Space Invaders Alpha Leaks : Episode 9 with Karl Kreder from GridPlus

Cryptex (CTX) the protocol and community behind Total Crypto Market Cap token (TCAP), is constantly inspired and impressed with the creators and builders of web3. Cryptex created Space Invaders to help people get an inside look into the minds of the most important web3 creators and builders of our time.\

Typically these episodes are recorded live on Twitter Spaces then published on YouTube and a variety of podcast platforms.

On October 29th, 2021 Cryptex welcomed BFresh as our host. Cryptex featured Karl Kreder and Nate as our guests for the ninth episode of Space Invaders. Karl Kreder is the cofounder of GridPlus, and Nate is an GridPlus engineer.

In this post, we are sharing the most thought-provoking and alpha-infused pieces of the conversation. These are things most people would not get a chance to find out unless they were listening to the conversation at air time, which you can find on our Youtube channel and podcast formats.

Read on for the alpha leaks from Space Invaders Episode 9 with Karl Kreder from GridPlus.

BFresh: So before we do get into everything GridPlus related, I kind of want to get a little bit of background from you guys. What got you guys into crypto in the first place?

Karl: So I'm kind of an early crypto guy, found out about Bitcoin, probably like in 2011.

BFresh: That's really early, I think it's the earliest so far, I've heard.

Karl: I actually first heard about Bitcoin on NPR. One of my hang-ups with it was that at that point in time to get a Bitcoin, you had to do some odd stuff, like get a phone card from Walmart so that you could convert it into an OK pay card and then you could get it on Mt.Gox to buy Bitcoin. So at that point, I was like, this sounds ridiculous. The year lag time between when I first looked at it and when I bought into it ultimately cost me 10x or 20x for that lack of foresight.

After I got a job working for a Consensus, in early 2017, I got set up with Alex and Mark and we came up with the idea for GridPlus. We spun out of Consensus and from day one at GridPlus I've been working on a sort of custodial ship solution for your everyday user so that they could actually use crypto and normal commerce. And that's really what we're trying to accomplish with the Lattice1.

Nate: Last year I came across GridPlus, and I saw what was going on and I thought this is something I can really get behind. So I ended up with the job here, I'm working on the Phonon project, which is something very interesting.

BFresh: That's cool. And I guess, furthering the conversation, as long as it's not too much alpha that you guys will leak on the Phonon, what are you working on?

Karl: Well, I'll leave it loose. Phonon is actually a super interesting thing. So basically it's a hardware and forced off chain, scalable payments solution. So what it basically does is it allows you to securely and privately transfer keys between smart cards.

BFresh: Oh, wow.

Karl: I call it a Layer zero scaling solution because, as long as the card supports the curve that exists in a protocol, it is compatible with that protocol. The thing that's most interesting about it, if you start to dig into it, to give you sort of the quick form is, is we've actually created digital cash.

Bitcoin isn't digital cash. Bitcoin is the federal reserve, plus the SWIFT system. That's what Bitcoin is, right. It needs the internet, it still needs nodes to re-up. But what we've created are these cards that have physical uniqueness in physical space, and you uniquely load a key onto that card. And that is the only copy of that asset in existence, just like a dollar bill. Except you can digitally trade them. So if I hook my card up to my phone or my computer, and then, Nate put his card up, we can send it, it doesn't have to transmit a note through a node.

I'm just trading one key for another. So I can load sort of a Bitcoin on my card, and then I can shoot it over to Nate and then Nate will like receive it. So it's, it's a really interesting system because it takes sort of that economic threshold and that scalability issues with throughput on blockchains, and it basically drives it to zero. So there's like use cases where you could in an economically viable way, use blockchain based assets, turn them into Phonons and trade them a penny at a time for like a micropayment solution. You could create Phonons that you use for everyday settlement by carrying around a SIM card that's in your phone. And then you can also use it on a bigger scale as a cross chain deck. So, because it's compatible with any blockchain, I could trade Phonons from any blockchain to any counterparty who has a Phonon card.

BFresh: Wow. As you guys mentioned, this is something you're working on currently. It's not live yet I would assume.

Karl: Yeah. So, so we actually published the first Phonon transfer video that happened last Thursday. So we're looking to do an alpha release of this probably in the next four weeks. I'm just super excited about it because of the technological implications that it brings to the table. And when I think about it, I kind of, in some ways, like to think about it as the most dangerous thing since Bitcoin.

BFresh: Like the most disruptive thing really.

Karl: It's also private too. It kind of brings like a privacy layer to every blockchain. Because if people will compose Phonons in typical unit values. Right. So maybe I do like 0.01 ETH, 0.1 ETH or 1 ETH in Phonon. But then any account, any EOA on Ethereum that has one of those values, may be a Phonon and those Phonons then can trade peer to peer off chain, an infinite number of times before being moved or redeemed back on chain.

So that makes anything that ever exists on any blockchain in one of those common increments, sort of like provably, deniably, a Phonon.

There's a lot to go into, if people want to check out more, they can just go to phonon.network. You also can look at the GridPlus blog, we kind of have like a summary, couple articles about it and the first Phonon transfer that happened today.

BFresh: That's awesome. I guess that's going to be something extra to look forward to, in addition to what Lattice1 already provides. Would I be correct in stating that the Lattice1 is the flagship hardware wallet that you guys provide or are there different multiple card wallets you guys have?

Karl: It's the Lattice1, plus the safe cards so to speak. So the Lattice1 is a secure terminal. It has anti tamper, it runs an HSM hardware security module, and it basically allows you to interface with either the account it's native on the device itself, or any number of what we call safe cards. Each one of those safe cards or the account that's on board is effectively a secure enclave and its purpose is basically storing a seed phrase. So each card that you have can be a different copy of one of your seed phrases. What's really cool about that is you can take like your physical seed phrase, and instead of having that in plain text, you can still have it in a physical format, but it's PIN protected. So in some ways that's a lot easier to deal with than having to do with a plain text seed phrase.

To catch the full episode, go to:

Youtube: https://youtu.be/waEkPc-GeEE Podcast: https://anchor.fm/cryptex Karl's Twitter: https://twitter.com/mechanikalk Learn more about Cryptex & TCAP: Website: https://cryptex.finance/ Twitter: https://twitter.com/cryptexfinance

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