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Orchid CEO Dr. Steven Waterhouse answers users’ questions in Hillrise Capital AMA

Orchid CEO Dr. Steven Waterhouse answers users’ questions in Hillrise Capital AMA

Mar 8, 2021

Last month Orchid's co-founder and CEO Dr. Steven Waterhouse (Seven) answered questions in a Telegram AMA with Hillrise Capital. For those who were unable to join, here are some key takeaways and highlights from the event.

Why Orchid?

The first questions focused on Seven's background and his reasons for co-founding Orchid. "My personal motivation was driven by a strong concern about overreaching surveillance and censorship online which I developed over many years, especially the early days of Bitcoin," he says.

One question asked: How do you feel about the usage of your product for subverting various restrictions? Is it even relevant for you if we see a large migration of users onto Orchid's VPN for this purpose?

"I think people should obviously abide by local rules and restrictions and be concerned when they are not," says Seven. "In general, I'm concerned globally about the tendency we have to silence voices we don't want to hear, no matter where we are or what the voices are. This is one of the biggest challenges we have as a global society going forwards."

"There are no easy answers. We aim to provide tools to give people a choice, and ideally to combat widespread mass surveillance," he continues.

What people are using Orchid for

The discussion moved on to the things people are using Orchid for in the real world: Orchid has grown from strength to strength since its inception. You have a working product which is refreshing and a strong community built around it. Of the variety of use cases, where do you think Orchid has found the best product-market fit?

"We are starting from a crypto-focused audience, so many use cases around geolocation are useful," says Seven. "Currently we are expanding our provider list to include non-US locations. It will be interesting to see growth there. Overall we don't know what people do since we have no logs or anything like that. But from what we hear, people find it valuable, and as we develop more features with the community, it will be interesting to see what happens next."

Orchid nanopayments

The conversation shifted to Orchid's unique payments system, probabilistic nanopayments, which use the Orchid digital asset OXT: You've developed a very novel 'nanopayments' model in Orchid through the use of probabilistic payments. Firstly, could you introduce and explain that system in your own words and secondly, what motivated you to take this approach? Have you seen this model used elsewhere? We can see this potentially being used in other 'pay-as-you-go' service models or subscription-based services.

"Fun question!" says Seven, who then walks the audience through a step-by-step explanation of what nanopayments are, what problems they solve, and how they work: "The idea came from an observation about the security of payments in a decentralized services model like Orchid.  What I mean by that is that we are used to the idea of centralized services where a service provider, e.g. Amazon Web Services, provides you hosting for your app in return for a monthly fee for example.

"While you may be being billed by the byte in bandwidth, or by storage used, you are still being charged monthly. In a decentralized model we need to think differently. If you are providing me service, how do we negotiate when I pay you and when you provide service?"

"If we do this on a monthly basis, then the problem is, you could run off with the money or I could run out and not pay. So the smaller the granularity of payments -- e.g. a week is better, then a day is better still -- the better. Follow me so far?"

"So then ideally what we would do is send payments with each packet that is served by the provider, which is a very very small payment and on a very very small time scale. Here's the problem: current blockchain tech doesn't do this, and no amount of L2 scaling is going to fix that unless we just switch to a centralized model -- which doesn't work for privacy. So this is the key problem: we want very small and very fast decentralized payments."

"The idea we use with Orchid is instead of sending small amounts of OXT with every packet on chain, which would be a disaster in gas fees and also be way too slow for data networks, we instead send you the 'chance' of a payment."

"Hang on, you say, you're not giving me a payment, it's like a lottery ticket? Yes -- that's right. And why this works, is that the number of payments a provider receives is massive in number over time, and so the expected value evens out to the same as if we sent small actual payments with each packet."

"We can scale this to pretty much any speed we want -- think orders of magnitude faster than any chain it is deployed on."

The outlook for privacy broadly

Seven is a prolific thinker, writing and speaking often on the topic, which prompted the question: We love the pieces you've written on internet hygiene and web security on the Orchid blog to date. The topics discussed there are becoming more important than ever as we move to live a larger part of our lives online. That being said, where do you think the future of personal internet hygiene and web security is going? How do we balance it with a poorer user-experience due to the above?

"There is always a tradeoff between what people think is convenient and what is secure," says Seven. "For example it's much easier not to use two-factor authentication (2FA) and just reuse your passwords right? But we all hopefully know that is not secure -- please, please use 2FA if you don't already on all your accounts, and ideally use a password manager also. With that said, we are getting better in two areas -- ease of use and education."

The Priv8 Virtual Privacy Summit

Finally, attention turned to Priv8, Orchid's innovative upcoming event focused on privacy, which will feature famed whistleblower Edward Snowden among many other leaders and experts. Priv8 will take place over three days, from March 23-25. A full schedule of events, as well as additional details about Priv8, will be made public over the coming weeks. You can register here to attend.

The moderator asked: The guest lineup for your Priv8 Summit is looking exceptional so far. Namely you have Edward Snowden and Zooko Wilcox participating. What can we look forward to from this event and is there anyone else you're excited to have onboard?

"Well Ken Liu, renowned sci fi author from China who translated The Three-Body Problem is one of my new favorite additions. The book is a deep sci fi novel that touches on aspects of Chinese surveillance and censorship using metaphors developed in a strange near-future universe."

"We will have some surprises also 🙂"

The full AMA can be found here

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Feb 23, 2021
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