Blockchain and decentralization are the buzzwords of Web 3.0. Bitcoin (BTC) and other cryptocurrencies showed us what a store of value or currency could be on this iteration of the internet. Ethereum (ETH) showed us decentralized finance (DeFi) and a bankless future. What will come next?
A crypto VPN for now
What else is there that can be decentralized? Well, everything, really. BeInCrypto sat down with Orchid CEO Steven Waterhouse, aka “Seven,” and talked about the other side of decentralization.
Orchid isn’t the only project that is offering a decentralized VPN, but it is likely the most far along. Besides an early listing on Coinbase, Orchid has an up and crypto VPN system that you can use right now.
Traditional VPNs are mostly used to conceal identity and information. But as Waterhouse points out, they are not actually hiding anything. VPN companies have users’ names and IPs, and payment information.
What’s more, some readily give up information to governments, or are hacked out of user info. Enter Orchid, a VPN that hops from node to node to conceal identity, similar to Tor. But bandwidth on Orchid is paid in Orchid tokens (OXT), and node keepers thus reap OXT rewards.
The hoodie-clad Waterhouse spoke from his home in Portugal with his two beautiful Persian cats. His words are carefully thought out, and he feels strikingly honest and down-to-earth.
Even though Orchid is a project that is not about finance, Waterhouse says that everything, in some sense, is about finance:
“Economics defines the world we live in. We have, say, a capitalist design of economics, so of course everything is in currencies.”
“But much of crypto is trying to reinvent the financial system. Ethereum, ICOs, it is all a redesign of how people invest in startups. It used to be to get money, you go down Sand Hill Road [Silicon Valley], knock on a door to get more. Develop some, come back for more and more. Then there was 2017.”
“Now anyone can contribute capital. It led to some crazy things being funded, people betting on all sorts of weird ideas.”
Blockchain beyond finance
Some of those ideas crashed and burned, just like any investment cycle. But more recently DeFi shook things up again. This trend will continue, Waterhouse says, throughout many industries.
“You have seen DeFi redefine more traditional banking products, how yield returning assets are built. We are going to move into a space where other kinds of services are experimented on and built with crypto,” he stipulated.
“For example, things like Golem, Filecoin, Livepeer. They’re not financial. But there is staking, and there is a financial return. Services using cryptocurrency pay for consumption and reward with crypto.”
“Everything is now permissionless. You shouldn’t have to sign up and give information. Like, I got a server. Want to store your data on my server? Boom, we’re done. For Orchid, it is like, want to route traffic through me? Boom. There’s some bandwidth.”
The trick is finding an industry well-suited to crypto. Waterhouse believes that VPNs are just such an industry.
“If you want to have hundreds of thousands of providers in a VPN network, using a centralized architecture and billing arrangements doesn’t make sense. You need crypto for that kind of system,” he said, and added:
“There are some businesses where big GPU farms are what you want to use. So it is challenging to find a particular application in a distributed computer system that makes sense. We’re still experimenting with decentralized VPN.”
The true value of the VPN
The problem with current VPN, he says, is not just that protection of information:
“There’s two things you want when it comes to VPN in a country. You want to be in the country (like watching HBO Max in Portugal). Or, I definitely don’t want to be in this country (like a bad person who is trading on Binance if they live in the US).”
“The point is, that besides privacy, VPNs have only two tasks when it comes to location. If you’re in China and you want to look like you’re in Singapore, you still can’t watch HBO Max. We are trying to sell the VPN that doesn’t just say it does these things. We want to create the VPN you actually want.”
When it comes to firewalls and what is legal in countries (China being one example), these problems map differently in different countries. Orchid’s VPN could be very useful from a point of view of freedom.
“This organization called ‘Freedom on the Net’ tracks these things. For example, in Indonesia, satire is banned. You can’t make fun of the government. Like something that led to violence, shootings, in France. That is outlawed in some parts of the world. You are faced with this fairly common issue of different things being controlled in different places. Places where getting a real VPN, especially one that works, is easier said than done. So the Gold Standard of VPN technology is trying to circumvent these things. This is what we want to create,” said Waterhouse.
And it is encryption that is the crux of why VPN is useful and is well suited to encryption. Waterhouse went further saying:
“People who are in crypto, or who travel, or who travelled before pandemic times, we all want privacy. You don’t want the Airbnb or the Hotel to know you’re watching your favorite show via a VPN, or what you’re searching for on Google for that matter.”
“These are the basic use cases: censorship and surveillance. They go hand in hand more than we realize.”