Hey everyone, let's give a few more minutes for everyone to join and we'll begin.
Okay, might as well just go ahead and start.
So hi everyone, happy to be here. Hi Patrick, hi Jaden.
How are you? Hey, doing good. Great to be here. Great. So I suggest, yeah, before we start with
explaining about Jocko and Oz, let's give just a round of introductions first. So if you'd like,
Horace. So my name is Patrick, I'm the co-founder and CEO of Jocko Labs, where we built the Jocko
Protocol. We've been kind of working on this since 2022. And yeah, it's been a wild ride. I'll kind
of kick it over to Jaden. I'm Jaden, I'm the head of growth over here at Jocko Labs. So anything
business development, partnerships, etc, is my neck of the woods.
Great. Happy to have you here, guys. So yeah, I'm Metro, I'm part of the Nolos team. My role is
product development. So I joined Nolos around the beginning of 2022. And I'm usually working
closely with the developer team. I mostly take care of documentation as well, and
also the governance related things around the Nolos chain. So with that in mind, feel free to give
us a more detailed intro to Jocko, I guess. This is a protocol that I personally find quite
interesting and quite different to what we have in general in the Cosmos ecosystem. So be curious to
find out more about what you guys are building. Of course. So what Jocko is at the end of the day,
we started building a digital forensics tool, actually, believe it or not, and we ended up
building a public cloud environment. That being said, we kind of started before this kind of term
came around, but people like to refer to it as a decentralized physical infrastructure network.
And when we say that, essentially, what they mean is Jocko has number one, it has the blockchain
where they have the validators that kind of control who has access to what data, make sure your data
is always stored properly, manage permissions and privacy, and increase the cybersecurity posture
of the protocol in general, which is kind of unique because if you look at legacy
data storage systems in general, and even a lot of the Web3 data storage systems,
they don't really have a security posture where the end user in the private keys,
the only person has access to their data. That being said, the physical infrastructure
part of Jocko is the storage providers. So we have two peer to peer networks.
One is this validator set that kind of sets the rules and makes sure that no one
has access to data that they shouldn't have and make sure that the data is constantly stored.
And then the storage providers, their job is they're kind of like parking space for your data.
So they kind of eat data in and they put it to rest, it stays encrypted, so they can't
access your data because they don't have your private keys. But that's kind of how that works
at the end of the day. It's a system to have ridiculously high digital privacy and security
posture. But the other thing that's pretty fascinating in general, when you look at
blockchains and you look at kind of building infrastructure that's outside of like the
finance and governance and lending spaces, you have this unique ability to, number one,
have this high security posture. But number two, since we chose the Cosmos SDK as our tech stack,
we have this unique ability to deploy these things called outposts, where anyone on any
blockchain that's IBC connected can have access to data storage with a simple smart contract call.
So for users, that could be like a Dropbox, for example, where you kind of just have your
own personal cloud environment. But for developers, it's really important that they have large media
files that they have to store. So if it's NFTs, if it's documents, you want to peer-to-peer send
files to other people without middlemen, we unlock all kinds of unique use cases in blockchain.
And I'm sure I might be missing something such in. If I miss anything, let me know there,
but that's kind of the high level overview of what we do.
That was actually my next question, because I was curious to find out how exactly other
web trip protocols could leverage basically your storage providing solutions. So for NFTs,
I believe it's clear. So for example, NFT has the metadata to an image that could be stored
on Jacko, for example, for the storage providing network. But yeah, for DeFi projects in general,
that would be like I was thinking about some cool use cases which could be pretty much utilized.
So yeah, if you have anything in mind, or if you already have some partnerships with DeFi
protocols on that front, that would be cool to find out.
Of course. So with DeFi protocols, I mean, look at blockchains. They're just a fancy Excel
spreadsheet at the end of the day. We have this magic spreadsheet that's never wrong.
So when you want to do transactions with DeFi protocols, you pretty much submit it to the
chain itself, and the chain can store them because it's such small amount of data.
