Chen Xu, vice president of meta50: digital rights confirmation is a new infrastructure for future assets

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On May 26, the 2022 yuan universe cloud summit ใƒป digital collection Summit Forum hosted by Babbitt was officially opened. At the "digital art & copyright" forum this morning, Chen Xu, vice president of meta50 and the rotating chairman of the sub Forum on digital rights confirmation and future assets, delivered a keynote speech, "digital rights confirmation is a new infrastructure for future assets". He said that digital right confirmation is a new infrastructure for future assets, and blockchain underlying technology, asset right confirmation, asset transaction and consumer applications are the four ecological structure layers of future assets.

The following is the full text of the speech:

In most cases during the development of human history, we have strengthened the efficiency of asset exchange and the process of asset formation on the basis of inherent and established asset categories, which is the main direction of our economic work. However, there are also special stages in the development of human history. In these special stages, the categories of assets are expanding, and some new assets will enter the entire trading, commercial and economic system, which is often based on the progress of science and technology and the great revolution. Now, we are at such a stage. So what we should pay attention to now is how to build the infrastructure of future assets when new assets enter.

With the continuous development of computer and Internet technology, blockchain technology is also a part of it. The main category of asset expansion in the future is digital assets. The various contents formed in the digital world in the past are just a kind of content for us to consume and communicate. However, in the new asset category, these contents can form new assets or new digital assets. Please pay attention. Yes, not yes. When your words and deeds on the Internet are likely to form new assets, you can imagine what kind of market scene and economic power such an asset category explosion will bring.

So, what new infrastructure will digital assets have in the future? I think there are four layers:

First, start from the bottom layer, that is, the bottom technology of blockchain. If there is no digital right confirmation, the future digital assets will disappear overnight like a castle on the beach. The whole new digital assets are based on the bottom right confirmation of the blockchain.

The second is how to realize the asset right confirmation based on the underlying technology.

Third, how to trade new digital assets.

The fourth is how end consumers use or trade new digital assets in various applications, even without feeling.

Let's take a look at:

1. blockchain technology bottom layer

The bottom layer of blockchain technology is mainly completed by public chains overseas, and the bottom layer of blockchain is composed of unfamiliar nodes. In the development of overseas blockchain underlying technologies, our focus is on cross chain mutual recognition, because each public chain is an account book, but we still have different public chains to choose from. How can these different ledgers get through in the process of the current explosion of asset classes? Cross chain bridge and Multi Chain technologies are under development, but we also see that the main hacker attacks in recent years have occurred on cross chain bridges. Because the stability and security of cross chain bridges can not be compared with the internal system of a single public chain, this is the first important goal we observe. In the following description, I will also divide the four layers of infrastructure into domestic and overseas to understand the differences in the market.

For the domestic blockchain underlying technology, we use the alliance chain. The trustworthiness of these trusted nodes is not confirmed by simple on chain technology, but supplemented by off chain or even off-line practical authentication, which is a feature of the Chinese market.

There are differences between the alliance chain and the public chain. Their technical composition is completely different, but whether the assets based on the authentication systems on different chains will produce different values is not certain. You can think about China's real estate and overseas real estate market. Many countries have so-called permanent property rights for real estate, while China's aboveground buildings have 70 year property rights. But have China's housing prices been affected? In fact, they have not. Therefore, within the system of a country, we adopt an authentication method. As long as this authentication method is self consistent and can provide enough credit to maintain the operation of market transactions, it has no impact on the formation and value of assets. Therefore, when the difference between public chain and alliance chain based on the underlying technology research is applied to our application, especially in the economic system, the difference will not be so great.

The underlying technology of blockchain in China mainly considers the issue of cross-border mutual recognition, because we will encounter problems when importing and exporting assets, which is also the problem to be encountered in the next regulation. Just now, we introduced the technology selection of public chain and alliance chain. When it comes to the application layer, we mainly consider whether its credit can support the operation of the entire asset system. Like the data act of the European Union and China's legislation on the gradual improvement of data, data sovereignty is particularly important. What will this have to do with the future asset trade? What rules should we follow in trade? This is a trend worthy of attention and a problem to be solved in multilateral trade. More importantly, how new asset classes, especially digital assets, are traded in multilateral trade requires new consensus and agreement among countries. China will play an important role in this.

