Jonathan Ha is best known as the CEO of Red Pulse, a tokenized research ecosystem for China’s economy and capital markets. The company incorporates its own cryptocurrency ‘RPX’ to facilitate an open and transparent sharing economy for research, and is developing a machine learning-based matching engine to connect industry experts with institutions seeking market insights to make better business decisions.
Jon was kind enough to spare some time to have a chat about Red Pulse, and shared with us some insights into tokenising your business, and blockchain’s potential to disrupt share economies.
Jon will be joining us at Blocfest, presenting the topic: “Tokenising Your Business: Who, When, and Why?”.
Sean: How did your journey into blockchain begin?
Jonathan Ha: I’ve been familiar with blockchain as a concept and cryptocurrencies for several years already, but my journey really began last year in early 2017, when we first started considering pivoting our business model and platform towards incorporating blockchain technology and our own token economy. Things came together very quickly. We finalized our business model and token economics, wrote our whitepaper, signed on great strategic partners such as NEO, Hashed, and Kenetic, and were well on our way.
Sean: Was the appeal for you more from a technological or ideological standpoint?
Jonathan Ha: I think it’s difficult to separate the technological and ideological aspects of blockchain. They are often intertwined. Take for example, the decentralized nature of blockchain. By creating an infrastructure that doesn’t rely upon trusting any authority or 3rd party entit(ies), technology has enabled a new way for people to interact with each other, which can go hand in hand with the ideology that perhaps there shouldn’t be a single authoritative power that governs certain interactions and exchanges of value. This same technology that creates an immutable record also results in a permanent “system of record” that is free from subsequent manipulation, something that the world has previously never had before.
Sean: What is Red Pulse and what are the problems that the platform attempts to tackle?
Jonathan Ha: Red Pulse and our PHOENIX platform is a knowledge ecosystem that connects financial institutions & corporates with industry experts & analysts sharing their valuable insights. The key problem that our platform aims to tackle is information overload.
Sean: How does blockchain help Red Pulse do this?
Jonathan Ha: Blockchain helps us to solve information overload in a few ways. First, in order to solve information overload, you need to establish context and relevance at the user level. To achieve relevance, while considering that what is relevant to each person is different, you must first achieve large scale and scope of content. Blockchain, and by extension our token economy, allows us to scale the knowledge and content side of our platform incredibly faster than a conventional model, as we use our token as an incentive for producing and rating quality content.
Sean: Red Pulse was the very first company to hold an ICO on the NEO protocol. What led to the decision of choosing NEO as the preferred protocol, over say Ethereum?
Jonathan Ha: We chose NEO for several reasons. NEO as a platform and technology has been able to benefit greatly from pioneers that came before them, taking good lessons from previous platforms while addressing some of the shortcomings that have hampered others. In particular, the scaling of their platform while maintaining a high transactions per second and low resource usage ratio is possible using an innovative delegated Byzantine Fault Tolerance consensus algorithm. We also chose NEO because they were relatively new on the scene in terms of providing smart contract capability, yet were fundamentally very sound. Thus we continue to have the unique opportunity to work closely with the core dev team and founders on building our platform and ecosystem.
Sean: What is the purpose of Red Pulse’s token — in terms of its utility?
Jonathan Ha: We recently concluded our platform infrastructure upgrade and token swap from RPX to PHX, denoting our new PHOENIX platform launch. The purpose of the PHX token is many fold. The PHX token is the currency in which we incentivize content creation on our PHOENIX knowledge platform. Content contributors and curators (raters of content) receive PHX as compensation for their work. The PHX is also the native currency in which our clients, consisting of financial institutions and other corporates, can request for on-demand research and insights. This has already been implemented in our Ask the Analyst feature, which allows readers to directly ask questions to the original author of a research note, and compensate them with PHX. In the future, as we scale our platform to include a knowledge network of industry experts and practitioners, clients will also be able to use PHX to commission bespoke research services directly from the expert.
Sean: Many firms are looking to blockchain for solutions — some are chasing the hype, but many are also genuinely interested in decentralising. What are the opportunities present for companies who are looking to tokenise? What are the benefits for them and why should they consider it?
Jonathan Ha: Indeed there are many firms out there looking to tokenise. From a token sale fundraising standpoint, a major benefit is a potentially much faster and efficient capital raising process, even when taking into account the greater degree of legal, compliance, and reporting elements that token sales are now required to include. Another benefit is being able to raise from a large group of retail individuals, similar to a crowdfunding but at much greater scale, which provides an opportunity to build a user base and community for your product, platform, or service, perhaps even before it is fully ready to be launched.
