After "graduating" from Ant, they immersed themselves in Web3

The two highly anticipated technological revolutions in the tech world are AI and Web3. AI is expected to reshape productivity, while Web3 is hoped to reshape production relationships.

In 2023, there are heavy news almost every day in the tech circle. This is the year of generative AI and also a deep bear market for Web3. The total financing for Web3 this year is only $3.6 billion, a 78% decrease compared to $16 billion in 2022. In the first half of the year, financing in the AI field reached $25 billion. The largest venture capital in cryptocurrency, Paradigm, has begun to expand its focus to AI.

People who once thought "Web3 is sexy" now feel that "Web3 is no longer sexy" and have turned their attention to AI.

But it must be acknowledged that this deep bear market of Web3 is more lively than in previous years. During the bear market, some people are still discussing compliance, zero-knowledge proofs, and Bitcoin ETFs. There are also those who choose to enter the market at this time.

"When I was at Ant, I often discussed AI and Web3 with my colleagues, and their development trajectories are quite similar." Jerry Li compared and said that artificial intelligence has experienced three waves over the past sixty years, with investments ranging from billions to tens of billions each time, with peaks and troughs alternating, until OpenAI emerged. "This new large-scale technological revolution needs to go through multiple cycles to bring about leapfrog development."

Jerry Li has had several prominent titles: former Chief Architect of Ant Blockchain, former Director of R&D at Apple China, and top scorer in the college entrance examination in Shanxi Province. Now he has added another - a newcomer to Web3.

Strictly speaking, Jerry is not a newcomer to Web3. After graduating from Tsinghua University, he worked in Silicon Valley for over 10 years, and in 2015 he returned to Shanghai to establish the Apple Asia Pacific R&D Center. In 2017, Jerry joined the "Ant Blockchain" which had not yet upgraded to "Ant Chain", at the P10 level.

"The industry is still too early, not even reaching the previous development stage of AI. Currently, the total market value of the entire cryptocurrency market is less than half of that of Apple." Compared to his former employer, Jerry believes that the Web3 pie is still too small.

Of course, compared to AI, which has been around for over fifty years, Web3 seems to still be in its adolescence. The concept of Web3 was first proposed in 2014, and its predecessors "cryptocurrency" and "blockchain" were introduced just 15 years ago in 2008 through Satoshi Nakamoto's Bitcoin white paper.

Rebellious and unstable, Web3 is going through a painful period, making the "parents" shake their heads. After the collapse of FTX, which had a market value of $32 billion last November, regulators around the world began to impose strict regulations on this "troublesome child."

At this juncture, at the end of 2022, Jerry left Ant Chain and fully devoted himself to Web3, starting a public chain project called Artela. He stated that he would not consider doing anything else in the short term. When discussing the reason, Jerry quoted a famous saying from Ant: "Because I believe, I see."

Artela has chosen the public chain track, which is part of the Web3 infrastructure and is also referred to as the "highway" of Web3; only with roads can all things be transported.

In the public chain track, there are Web3 genesis projects like Ethereum that have been developed for many years, establishing a moat through the ecological "network effect," followed by multiple all-star lineup projects.

Now choosing this more crowded track, The Wall Street Journal discussed with Jerry his views on "first-mover advantage."

"Although the public chain market is highly competitive, it is still quite imperfect, with significant gaps. " Recently, Jerry has been attending conferences globally, which is his first step in adapting to his new identity. After going around, his confidence has actually increased. "After communicating with numerous projects, our confidence has grown."

The biggest difference between Artela and other chains lies not in the current "involution" of scalability, but in functional scalability. It is also compatible with the Ethereum Virtual Machine, allowing developers to transfer applications with a single click.

This is preparing for large-scale adoption in the future.

Mass adoption is a term often mentioned in the context of Web3. In other contexts, it can also be described as the "iPhone moment for the industry" and the "last mile," but the core question is clear: how can we enable ordinary people to use Web3?

The "Ant Gang" is the driving force behind mass adoption in the internet era. In their view, mass adoption is more about building another "Alipay" in Web3.

Of course they have rich experience. Artela's CTO Qiu Honglin ( alias: CP) was responsible for the underlying architecture support of Ant Group's digital collectibles platform Whale Exploration. He stated that Whale Exploration had already achieved over 100 million daily active users through the Spring Festival "Five Blessings" event. "At that time, we were already able to stably handle hundreds of millions of transactions on-chain, while Ethereum was only in the millions. To some extent, Ant Chain has already achieved true large-scale adoption."

CP is a veteran of the Ant Chain team, having joined the initial form of Ant Chain in 2015, when it was still an interest incubation group.

"They say that if someone in Ant Group wants to talk about blockchain, they will definitely mention my name when they ask the second person." CP has slightly wavy hair and speaks with a bit of a Cantonese accent, making the conversation feel casual, yet upon closer listening, the content is very professional and detailed. Ant Chain holds the most blockchain patents globally, and CP alone possesses hundreds of them.

Regarding scalability, CP gives an example: "In games, apart from player input at the front end, there is also a back end, such as map refreshes, changes in time and weather, or when a big boss dies, the small monsters will also disappear, etc. The blockchain has no back-end tasks because all executions require user interaction."

In the future, running full-chain games on Artela may become a scenario where "the Earth keeps turning without you", meaning that players design the rules and the system runs automatically.

For a blockchain that is currently struggling even with playing chess, achieving smooth interactions requires higher demands on the computing layer. "We aim to reach a hundred times that of Ethereum." Thanks to the experience accumulated in Antchain, CP added, "In fact, the current test data shows that we are already close to two orders of magnitude on the computing level."

