.

Shannon Spires, Systems Engineer: Expert Lisp programmer with 25 years of experience at the Sandia National Laboratories where he built software to process greenhouse gases data and to control electric grid systems. Wow that is unconventional. He is currently CTO at Ampliltude Energy Anayltics while working on Emotiq – which I’m unclear is a small company or Shannon’s individual consulting firm. I’ll keep digging.

Paul Tarvydas, Electronics and Microprocessor Guru: was a Senior Director of Software Development for 25 years. In his own words he has delivered a wide range of applications ranging from small embedded hardware systems to large-scale financial applications

Mark David, Software Architect: 35 years as a Lisp programmer. Working full time at Emotiq.

Mark Evensen, Software Architect: 25 years of experience with Common Lisp, Python, Java, or C.



Token Sale

This data is from the best of my knowledge.

  • Ticker: EMTQ
  • Standard: Own standard, not an ERC20
  • Private sale only, no public sale
    • Potential for bounty and airdrops to reach a public audience
  • Eligible investors: $100,000 minimum and net worth of at least $5M
  • Hard cap: $39,000,000 (this is confirmed via Telegram but website shows $60,000,000)
  • Price per token: $0.13 per token
  • Total supply: 1,000,000,000


Features of Emotiq

Natural language

Emotiq will feature a language called Ring, built on Lisp. Why Lisp or Ring when many programmers know other languages? Why introduce an oddity? CEO Joel Reymont brings up Paul Graham’s post Beating the Averages as a reason why Lisp is the primary language of choice for Emotiq. An excerpt:

Our secret weapon was similar. We wrote our software in a weird AI language, with a bizarre syntax full of parentheses. For years it had annoyed me to hear Lisp described that way. But now it worked to our advantage. In business, there is nothing more valuable than a technical advantage your competitors don’t understand. In business, as in war, surprise is worth as much as force.

Graham was alluding to Lisp’s ability to rapidly develop applications and features. He used a language that was popular in universities and research labs in a competitive environment to deploy large scale applications to the web. When his competitors differentiated themselves with new features, Graham would simply whip up the features in short order. The competitive advantage of first mover eroded.

The same argument could be made for the decentralized web to come. Using a language that could be picked up by competent but not necessarily trained programmers could be an entryway to mass adoption/creation of smart contracts. Ring is meant for non-programmers to hop on the blockchain train. Not only will Emotiq run Ring based smart contracts, but Solidity programmers can develop on Emotiq as well since Ring’s Virtual Machine also processes Solidity.

OmniLedger and Horizontal Sharding

Emotiq will use horizontal scaling (similar to Zilliqa and Quarkchain) to enable higher throughput. As a quick reminder, horizontal scaling is increasing network capacity by adding more machines. Vertical scaling on the other hand focuses on upgrading the existing nodes on the network. Bitcoin, for example, scales vertically as dedicated mining machines are built to run its Proof-of-Work algorithm. Emotiq will enable sharding built on top of OmniLedger. If you’re not familiar with OmniLedger, let’s discuss its goals and the properties inherited to Emotiq:

  1. Full decentralisation, no trusted third parties nor single points of failure
  2. Shard robustness – network is partitioned into multiple shards processing in parallel, each shard will continuously process transactions assigned to it
  3. Safe, secure atomic transactions – transactions within and across shards
  4. Linear scalability – network scales as more nodes are added
  5. Low storage overhead  – validators only store necessary overhead needed to run the network
  6. Low latency for transaction confirmations

UTXO model (similar to Bitcoin) and PoS as consensus

OmniLedger uses UTXO as its accounting model, so to does Emotiq. Here is a great blog entry explaining UTXO. Blockchains have several choices when it comes to its accounting of the distributed ledger. The two popular choices are UTXO (Bitcoin) and the Account (Ethereum) method. In the UTXO model, when a transaction is created, a UTXO is created (sender spends a previously unspent amount) and another UTXO is spent (recipient receives funds that have not been spent).Through this system, adding all UTXOs will calculate the accounting state of every account on the network. When UTXOs are created they are randomly assigned to shards. Due to this randomization, Emotiq will need to be able to process transactions atomically across shards. Assuming Emotiq uses the same UTXO model in OmniLedger, a Byzantine Shard Atomic Commit Protocol called Atomix enables cross shard transactions.

Scaling through ledger pruning

Blockchains such as Bitcoin burden nodes in the network by having them download the entire ledger. Payment networks such as Visa produce well over 150 GB per day. For new validators joining the network, this overhead presents a hurdle in hardware requirements (storage space) and network participation latency (software requires syncing the entire distributed ledger). Emotiq will do this by building upon MimbleWimble. Emotiq plans to maintain the history by using an ordered Merkle tree, and puts the Merkle tree’s root hash in the header. Network validators will then run consensus on this check point. If approved, this new block becomes the genesis block.

Verifiable Random Functions (VRF) used to select Leader nodes

To ensure security of the network, the process of selecting the next block validator must be difficult to produce but easy to verify. With VRFs, a specific seed value combined with the creator’s secret key will produce a resulting psuedo-random value. Network validators can then verify the new leader by combining the same seed value combined with the creator’s public key (not private key). Other projects using VRFs in their leader node selection are Ontology (link to my review) and Dfinity.

