Founder of Ontology, Jun LI

Recently, in an exclusive interview with Cointime, Jun LI, Founder of Ontology, shared his insights into public blockchains. Here is a summary of part of the interview.

You once said that in the future public blockchains will each have their own strong suits, and there will be 5 to 10 public blockchains taking up the majority of market share. When do you think this will happen?

Jun LI: For most people, they can hardly name more than 10 non-token public blockchains. Some of the public blockchains which started early are already the leaders in the industry, including Ethereum, Ontology, EOS, and TRON. These are all community-focused projects and are still at the stage of community growth, but this trend will not last. Most dApps today have a very short life cycle. The internet industry had countless applications at first, but in the end, only a few killer apps dominated the market. The blockchain industry will also follow this path, and in the future people will not care too much about how many dApps these public blockchains have.

What people should really care about is finding industries and dApps that can run for years and attract millions of users in the quest for real business applications.

As public blockchains, Ethereum and EOS are very much community-focused, which is all very well, but to realize real business applications they need a centralized force, a force not for control, but for promotion. It will be a long-term mechanism because establishing a partnership with enterprises is a long-term process as well. Once the partnership has been built, long-term support is even more important. For example, if something goes wrong with the infrastructure, prompt response within 24 hours is to be expected, which centralized forces can guarantee. At present, there are not many business-focused public blockchains in China, because doing so does not come with eye-catching headlines and is not as popular with communities. But I think this is something we should stick to, and is where Ontology’s unique chance lies in.

Most dApps on the top public blockchains today are games, and most of these games are for gambling, what can we do to break this cycle?

Jun LI: Ethereum had 4 to 5 thousand dApps, but EOS was able to surpass it in a couple of months, so there is no such thing as established advantages in the industry. The difference between the internet industry and the blockchain industry lies not in people’s ideas, but in the way and ability of communication. There are not many blockchain companies who know how to negotiate with traditional sectors. At present, this is a thankless task. For instance, our negotiation with many traditional companies lasted six months or even longer. It took one year of communication before we launched a simple loyalty point application for Fosun Group. I believe real business applications are going to require our long-term effort, but in the end, it would pay off.

You said that at the end of the day, the blockchain industry needs to empower the real economy. If this is a journey of 100 steps, how far have we traveled?

Jun LI: I would say five steps at most. If you have been to blockchain meetings a couple of times, you will find that you keep seeing the same people. I think we should try to explore new frontiers of blockchain, instead of competing with each other within the industry. The fact that public blockchains are still at the early stage is itself a blessing since there will be more opportunities for us.

Ontology provides integration of public and consortium blockchains. Most consortium blockchains today still have much room for improvement, and like you said, public blockchains are still at the early stage, so what’s the point of talking about the integration of public and consortium blockchains now?

Jun LI: Since we have developed both public and consortium blockchains, I feel we certainly have a say on this topic.

There is a myth among consortium blockchain and pure tech teams, saying that public blockchains are all about hype, and only consortium blockchains have real technology. I think this is a paradox since consortium blockchains are not open-sourced. I think technological development requires both time and money. Most consortium blockchain companies are not as rich as leading public blockchains. The reasons are simple, public blockchains manage tens of billions of assets and invest hundreds of millions in R&D every year, so it is quite impossible that consortium blockchains, which invest only a couple of millions a year, can overtake public blockchains in technology. Moreover, public blockchains which have reached a certain scale will find it easy to build consortium chains. Therefore, just like traditional IT systems, consortium chains will eventually be integrated into public chains.

I have been saying that public blockchains are not seeking to disrupt and replace everything with decentralization but to integrate the data sources of centralized and decentralized systems in a decentralized way.

The integration includes traditional IT systems. Say you have a private chain or consortium chain in your ERP system or CRM system, with public blockchains, these chains are able to communicate and verify each other. Therefore, if existing consortium chain groups want to scale up, one way is to turn themselves into public chains, which is not easy. If you want more people to operate and maintain your nodes and build your ecosystem, then you must make it worth their while. You cannot just give people money and ask them to do it. So, for consortium chains, a better way to do it is to integrate with public chains as “systems”, which will make them more trustworthy and allow them to collaborate with other consortium chains. In a nutshell, public blockchains will serve as an important bridge in the future.

Technology-wise, there are many companies who want to build consortium blockchains, but for them, the safest way might be to do it on well-developed public blockchain frameworks, such as Ontology. The reasons are twofold: first, these frameworks have been open-sourced long enough; second, they have proved their security and technology are reliable.

Could you give us some figures about the number of dApps and their users on Ontology?

Jun LI: At the moment, we have 20–30 dApps with more than 200,000 users. The number may not seem large at first glance, but it is because our focus has been on the long-term development and quality of individual dApps, not on the number of dApps. HyperDragons Go! is a case in point. The game was first launched on Ethereum and then introduced to Ontology’s platform. Thanks to our marketing and operational support, today the number of DAUs on Ontology is 10 times that of Ethereum. For public blockchains, what matters most is not the number of gaming dApps, but their long-term development. In Q2 and the second half of this year, we will launch some dApps for traditional industries with millions of users. For example, Fosun’s loyalty point dApp could have even 100 to 200 millions of tokens, but it will take time.

User base is very important for public blockchains and dApps, but currently user growth seems to be a big headache, as there are only so many users in the blockchain community. What do you think?

Jun LI: Take the loyalty point dApp. In the best case, loyalty points will be allowed to be converted and traded. Now users may not know what Bitcoin is, but if one day they suddenly find out loyalty points can be used to buy game items and converted to Bitcoin, for them it will be a new model of digital trade and investment, which can help convert a large number of potential users in traditional industries and enterprises into actual users. The first step is always the hardest, you need a good dApp to draw users, to begin with. That is why I decided to work with traditional sectors, which is also the best way to push back the frontiers of the blockchain industry.

Do you have a growth target for the number of dApps and users on Ontology?

Jun LI: I do not have a specific target, because it depends on how each dApp grows. Our initial plan is to launch 50 to 100 high-quality dApps this year. The number of users largely depends on popular dApps, a conservative estimate would be 1 to 2 million, and with the users from traditional industries participating, 5 million or even 10 million would not be impossible. At the end of the day, all will depend on the growth of each dApp. Our main task this year is to go on with our strategy for real businesses.

You can find the full interview in Chinese here.