At the same time, based on the underlying technology of blockchain, we still need to pay attention to data privacy and Web3.0 issues in the direction of supervision. Based on different underlying technology choices, it is believed that China's Web3.0 will emerge in China, and China's digital identity and China's digital decentralized value system will be established. This can be firmly believed. In addition, we can pay attention to how to ensure data privacy and how to transform from a digital twin entity with a large amount of privacy information to an entity engaged in economic behavior in the chain, that is, the trading object and trading entity in the future assets.

2. asset confirmation

Overseas, we will register the copyright on the public chain, and form a smart contract NFT protocol in the NFT, that is, the domestic concept of digital collections, but it is only a contract. A contract has its subject matter, and the assets of the subject matter are often outside the chain (not absolute, but often outside the chain). The objects outside the chain will be stored in the digital space outside the chain, that is, on another server. Of course, we will use more mainstream distributed storage, such as IPFs.

In addition to the chain, offline traditional copyright is still working. In the overseas market after the rise of NFT in recent years, the relationship between on chain registration, off chain storage and offline copyright is still in a brutal growth, such as the "western world" of new assets, that is to say, each has its own power. In addition, some people use the latest technology to register copyright. In these three cases, each system is self consistent, but do they recognize each other? In fact, the judicial systems outside Shanghai, including those in Europe and the United States, are also studying how to deal with such matters. We can only wait for one case to happen, and then see how they deal with them.

The domestic asset ownership is to register the copyright on the alliance chain, and the underlying alliance chain registers the copyright on the alliance chain, but there is also the problem of distribution outside the chain. The issue of content compliance audit of domestic assets, that is, whether the assets originally defined as content on the Internet are suitable to be issued as content in the process of its circulation and production, is subject to compliance audit. At the same time, there is also the problem of mutual recognition of offline copyright on the chain. In this regard, China has done better than overseas. Government departments have long been involved in the formation of traditional offline copyright on the chain.

At the level of asset right confirmation, the problems that should be paid attention to in supervision are the above-mentioned problems of on chain, off chain and off-line. We should realize that the so-called "irrevocability and irreversibility" in the part of digital right confirmation only exists on the chain, and how to deal with it outside the chain, that is, in the digital world, but there is no blockchain. We often hear that if we buy NFT, will the content of NFT be changed and will it disappear because of the disappearance of off chain storage, even if there are records on the chain. The contract also remembers that the house is gone, which may happen. At least for now, it must be connected. In addition, offline traditional intellectual property rights and copyrights have detailed legislation and judicial practice. We should pay attention to how these relate to the content and contracts on and off the chain.

In fact, the content of the smart contract and the subject matter mainly exists in the relationship between the chain and outside the chain, which is also the focus of attention now. How to avoid the infringement of the subject matter of a smart contract is still a difficult problem, and new methods are needed to solve it.

If traditional copyright is not combined with online copyright at the beginning of the formation of assets, or the assets are not original, then the digital assets first distributed on the chain will have problems with traditional copyright and code copyright. Numerous infringement cases have taken place at home and abroad. Just like we rush to register trademarks, there will be vicious, intentional invaders with the purpose of encroachment who will first publish on the chain, or publish on different public chains and different alliance chains. Or the original publisher's audit ability is limited, or the audit awareness is insufficient, resulting in this conflict. Such infringement conflicts occur constantly, but we can't give up eating because of choking, and we can't build new assets because of this. We should discuss more about traditional copyright and code copyright, which is also the main part of the next sub Forum on digital rights confirmation and future assets to discuss and promote industry consensus.

3. asset transaction

The overseas part of asset transaction is mainly personal second-hand transaction, which is completed by digital wallet authentication. In addition, there are transactions in legal currency overseas, but both the buyer and the seller must be authenticated by a banking institution. Please note that the certification of banking institutions actually replaces the national certification, because in European and American countries with strict supervision, a series of certification is actually required to open bank accounts. In this way, overseas financial institutions or overseas central banks have blocked the entrance from digital assets to legal traditional assets, or from digital currency to legal currency.

In China, both buyers and sellers of asset transactions require real name registration, and only legal currency transactions are recognized. In addition, we have different certification requirements for the buyer and the seller. The seller's certification is particularly strict. In many cases, industrial and commercial registration information is required. Therefore, real individuals on many platforms and individuals without legal personality cannot issue NFT. In addition, when NFT, or digital cultural and creative products, or the transaction price of new digital assets reaches a relatively high level, which may be 100000 yuan or 1million yuan (there is no clear statement at present), or an auction is conducted, in addition to obtaining the above qualifications, the certification of the deposit is also required.