But they do not want to replace Ethereum; projects on Ethereum can be transferred to Artela with one click. CP summarized the features of Artela: "In simple terms, if we compare the Ethereum Virtual Machine to the CPU of the blockchain, we are adding a GPU to the blockchain." In simpler terms, you will be able to play large games on the blockchain in the future.

"In the era of Internet finance, services like Jiebei and Huabei are innovations that transform from 0 to 1. Our group of people has experienced the process of turning vague concepts into concrete commercial products, and we understand the complexity behind them." CP believes that walking the same path again in the era of public chains presents many challenges, but fortunately, there is experience to draw upon.

Most of the team members at Artela come from Ant Group. "The synergy of a team of a dozen people is very high, and their work efficiency is comparable to that of a team of twenty or more." Established only a few months ago, Artela has already secured $6 million in seed funding, led by Shima Capital, with participation from A&T Capital, Big Brain Holdings, SevenX Ventures, Dispersion Capital, and Amino Capital.

Artela's testnet launched in September and is currently adopting a targeted invitation system for ecological partners. DeFi and cross-chain gaming may be the focus points for the future. CP stated that Artela does not intend to use the typical public chain strategies like airdrops, but rather wants to explore innovations with ecological applications. They will devote themselves to development in the coming months and officially launch a public test around December.

AntChain has indeed reached a ceiling in certain Web3 fields, being able to stably support hundreds of millions of daily active users. However, their activity is somewhat subtly isolated from Web3.

Just as the decentralized nature of Web3 should bring "open source" rather than "patents". Compared to the mainstream public chains of foreign technology, the non-coin blockchain ( and consortium chain ) are somewhat "out of sync" with the domestic context. Ant Chain hopes to carve out a different Web3 path in China - an open consortium chain, industrial Web3.

As early as 2017, Ant Group believed in the future of blockchain. Although the industry was not yet mature at that time, Ant had already regarded blockchain as a core strategy. "At that time, Ant said it would focus on investment, but in fact, not many people understood it; we were a very small team. After reading a lot of foreign literature and reports, I felt that this thing had great potential, especially in the context of globalization, with financial applications, I believe it is very valuable."

Jerry, the chief architect, studied the white papers of Bitcoin and Ethereum. As he delved deeper, he became increasingly convinced that blockchain is the next stage of "using technology to serve finance."

In the same year, Jiang Guofei, known as the "big brother" of Ant Chain, joined Ant Financial as Vice President and President of the Financial Technology Business Line, overseeing Ant Blockchain. The strategic position of Ant Chain within the group continued to rise. Ant Chain was gaining momentum, with applications based on the industry sector such as cross-border remittances, supply chain finance, electronic invoices, and judicial evidence storage flourishing.

In 2018, Alipay Hong Kong launched a blockchain-based cross-border remittance feature, allowing over 180,000 Filipino domestic workers to send money home without having to wait several days and pay high cross-border fees. Inclusive finance, Ant Group had already achieved successful cases early on.

CP also became a popular engineer of the company. Jack Ma mentioned CP and his widely circulated matchmaking story at the Second World Intelligent Conference.

"We have an engineer at Ant Financial who wrote on his dating profile that he is an 'engineer' and a code-writing programmer. As a result, no one opened his profile, and the girls were not interested in him. Later, he changed his profile to 'Blockchain Engineer' and received over two hundred love letters."

In 2020, Ant Blockchain announced a brand upgrade to Ant Chain. The company's senior management stated that this decision "is no less than the decision to establish Alipay."

But three years have passed, and Ant Chain, which has deeply cultivated the Web3 industry, has not welcomed a truly "Alipay" level application.

Taking cross-border remittances as an example, a relevant person in charge from Ant Group told the WSJ that there are no technical barriers to cross-border remittances, but the support for this technology varies by country’s policies and regulations, making such projects more customized. "Our cooperation with Standard Chartered Bank at that time was based on our long-term partnership."

Even during the Spring Festival, Whale Explorer, which has over a hundred million daily active users, faces issues with unsold collectibles and difficulty in breaking into new markets. Previously, the digital collectibles launched by Whale Explorer were mostly cultural and artistic items, which are hard for young people to find trendy. "But my dad likes it a lot; this is the only product I've made that he has consistently used." The work content of CP is closely watched by family, and Whale Explorer might be the easiest product for them to understand.

"Although Ant Financial is very advanced in fintech, the domestic regulatory framework mainly focuses on consortium chains. This actually removes the essence of blockchain, which is to use digital assets as a representation of value. I believe that in the future we still need to pursue the public chain path, but currently there is no soil for public chains in the country." Jerry is more optimistic about the prospects of public chains.

The alliance chain that strips away the concept of digital assets makes it impossible to talk about rights and incentives. "The alliance chain only takes on data-level matters; to truly reconstruct production relationships, I think we are still far from that stage."

"To truly run a commercial scenario, having just a blockchain is not enough. Currently, many technical supports for various stages are not in place, making end-to-end execution quite difficult. The current application scenarios actually only require a database with permission settings. If we must force a blockchain system into this, it seems a bit redundant."

CP has experience in building multiple alliance chain application scenarios. He cited the example of food traceability using blockchain technology, which is expected to fundamentally address issues such as "tainted milk powder" and other food violations.

But the reality is that no one is willing to pay for a better system. "Food traceability involves food production, overseas transportation, customs clearance to platform sales; it concerns the entire industrial chain. Everyone needs to integrate blockchain work, but by the time it reaches the consumer, the price hasn't increased a penny."

"Many companies in the industry chain are passively brought in, without consensus." Consensus is the core driving force of Web3 and the secret to achieving more with less, but the market is still far from reaching that level.

Before reaching a "consensus", consortium chains seem predictably to remain in an awkward position for a long time. Outsiders do not recognize them, and insiders do not like them.

During the Ant period, Jerry joined the public chain.