From a business model perspective, the opportunities gained from tokenization are specific to each company and industry. Decentralization, security, transparency, incentivization, and scalability are often core elements that are leveraged to enhance or even disrupt traditional business models.
Sean: Conversely, as someone who has successfully built a fully-fledged company with its own token, what have been the challenges of implementing a token economy into your business model?
Jonathan Ha: I think the biggest hurdle to creating a sustainable token-based economy is the extent to which a fiat-to-crypto mechanism is needed, and how readily will this new token-based model be adopted by existing and future users. For certain business models, the entirety of the value chain and transactions reside within the blockchain space, whether on-chain or off-chain, and thus there is less impact from this. Most business models do require interactive and value exchange outside of crypto markets however, and how, and to what scale, their customers adopt and interact with the new token economy will determine the business’ success.
Sean: What advice would you give to business owners who are looking to tokenise?
Jonathan Ha: Spend enough time on the business model to ensure it makes sense to use tokens. Can you achieve your vision and objectives using conventional fiat currency instead? Next, make sure you are fully compliant. Gone are the days that people can tokenise their business without proper advice and guidance. Hire legal, accounting, and advisory services to ensure that your tokenization not only a success commercially, but also from a legal and compliance standpoint.
Sean: Let’s talk about the potential of blockchain’s impact on the future of the sharing economy. Centralised companies like Uber are doing extremely well, but a common critique with these share economy companies is that they are tied to centralised payment systems like credit cards — and we’ve seen customer data compromised in the past. Do you think cryptocurrencies hold the answer to catalysing innovation in the shared economy?
Jonathan Ha: Actually, I think the tie to credit cards is not a problem with current sharing economies, in my view and on balance, I think it’s an incredibly helpful element that enhances the convenience factor and scalability of such platforms, by moving away from the dependency on physical currency.
Cryptocurrencies could one day play a similar role in scaling sharing economies, but unfortunately the degree of cryptocurrency adoption is no where close to the level of global adoption of credit cards. At this point, it would be more of a hindrance than a help. That being said, there are other reasons why cryptocurrencies could be helpful to sharing economies, perhaps even to bring about a new paradigm of sharing economies.
One way this can be achieved is through enhanced transparency into who are the main economic beneficiaries of the sharing economy model, and more explicitly, disintermediate much of the economics that concentrate into the hands of centralized corporates.
Sean: How far away are we from ‘mainstream adoption’, and what are the biggest hurdles in blockchain that need to be solved before that can happen?
Jonathan Ha: The point at which we achieve mainstream adoption is rather subjective, but I would say that we’re about 5 years away from it. That seems very soon to most people, but you have to understand that new technology and the adoption of it moves along an exponential curve. There are two major hurdles: first, most blockchain applications haven’t even been proven to be effective yet, with many projects still at the phase of building their technology and launching mainnet. That is very different from actually producing and enabling value in the real world. Separate but related, the second hurdle is not yet having enough robust bridges, or as others put it, onramps and offramps, between the blockchain and the “real world”. Oracles are used to provide data from the real world on to the blockchain, so that it can act as inputs to smart contracts. Yet, there are still many inefficiencies and scaling issues.
Sean: We’re excited to have you present at Blocfest! Are you looking forward to the experience?
Jonathan Ha: I’m most excited about participating in my first blockchain event in Malaysia, and the premier conference that is Blocfest. Southeast Asia is an up and coming cryptocurrency market, and I’m honored to be invited to be a part of it.
Sean: Thanks, Jon! Is there anything upcoming for Red Pulse that you want our audience to know about?
Jonathan Ha: We are launching new products and features on our PHOENIX platform literally on a weekly basis. Everybody is invited to join the platform and earn PHX by contributing content or rating quality content. Check it out at www.redpulse.com.
Find out more about Red Pulse here.
Connect with Red Pulse on Twitter here.
Jonathan Ha will be joining us at Blocfest as a panelist on the discussion topic: “Tokenising Your Business: Who, When, and Why?”. Hear from him and many other thought-leaders as we deep-dive into all things blockchain this September.
With a raft of respected blockchain thought-leaders from Malaysia and around the world set to feature, Blocfest’s focus will be on blockchain’s immense potential in the Southeast Asian region, where the technology has already made great headway.
Blocfest is set to launch 26-27 September, and guests are invited to also join us for KL Blockchain Week.
Find out more about our speakers by clicking here.
Sean’s unequivocal passion for all things blockchain blossomed in late 2016. Starting off his journey as a daytrader, he found himself quickly immersed in the projects and their visions of a decentralised future economy. He is Content Director at Blockchain Asia Connect, and publisher of blockchain blog Channel 3.0. When he’s not busy writing about and exploring the world of blockchain, he’s running his music blog passion project: Producer Hive.