So with DeFi protocols, we don't usually kind of have integrations that way,
outside of a unique use case, where we talked with Jack yesterday from strange love, who's
working on an application called roll chance, which is interesting. But essentially, what you
could do is the entire Cosmos ecosystem relies on clickage use snapshots for for the blockchain,
and kind of having an ability for people to kind of get chain state, and have a backup of chain
state and have an easy way for people to access it. Kind of like a large scale data availability,
because there is data availability networks out there, but it's still like, kind of like one
megabyte of size, maybe a little bit more, you might be able to get to a gig. But when we're
talking about really large files and having that available, that use case could could be used for
Jackal. But all in all, the best integrations for Jackal, obviously, is kind of having an area
for token to be lended, being on different decades, so people can have access to our storage
protocol, and all kinds of stuff like that. But the main use case for DeFi protocols is kind of
having chain state backups and data availability in general.
Sounds wonderful. So I guess my next question would be kind of a technical one. So I know that
you have on the consensus size, I believe there are around 100 consensus participants
on the Jackal network, but on the storage provider network, how much can it scale?
Does every validator on the network has to be like a storage provider as well? Or are they
completely like independent complementary roles in Jackal's architecture?
Yeah, so in previous storage networks, like the architecture was kind of you had one big
machine, right? So when, like for follow coin and AR, we have like these proof of work blockchains,
they were Bitcoin forks, they're made in like 2017, right? So the architecture that they
chose is they have these one big $10,000 machine that does storage, and it also does,
it kind of keeps the consensus and kind of mines the blocks as well. We thought that that kind of
reaches a scalability ceiling, because it kind of limits your use case to cold archiving storage,
where you have like, it takes 24 hours to get your files back. And it's great for if you're
putting data to rest for a really long time. But if you want it as like speedy and an active
cloud environment for a different use case, which is a lot of different use cases,
that wasn't going to really work for us. So what we chose to do is we split them into two
machines, and they're kind of purpose built for their job, right? The storage machine shouldn't
be built like the validating machine, and the validating machine shouldn't be built like the
storage machine. So validators don't have to run storage providers, a lot of them do, because
they're just super technical, and they like the ability to kind of monopolize, not monopolize,
but kind of have the ability to earn in different ways on another peer to peer network that we have.
But there's no limits like the validators. So our chain, we have 100 validators,
they come to consensus, and that's all the size of the set is going to be.
On the storage side of things, it can scale horizontally forever. So they can be thousands
and thousands and thousands of storage providers. And it's actually optimized for
having a lot of providers in general, where, yeah, it just completely scales horizontally,
and then they just submit attestations to the blockchain. And we kind of do a little bit of
like roll up off chain verification of the files. So for a scalability boost as well. So
we've kind of talked about like the journey of a file, which kind of gives us a little bit
more insight to how this works, right. So if I have a file, I go to jackal, I tell the validators
that hey, I want to pay for storage, I want to have a file tree, and I want to put this file
into my file tree. And then that happens there. So you do the transaction. Now you have that file
locked on your computer, your file gets encrypted, and then it gets shot over to the storage
providers. Once it hits the storage providers, it gets downloaded by one of them. And then the
storage provider submits an attestation to the blockchain. After all the other providers
around it, verify that that file is there by kind of doing kind of like we call them consensus
spheres, submits an attestation to the chain, and then the chain knows, okay, the deal is done,
that storage provider has the file, they have the storage deal, they proved it to the chain.
