When Chris Trew founded blockchain development platform Stratis in 2016, only a handful of players were touting for business in the fledgling ‘enterprise blockchain’ space. But a lot can happen in five years.
Mohnish Pabrai On Investing In A Pandemic And Buy And Buy Hold
In May, the value investor Mohnish Pabrai took part in a Q&A session with the Kolkata Value Hunters Club. The value investor spent the first part of the session discussing how his strategy had developed over the past 12 to 24 months. In particular, he spends more time focusing on high-quality companies with strong managers Read More
Today, the global Blockchain-as-a-Service (BaaS) market is worth over $2 billion, with experts predicting it will reach $15.8 billion in the next five years. Other sectors of the cryptoconomy have also flourished, from decentralized finance (DeFi) and digital art to centralized exchanges and custody solutions.
Simplifying Blockchain for Enterprise
A developer by training, Trew wasn’t exactly bright-eyed and bushy-tailed when he launched Stratis: he’d been consulting to enterprises for three years by then, had voraciously digested the Ethereum and Bitcoin whitepapers, and identified the potential for distributed ledger technology (DLT) to improve organizations’ operational efficiency and drive revenue.
The problem, as he saw it, was that businesses weren’t ready to jump into blockchain with both feet: the learning curve was steep, the outlay high, the prospect altogether too daunting. Enter Stratis, an enterprise-grade platform that offered cloud-based, end-to-end solutions using mainstream coding languages. Despite assurances that Stratis could remove the complexity of blockchain while helping clients leverage its potential, Trew and his colleagues had their work cut convincing clients to sign up. So what changed?
“The world was a very different place back in 2016,” Trew acknowledges with a laugh, “and understanding has increased a lot. Back then, the question was really whether blockchain would be suitable for enterprise use cases and would adoption come? Now, the question is: ‘Are there any areas of enterprise that won’t be touched by blockchain?’”
Adoption has certainly come a long way – and that’s as true of enterprise blockchain as cryptocurrency. In 2016, asking a stranger if they possessed any Bitcoin might provoke a look of bewilderment; now they’re as likely to shrug and say they prefer ETH.
“Stratis was always designed to make blockchain easy to integrate to existing environments, we’re the only platform built in the popular C# language, so more than a million developers can work with the platform,” says Trew.
“One area that has seen rising adoption of late is supply chain optimisation, where blockchain allows data to be securely shared between different organisations. For example, Stratis is to be used by Gluon, a US company that automatically registers fuel usage at gas stations so that fuel deliveries can be more intelligently ordered. This use case connects several organisations involved in the gas supply chain, and there are plans to initially roll the capability out at more than 100 gas stations across the US.”
Supply chains have long been earmarked for a blockchain upgrade, and many organizations have experimented with the technology over the years, using it to hit sustainability targets, ensure proof of provenance, and enhance cargo tracking and traceability. According to IBM, blockchain tech in the supply chain could save the logistics industry a whopping $38 billion a year. But Stratis is exploring other industries, too.
“Another hot area is video gaming, where blockchain is being integrated so that games can have their own economies – and digital items like swords or shields within a game can be ‘owned’ by players,” says Trew.
“By registering ownership using Non-Fungible Tokens (NFTs), game developers unlock real-world value for players as these items can be traded on secondary markets. This transformation makes games more popular, rewards players, and it’s one of the most exciting applications of blockchain today.”
From DeFi to Gamefi
The explosion of interest in crypto-powered gaming has attracted huge amounts of capital to the industry, with TRON founder Justin Sun recently launching a $300 million fund to bootstrap play-to-earn protocols. Dubbed gamefi, the concept combines elements of decentralized finance (liquidity pools, yield farms, etc) with traditional gameplay, giving gamers the opportunity to earn passive income in cryptocurrency simply for having fun.
“I think this gamefi is one of the most significant trends in blockchain,” Trew enthuses. “You only need to look at Axie Infinity, which is played by thousands of people in order to earn income that’s comparable to a salary in some parts of the world. The network effects are huge and blockchain is an enabler of that; Axie is tracking $200 million in real-world revenue each month, it’s a brilliant business.”
Trew has a professional interest in gamefi, too: Stratis recently introduced cross-chain functionality supporting defi and also has a software development kit (SDK) for Unity, a developing platform for creating 2D and 3D games. The latter tie-in makes it simple for video game developers to bake blockchain use cases into their games.
“There are around 20 exciting proposals for new applications being built on Stratis right now including those related to NFTs, defi and gaming,” Trew reveals.
“This positions us well for growth, and whilst Ethereum has been hugely successful, that success means network fees remain stubbornly high. Stratis offers similar functionality with far lower transaction fees. It’s my job to make sure our infrastructure continues to deliver for defi and gamefi developers.”
NFTs Land on Stratis
NFTs, of course, have been crypto’s runaway success story in 2021. Earlier this year, digital artist Beeple sold an NFT collage for $69 million, becoming the world’s third most valuable living artist, behind David Hockney and Jeff Koons. NFT-based dApp NBA Top Shot, which allows users to buy, collect, and trade ‘packets’ of NBA players and iconic moments, has also racked up over $700 million in sales since launching last year. Whatever way you slice it, NFTs are hot commodities – a fact not lost on the Stratis boss, with the platform soon to release its own nonprofit NFT marketplace.
“The ability to make a digital item scarce through provable ownership by an individual is transformational,” he says. “NFTs help content creators get more fairly rewarded for their work and they also make new types of digital economy viable, like the in-game economies in gamefi. There’s no way that genie is going back in the bottle.
“Our own NFT marketplace on Stratis is feeless, we don’t take any transactional revenue from artists or creators. Our strategy is to focus on emerging and breakthrough talent that may otherwise enter into non-preferential agreements with large companies. NFTs give them a way to show their value.”
Speaking of cryptographic tokens, Stratis, in common with many blockchain platforms, features its own native asset (STRAX), not to mention its own liquidity pool. “Holding STRAX means you can run a smart contract on Stratis, or create your own sidechain for specific uses, or simply send tokens to other people,” Trew explains.
“With the upcoming launch of our decentralized exchange Opdex, we will gradually see more defi applications built on Stratis – and even more utility for STRAX.”
The Blockchain Energy Debate
Unless you’ve been living under a rock, you’ve probably heard lots about Bitcoin’s energy footprint in the past six months. The furore even caused Elon Musk to roll back his decision to let customers buy Tesla vehicles using the asset. Although disparate blockchains use different consensus mechanisms and unique energy matrices, the debate made critics take a closer look at blockchains – and the power required to run them. What did Trew make of it all?
“Well, there aren’t many chains using proof-of-work today – Bitcoin is an exception. In its defence, proof-of-work offers undeniably strong security and a large percentage of miners are actively collaborating to use green energy sources to power Bitcoin, so progress is being made.
“Personally, I still feel Bitcoin is the most secure network and will remain the most dominant one for years to come. Major work is ongoing to improve its scalability and introduce new features like defi – the future is bright.”
And what about Stratis’ own energy footprint – is it something clients worry about?
“We were actually one of the first blockchains to adopt a proof-of-stake model, which means our technology has always been highly energy-efficient,” he smiles.
Between NFTs, DEXs, gamefi and its core BaaS businesses, Stratis is fighting fires on numerous fronts. But speaking to Trew, one senses it’s all just part of the plan – the core mission hasn’t changed. “We’ll continue to build out secure blockchain infrastructure that’s simple for a wide range of developers to use,” he says with evident relish. In an increasingly crowded field, Stratis seems destined to hold its own.