Today, we have an interview with Kai Chng, founder of Digix Global, a company that aims to tokenize physical assets and make them fungible on the Ethereum blockchain in order to increase the pool of liquidity in a decentralized marketplace. Read on for more insight from Kai!
Hi Kai, thanks for taking the time to speak with us today. Can you begin by telling us a little bit about yourself and what you’re doing over at Digix Global?
Hello, I am the co-founder of Digix, an asset tokenization platform on the Ethereum Blockchain. Digix aims to marry the functionality and transactional utility of crypto coins with real world physical assets on the blockchain. This allows users to unlock the store of value of physical assets and use them as a medium of exchange over the internet easily and efficiently.
I left my career as a wall street trader and took the plunge into blockchain technologies because I realized how disruptive and amazing what this technology would bring.
Digix uses three modular processes to provide a chain of custody for an asset, which makes the platform suitable for much more than Gold. They are the Proof of Asset (PoA) Certification, Minter DAE, and the Recaster DAE
Could you go a bit more in-depth to each of your three modular processes?
– Proof of Asset (PoA) Certification process, which is used to create PoA Asset cards. The asset cards are certified using digital signatures from the chain of custody, which are validated with proof of receipts
– Minter DAE (Decentralized Autonomous Entity) to create DGX tokens that work by accepting PoA Certificates, allowing users to issue divisible (DGX) Digix Asset tokens.
– Recaster DAE, which is used to convert DGX tokens back into PoA Asset cards.
What aspect of your company do you believe will be most disruptive?
The ability to unlock the store of wealth and use it as an efficient, fungible medium of exchange in tangible assets will provide a higher quality of life to everyone. Several digital gold companies have failed in the past due to its centralised nature. By creating our service offering on top of the blockchain, we represent the next step in digital gold, making it much safer, transparent and auditable.
Who is your target user?
We are targeting high net worth individuals who want to safe keep their wealth to the Reddit or Twitch user who is looking to tip users. We are also hoping peripheral Dapps look into building Dapps around our DGX gold tokens. Some examples could be games, wealth inheritance smart contracts services for DGX gold tokens, decentralized fundraising Dapps utilizing DGX gold. Wealth management Dapps like EtherPlan is also planning to list DGX gold as an investment product.
What are some challenges you are facing as you continue to develop your platform?
The key challenge is education. A lot more education and knowledge exchange are necessary for wider mass adoption. This can only be done via working together with other more developed blockchains. There are some who see Ethereum as a threat to other blockchain systems, but truly in my opinion, it should co-exist as part of a wider ecosystem of blockchains.
Going back to you personally for a bit – how did you get into Bitcoin? Why did you choose Ethereum to develop your platform on?
I had always been interested in currencies and how it functions as a medium of exchange. When I was a kid, the most perplexing conundrum I had was how fiat money held a store of value when it is not tied to any physical assets, which led me to delve into the history of money. When bitcoin came about and read about it in forums, I saw that it was an evolution of fiat money without some of the pitfalls of modern fiat money systems, one of which importantly is currency manipulation.
It just made sense to me that this will be the way value transactions occur in the near future, so I took a plunge and invested some money and time into it. The more I read, the more I believed in its utility, and I have never looked back since. That was in 2011.
Etheruem made sense for what we are trying to build because the bulk of our service offerings is smart contract codes uploaded onto the blockchain itself.
What are your thoughts regarding some concerns about Dapp development on Ethereum, such as the potential of someone copying and using protocols you’ve developed?
That is a valid concern. Digix essentially bridges the gap between the traditional businesses and the blockchain. The due diligence and best practice needed to ensure that real-world logistics within the chain of custody operate smoothly is hard to emulate, but granted, is not impossible to do so.
But just like Linux and Redhat, we aim to provide services such as timely updates, active feedback and improvements, better user interface, ease of use, etc. Thus, we compete based on the quality of our service, our expertise, and our commitment to delivering a top notch product.
How do you differ from competitors like Colu and Vaultoro?
We aim to allow every exchange to operate like Vaultoro. The service of providing gold as a hedge to the price volatility of cryptocurrencies can thus be extended to any exchange that accepts DGX tokens as a crypto-currency pair.
Digix only focuses on high-value tangible assets and proving its existence not just by relying on paper trails. We have an actual participating custodial vault that stores these tangible assets and an independent auditor to verify this regularly. Our proof of asset certification is not only a paper acknowledgment of an underlying product, but also contains the legally valid digital signatures of all entities in the chain of custody that acknowledges the existence of the tangible asset.
Is there anything you’d like to say to the readers?
I hope for the day that bitcoin and crypto assets become as widespread and common as fiat, that I could walk into any coffee shops in my neighborhood and pay with any of these cryptocurrencies or assets in my mobile wallet. I hope that more and more people will see bitcoin and blockchain technology as something accessible just like email and the internet.
What are your thoughts on Digix and the like building these services on blockchain platforms? Let us know in the comments below!
Images courtesy of Dgx.io and blog.CEX.io