And then we have something that's like a redundancy algorithm where now two other
providers, the blockchain and validator set, they say, okay, two more storage deals for
that same file are going out. And then two other providers can grab that and then copy for
redundancy to make sure that we have redundant data storage to make sure that your files just
don't disappear on you. And in the event that one provider goes down, the blockchain will realize
that it's not getting attestations for a specific file, it will break that storage deal, make a
new one with a new provider, then they'll copy from the two other forms of redundancy. So it's
like kind of like an auto healing thing going on, which is pretty cool. But that's kind of the
builds of the system. And that's kind of how we manage redundancy and the journey of a file in
general. Yeah, that's the thing about redundancy. So also like curious to me, like what happens is,
for example, when like a storage provider goes down, but guess you, yeah, like the whole system
has it under control. So we like, or it doesn't see mechanism in place where data doesn't get lost.
Of course, of course, it would be pretty lame, right? And like, if Jack was purely, purely a
marketplace model, where you kind of have a deal with one storage provider, and if you want
redundancy, you'd have to personally make two more deals, and you'd have to manage all those
deals locally. And if you want encryption, you have to manage your encryption keys locally.
So kind of our thought process is people want to pay the chain for storage, and they want it taken
care of, so they don't have to think about it, right? And the other thing is like, the way I
kind of want to put it is, we think Amazon's better than eBay, because no one wants to like
bid on pencils. You know what I mean? Like, they just want to make informed business decisions,
know how much the storage is going to cost and have the blockchain take care of it for them as
a service rather than a marketplace. Cool. Yeah, so that was a nice example. So as for like, I guess,
the next question would be like, for the JKL token specifically, which is the native token of your
jackal chain. So what are the use cases, I guess, apart from, yeah, apart from staking it for
earning staking rewards or, or governance, that would be like, pretty cool to find out like,
the specific use case, because I assume, yeah, given it's the decentralized storage network,
it could have like, many other use cases that might even not be live yet, in which you plan to have.
So it would be cool, like, what's the current state of things in terms of, yeah,
the use cases for the JKL token, as well as the future your future plans. Of course, of course.
So when you look at the JKL token, it does a few things, right? So number one, and most
importantly, it's just a medium of exchange for data storage, where if I want data storage,
I need to use the token in our current, in our current setup, you need to use the JKL token to
pay for storage with the JKL chain and pay for transactions. In the future, we're likely
going to be taking other tokens as payment, especially if we start building these outposts
on other blockchains. So they're going to be paying in archway tokens, and in the background,
we're going to have to swap them for JKL tokens and pay the protocol. But other things, it's
collateral for storage providers, for example, to entice them to have a respectful shutdown of their
machine. So if they go offline, and they choose not to give enough time for the other providers
to take the file off their system, their collateral will be taken. Even if they do go offline,
and their collateral is taken, the network will still heal from the other forms of redundancy.
But just to kind of have a little bit more deep theory to make sure that providers don't drop off.
Slashing mechanism for the providers, yeah. It's the work token for like we have four
applications built on the protocol right now. So it's kind of the work token to capture the
value of the applications. Voting power, obviously, protocol governance. When you state JKL,
right now, it's just the inflationary rewards. In Q2, we're going to be doing our V4 upgrade, which
we turn into a little bit more of a hybrid, where we have like lower inflation, but we also have
real yields from the storage payments. This is a little bit better for the game theory and kind of
has like a more, it just tightens the economy a little bit to make sure that it's more efficient
and we're not paying for more security than we need, and we're also not paying for more
storage providers than is demanded for data storage. So that being said, when people pay
for storage payments, that gets split both to the stakers and the storage providers. So you earn
real yield as well, which is pretty, pretty cool stuff. And the last thing that's really important
that we don't tend to think about too much is why is building a decentralized physical infrastructure
network in general a good idea, right? It's like, okay, we have Google, we have Amazon,
we have Microsoft, we have these really big players. What is the competitive advantage
of building a deep end network? And the biggest thing in this kind of ties into the token
is if I wanted to go toe to toe with Google, I would need billions and billions of dollars
to pay for data centers, right? I need to pay for data centers. I need to pay for
admin people. I need all my operating expenses and my CapEx, all that stuff.