Therefore, in the supervision of asset transactions, whether at home or abroad, we should pay attention to the relationship between cryptocurrency system, legal digital currency and traditional financial institutions. In the future, the three must coordinate with each other and work together. At the world economic forum in Davos currently being held, central banks are also further forming consensus to promote the digital currency of central banks as soon as possible. In this process, it is necessary to balance the relationship between legal digital currency and traditional financial institutions. Although the central bank will issue legal digital currency, it is impossible for the central bank to be responsible for the process of legal digital currency into the hands of individuals and the consumption settlement and payment system. Therefore, traditional financial institutions or the new cryptocurrency system will also be involved. What is the relationship between them? Each country has different tendencies, We should pay close attention to it.

At the same time, we should also pay attention to the relationship between CID and did, that is, the relationship between centralized digital identity and decentralized digital identity, which involves who is the subject in the new asset transaction. The centralized digital identity is connected to the online through offline citizen authentication and national authentication. But what is the relationship between decentralized digital identity and centralized digital identity after all, because a digital wallet has obtained some asset transaction rights, generation rights, or other benefit rights in the digital economic system. Back to the underlying technology, we need to balance the contradiction between how to define data privacy and how to ensure the smooth trading of new assets.

Vitalik proposed the so-called "soul binding token", or NTT, a non tradable token. What kind of connection will occur between the two? In fact, we can make new thinking along the direction of centralization and decentralization of digital identity. In the part of asset transaction, it is worth exploring and studying whether it is the subject, the object, the subject matter and the way of transaction.

4. end consumer applications

Overseas securities issuance and anti money laundering are obviously two very important regulatory objectives. In the United States, NFT or digital cultural and creative products issued by all types of securities are more and more strictly regulated, not to mention anti money laundering. However, in addition to these two points, we also need to add cross-border foreign exchange control, because this is a special case of RMB. Therefore, whether it will involve cross-border issues, as well as the bridge between fiat currency or Fiat digital currency and cryptocurrency after the strict prohibition of OTC, as well as the continuity of regulatory environment and principles, must always be paid attention to.

Finally, when it comes to the regulation of consumer applications, it actually has the following four responsibilities:

1. platform responsibilities. The platform responsibility for domestic consumer supervision is very important, and so is overseas. Of course, the responsibility of the platform is light and heavy, but the establishment of this platform is actually a division of our 4-tier future asset digital rights confirmation work. The platform is undoubtedly the most powerful party with the advantages of technology and bargaining power in this regard, so its responsibility will be more significant. Of course, in different countries, we have different judgments.

2. responsibilities of the initial issuer. For the first issuer of digital assets, it is the first time to form an asset in the market, and its significance is no less than an IPO. Although its scale may be very small, just an artist or creator publishes a picture and registers it as a non-homogeneous token, it still forms an asset that did not exist in the market. Therefore, its legal liability is far greater than that brought about by randomly sending a picture and sharing a file on the Internet.

3. secondary transaction specifications. Overseas, secondary transactions are very frequent. Just like the "western world" just now, how to regulate the secondary transaction. There are a lot of fraud and false link information on each platform, which makes the traders in the digital asset trading market bear a lot of losses. This part of the study is still lacking in foreign countries. First, the participants should be vigilant; In addition, the research also needs to be followed up. However, in China, for the protection of the transaction subject, the secondary transaction has not been opened yet. In this case, we may put legislation first and rules first.

4. technical remedies. During the two years of development, it is also difficult for a large number of engineers and scientists who have knowledge of blockchain technology not to suffer losses in the market. After we turn this market into a market that everyone can participate in, how can we avoid those artists, creators and consumers who do not know anything about blockchain technology from suffering losses in the transaction and disposal of these asset classes? In the absence of law, technical relief is very important. Therefore, there will be a lot of education and training in the follow-up meetings of our sub forum to help you understand the important role of digital right confirmation in the future asset formation and the matters needing attention, so as to help you form a certain technical relief force.

Disclaimer: This article is compiled according to the recording of guest speeches. Please correct any mistakes and omissions. Full presentation availableLive playbackใ€‚

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