Oracles

Smart Contracts are executable programs that make a decision, yes or no. In order for these Smart Contracts to make a decision they often require information from the outside world. Oracles can be defined as trusted data sources that feed information into the smart contract. This reduces the workload for the smart contract as it does not need to add in additional capabilities to seek external information, but simply focusing on fulfilling the contract’s condition(s). The irony of relying on “trusted data sources” should not be lost upon proponents of decentralization. But at the same time, to increase enterprise adoption of blockchain it is necessary to work existing data lakes. Company APIs interacting with Emotiq’s Smart Contract capabilities is essential to bridging the decentralized and centralized systems gap.

Proof of Stake

Emotiq’s network features a Proof of Stake consensus mechanism. Their whitepaper is vague around these details so unfortunately I do not have much to add.

Bulletproofs

Emotiq will use non-interactive zero-knowledge proofs, otherwise known as Bulletproofs. Bulletproofs have the benefit of providing speed and scalability over existing privacy solutions such as zkSNARKS, which requires heavy cryptographic operations.



Concerns

No project is perfect so I’m going to lay out my concerns in detail.

Dedicated team members

Dedication of the team to the project is very important to me when it comes to evaluating a project’s prospects. Working full time indicates that the team is going to eat, sleep, and breathe the success of Emotiq. Without knowing the full extent of token metrics it’s hard to say what the financial motivations of the team members will be. Also, many of the team members have had a long history of software contracting or short stints at firms. While having a large number of software experiences is beneficial for, well, software development it also puts into question whether the team is in it for the long term.

Website is out of date

On their website their hard cap is stated as $60M but when you visit their Telegram their hard cap is $39M. Also, Emotiq’s sale is only for accredited investors at this time. Investor minimums are $100,000 and require a network of $5M.

Public distribution to be defined

This may not be a fair criticism given they are still working things out. My ICO rankings tend to favor projects with broader public distribution so unfortunately this project is going to suffer in one of my core metrics. However, this shouldn’t take away from the team’s ability to deliver on what appears to be a promising project. If I was to advise Emotiq I would suggest either a bounty program or an Airdrop to distribute tokens to a more public audience. Edenchain is one example of a project that not only canceled pools (to avoid legal scrutiny), but also generated a highly successful viral campaign through its bounty program. Overall, Edenchain was successful in generating buzz and onboarding a number of new token holders in exchange for their “sweaty equity”. The point is, Edenchain spent very little OpEx on marketing.

DisclaimerI participated in the Edenchain bounty program

Programmers may not like natural languages

There are more popular languages used in software development than Lisp. Also, Lisp has been around for a very long time. Many new languages have since come on the scene. For this reason, many programmers I’ve chatted with will dismiss using natural languages and Lisp, there are simply other languages to use. Personally, as a businessman focused on data driven decision making I use Python every day. It shortcuts my workload tremendously while at the same time enabling me to move beyond off the shelf software tools such as Excel or Salesforce reporting. With my own personal bias for Python aside, one could simply argue that the team created a blockchain ecosystem on Lisp because they are all proficient in that language regardless of how many others use it. Adoption may be a very serious issue.

 

Hard cap

The team plans to raise $39M, down from the website’s stated $60M. This is a fairly steep hard cap. Personally I’d like to see concrete plans for a Foundation to reinvest in winning over developers to the platform if you’re going to raise this much.



Pros

Emotiq will be one of the first OmniLedger public deployments, along with another highly rated upcoming project – Harmony. I had not heard of OmniLedger until recently but will definitely keep probing. The team is highly capable with their technical talents. Once Emotiq settles their affairs with respect to their public distribution, updating their content (website, whitepaper, a more detailed yellowpaper), and once they complete their code bases for sharding and oracles this project is going to be a formidable competitor in the blockchain 3.0/4.0 space.

The elephant in the room revolves around yet another smart contract enabled, sharding, and privacy blockchain. What makes this better than Zilliqa? What makes this better than Zcash or upcoming Starkware enabled projects? The technical answers to those questions are beyond my capability to respond but this team can win on the ground in several other ways. It could focus on building a foundation similar to Ethereum, Neo, and Dash to help foster the network’s development and outreach. It could also develop strong developer networks in poaching Ethereum/Solidity smart contract developers to migrate or second source their base layer protocol on Emotiq. The Foundation could also invest as a VC or hold bounties for programmers to continually build around the clock on the network: making it more robust and capable.

As a business person who happens to program in Python, I can appreciate Emotiq’s approach in bringing in non-programmers to embrace the smart contract world. There are far more non-developers then there are programmers. I can foresee a wysiwyg-like or HTML-like interface for non-technical audiences to build their very own smart contracts. Each of these smart contracts would have different functionality, perhaps it’s a parent releasing allowance funds when their child receives an excellent grade, or a trustee releasing funds when the trust’s conditions are met and need to be executed. The possibilities for drawing in the public is hugely appealing in my mind.



Verdict

With the ambitious roadmap ahead of the project one would question the team’s ability to execute. For me personally, I’m excited about this project despite all of the concerns I laid above. Many of the projects I reviewed did not nearly have the level of talent as this team. Despite focusing on what appears to be an “old” computer programming language, it’s possible for the team to position adoption with the right initiatives in place. Pouring over their GitHub you see the incredible number of commits and level of development. If I had the opportunity, I would take a small chance here.



Source:

  1. Beating the averages, Paul Graham
  2. OmniLedger
  3. What is a UTXO, and how does it work for a blockchain ledger?, Earlz.net
  4. How Oracles connect Smart Contracts to the real world, J Slobodník
  5. What is zk-SNARKs? An Introduction to this Privacy Protocol, Blockonomi


Quantalysus publishes blockchain research and analysis for the crypto community. Please follow on TwitterSteem (please follow and upvote if you can – thanks!)Telegram channel (New!), and Medium to stay up to date.

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