It's super, super, super expensive. So what we can do is we can build a more secure from
a cybersecurity and digital privacy perspective. We can build a cheaper solution. We have tons
and tons of open source, the low platform risk, we can't shut down on you, all these different
things that we can stack these unfair advantages. But the most important thing is the token also
incentivized bootstrap operating expense and bootstrap CapEx. So everyone that is a storage
provider or validated on the network, they're incentivized to improve the public infrastructure
around them, which is pretty, that's the biggest moat that you have to cross when you think about
kind of building a competitor in this space is how do we jump that moat or sidestep that moat
of like this huge upfront capital expenses to build these type of systems in general.
We don't have any admin overhead because the blockchain takes care of that. So we don't need
administrators managing accounts or managing different things on that front. The blockchain
takes care of that, takes care of payments, takes care of all these things, but it also
incentivizes the storage network. And we can build these distributed systems and get hundreds
and hundreds of storage machines that we can incentivize and they're incentivized to do so
in a pretty straightforward and fair way, which is pretty cool as well.
Yeah, really, all boils down to like incentivizing
users around the globe to kind of join this network and to make it like more and more robust
and resilient so that it can pretty much compete with all those big tech web 2 giants that you're
referring to. So yeah, it's like 10X better in pricing power sovereignty, ownership,
the platform risk, the efficiency of the system, it being open source, just global cyber security
posture, admin overhead, no centralized choke points of failure, but we can't even compete
unless we bootstrap the capex of the actual storage machines themselves. So that's the last
piece. And that's why the pin networks are so interesting in general.
Yeah, so we have to give also, I guess, another use case for the JKL token, which is like on
Nolos. So to the audience, so JKL token was listed on Nolos on this Tuesday. So what users on Nolos
could do is they could provide the JKL token as a down payment for taking out the lease position
and to like to reiterate through like what Nolos provides as a solution. So Nolos is an
up chain and with the lending market on top. But it's a different type of lending market compared to
other familiar crypto lending markets, such as Aver compound. So Nolos, you can be either again,
a lender or a borrower, where lenders provide stablecoins only. And the borrowers can borrow
up to 150% of what they deposit. So how that works is the borrower comes and provides down payments
or deposit assets, which it could be JKL token, for example, and they can borrow from the system
up to 150% of that JKL's value. So what the system does then is it borrows from the lenders,
those stablecoins that they provide. And in the background, it transfers those
stables to an integrated decentralized exchange and swaps those stables to the desired asset,
which could be JKL, for example. So in a sense,
borrowers then enter a cross-chain margin long on that asset. So currently Nolos is integrated with
Osmosis and Astroport on Neutron, and we plan to integrate with more DEXs from the Cosmos
ecosystem and beyond, hopefully, in the future. For now, that's the primary use case for the JKL token
on the Nolos. The thing that I like the best about Nolos, and you would do a better job
explaining it than I would, but it's the way that the liquidation process works as well.
And if you could explain that in the sense that it doesn't just liquidate all at once,
it's a little bit different. I would love for you to explain that.
Yes, of course. So liquidations are, first of all, partial, which means that
whenever a borrower enters a position, they have a so-called initial loan-to-value ratio,
which is basically the loan that you get compared to the value of the asset that you're leasing.
So if that loan-to-value ratio goes and reaches the liquidation threshold, which is currently 90%,
then the system performs so-called partial liquidation. And this means that not all
assets in the position are liquidated, but just enough so that the position can
regain a healthy threshold, which is 83% based on current parameters. So
afterwards, the cool thing about it is even if the position gets partially liquidated,
you still have part of your down payment. So if the asset goes up in value again,
you might even be in profit rather than be fully liquidated at once, which other
crypto lending markets are doing. That's pretty cool. And so for you guys right now,
because you guys built throughout the entire bear market, you launched your product, which is super,
I like it a lot. It seems pretty, it's just fascinating in general, the way that you're
able to do these things on the finance side. I have a lot of respect for it in general.
But the other question I have, so like, what's next for Nolix? And what are you guys doing?
Obviously, you guys listed us. Is it more on the listings front? Is it more on different stuff,
different products or different features? What's going on with you guys in the near future?
Yeah, so I guess it kind of all boils down to offering users as many assets as possible
in general in the crypto space. And to offer those assets, you need integrations with other
networks. So what we're basically trying to do is to have Nolix basically be integrated with
as many blockchains as possible to continue its vision for full cross-chain interoperability.
And yeah, we want to expand to also beyond Cosmos because IBC and interchain accounts are cool,
but currently they're kind of tied down to the Cosmos ecosystem itself. And yeah, it would be
cool for Nolix to be like this sort of a communication hub. That's like our, I guess,
long-term vision where users do not have to, like, wouldn't have to care on which chain they are.
Rather, they want to access the product which Nolix offers for a given asset that they want to
like leverage, for example, or lend. And they could do it with one click from the wallet
they are used to. And that's basically it all boils down to like offering the best user
experience as possible for established and new upcoming users in the luxury world.
Of course. And that's the big thing, right? It's the user experience and the wallet UX and the
crashing UX. It's the number one thing that we're all working towards just making that better.
It's pretty fascinating at the end of the day. And yeah, no, it's exciting stuff.
Yeah, it's really pretty important. And it's something that we're like trying to
solve problems on a daily basis and to have the best user experience possible for the users
themselves. So here would come like another question for me, like, how much has Jack changed
since your launch? I believe you launched, you mentioned that you launched at the beginning of
2023, maybe? Yeah. So yeah, I assume a lot has changed.
The best way for me to say it, my mom did a renovation of her house, like I want to say like
six years ago, but it would have been easier for her just to rebuild the house,
where like there's no remaining walls left anyways. And that's kind of the same situation
that we're in with Jack. Also, our origin story. So we started, we were building a polygon,
and then we wanted programmable privacy for the users because like storage without privacy,
it's kind of lame, because like anyone can just like look at the finder on your Mac,
and that's not really acceptable. So then we went to the secret network, and then we built on the
secret network. And then we had like our own peer to peer network, that would be like a hot
storage caching layer for speed, and then we were going to back up the file point.
And then that was kind of like the kind of 2.5 step. And then we kind of hit scalability ceilings
with the infrastructure that we chose. So Jack does like a goofy amount of transactions,
and it's not an easy chain to run for our validators. We love all of them. But at the end
of the day, like we do tons of transactions, and it got unreasonably expensive to operate the
protocol on another L1. And Filecoin, it was taking like 24 hours to get our files back.
Great for cold storage and archiving, but it was not great for the use case that we were
looking to do. So after that, we ended up building our own layer one to Cosmos blockchain,
and then unified our storage layer with our own storage providers.
So that was kind of the last step. And since we launched our chain scalability upgrades,
we moved from proofs to the chain from the storage providers to consensus spheres,
kind of like an L2 that would submit attestations to the chain. We did that.
And then now what kind of we've gotten to the point where the chain is stable,
it's efficient. And then our V4 upgrade is making it more scalable again.
And then having a better economic structure with real yields for the storage providers.
And moving forward, though, and the next thing, of course,
number one, we have outposts, obviously. So we're going to be deploying outposts on every
generic L1 smart contract blockchain. So it's kind of goofy, right? When you look at blockchains in
the situation that we're in, like the storage network shouldn't be competing with developers
for with like optimism or archway or genome or neutron. We should be adding value to those
ecosystems rather than fighting them to get their devs to move to our ecosystem.
And that's why IBC wins. That's why the Cosmos SDK wins, in my opinion. So this outposts model
is we get to deploy Jack will bring all of our functionality to other blockchains and all those
developers can simply use it with a simple smart contract call. Excited for that.
That's going to be going live. We've already started the process of building that.
And then the next thing is AI reg frameworks is kind of what's next for us. So
AI is awesome. As we all know, a lot of people in crypto like use AI kind of like as a LARP
where they just say that it's AI. But Jack provides a really interesting layer of the
stack for AI developers where you can build kind of custom built reg frameworks.
And this is like retrieval augmented generation. So when you use charge EBT that I'm sure
everyone's tried at least once. It doesn't have memory of your business. It doesn't have memory
of anything past like 2021 or last time it was updated and fine tuned. And so businesses can't
afford to fine tune these models. They don't have developers and they can't like build like
a foundational model for their business. And they can't update those rapidly because it's
so expensive. So Jack has a way we call them it's retrieval augmented generation where we can trick
the AI to understand your data without sacrificing privacy, which is cool. So you can like run a
query through a vector database stored on Jack and then it can come up with a response
that delivers context and it delivers value and it's dirt cheap. So that's kind of where we are
right now where we can deal with like line index and stuff like that. So that's kind of on the AI
side we're focusing on some outposts and reg frameworks. That's the focus for us right now.
Awesome. And these outposts do you plan to be like a smart contract instances on the
chains that you were like simply deployed them on? Yeah, it's a really good question. We have a
blog on our website about this and I would do it justice as much as B would, who is our kind of
cross chain development lead. But essentially what we did is we took the entire blockchain modules
that Jackal has, we ported them into a cosmozom interchain controller contract. And then we are going
to deploy that on another blockchain. So it has all of our modules and all of our functionality
locally in a smart contract instance. That being said, essentially the user can query that like
just have a smart contract call. You can do actions like you're on the Jackal protocol and what
that smart contract is going to do is it's going to use IBC's like arbitrary data message passing
to get that message back to the Jackal protocol. So the Jackal protocol can do an action on the
user's behalf. It's not light work, but it's essentially what we've done. And we're looking
in the next three months, we're probably going to be deploying that on archway pretty soon.
And do you plan to use like interchain accounts for that or IBC hooks?
Yeah, so there's something called the interchain controller contract,
which is kind of made by Surdar at the ICF where the issue with cosmoz is everyone's on a different
CW version. And everyone has like, there's like, there's Ignite, and there's a cosmoz SDK,
and then there's like the osmosis fork of the cosmoz SDK. So everyone's kind of doing their own
thing. But that being said, we can use this without people updated the latest CW version,
which is cool. So if they don't have interchain accounts, they don't need it. We just kind of
sidestep that by building the interchain controller contract with Surdar at the ICF, which is pretty
cool. Awesome. Yeah, we are also in talks with the IBC team and Surdar specifically, I'm familiar
with what you mentioned the controller. So yeah, as people know, we rely on interchain accounts
for cross chain communication. So it's just a constant process of trying to optimize this technology
because it works pretty well for our use case for integrating with other cosmoz chains and access.
So yeah, it's pretty amazing what IBC offers in general, not only as like a bridging solution for
our assets, but as a trust minimize cross chain communication standard. It's something that I
really hope this will be expanded to the EVM world as well. Yeah, that's the next thing for us
is while we're speaking with, I can put you conscious of the union guys too. I don't know
if you've talked to them yet where they're kind of doing IBC to Ethereum. So we can get on EVM
chains with the outposts too. And if you guys are kind of looking at IBC in general for that,
like what they're doing is pretty cool. And we're looking to piggyback on that to get
distribution to EVM as well. No, we haven't talked with the union folks yet, but we're curious to
connect, I guess, and discuss. Anyways, I have another call, unfortunately, in about three minutes.
So we're gonna wrap it up. But it was really awesome talking with you guys. I really appreciate
it. I'm excited to be integrated. I'm excited for people to have the ability to leverage
Jacko on your protocol. And yeah, it's gonna be a lot of fun. Really glad that you were our guests.
And it's really looking forward to finding other ways to cooperate between
MOS and Jacko in the future. So I'm pretty excited about both our roadmaps. And yeah,
thanks for being here. Of course. Thank you so much. Take it easy, everyone. Cheers.