Smart Cities and Blockchain

We recently interviewed Jochem Verheul, Founder of  The Open Mobility Network. We explored the future of smart cities, transportation, and how blockchain technology can be used to support the future of urban living. We discussed topics such as: what is a smart city, how blockchains enable smart cities, the future of public transportation, and highly scalable blockchains. 

Why are blockchain and smart cities such a good match?

I would say three important things. First of all, there is a transaction ledger. At the moment there are many different banks and many different payment providers. It would be great if these companies and institutions were able to share their transactions on the shared ledger. For example, users would have one account for travel across any form of transportation.  

The second is opening up access to data. Currently, there are a lot of big companies who are generating a lot of data. Usually, they generate data on, for example, roads that have been built with public money. They generate data, keep it for themselves, and use it to optimize their own company. Using blockchain technology, you can create a platform to share this data. 

The third thing is that blockchain technology gives the possibility to protect the identities of people while still connecting to the bigger network. So you can operate with the big network like Facebook, for example, but without sharing your personal data.

Beside Open Mobility Network, which company are you most proud of and why?

I’m most proud of my first successful company, Itsavirus, which is an agency that develops web-based applications. I’ve been experimenting a lot with A.I. and with blockchain already for a long time. I started this company in 2009, and it still exists today. We’ve developed platforms for the biggest companies of the Netherlands like Heineken, Shell, and Miffy. All the big brands are our clients or have been our clients. It is a beautiful legacy that continues on today.

What advice would you give to students interested in tech entrepreneurship? 

So in our companies, we always had a lot of interns, and especially when somebody has a technology background, I always tell them that just start doing something. Get something online. It doesn’t matter if it’s beautiful or very functional. The important part is to get your first release online.

Inevitably some things will go bad. You might get hacked or something like that. A lot of things will happen and through that experience you’ll learn much more than you can learn in school. So just start doing, start programming something, and hope that people start using it, and make a lot of mistakes in the context of your study.

How would you define a smart city? 

It’s a city that is able to use technology to have a really prosperous, healthy, wealthy city in which technology is being used as an inclusive mechanism. Avoid technology where only the rich or tech savvy people can use technology. It’s a tool to get everybody on board, including elderly, poor people, etc. It’s about sharing data and protecting the privacy of people.

I’m originally from Amsterdam. They hired somebody as a sort of CTO of the city, and they opened up a lot of data. They are pushing really hard, especially in the field of transportant. They’re trying to push out cars and make more room for people to live, breath, play. So that’s really good. 

From a technology standpoint, Singapore is a brilliant city where they’re making progress on their bold ambitions.

How does your solution build trust and transparency in government in smart cities?

Yes. A good example is a project where we’re tokenizing a social welfare card. Governments can add tokens to the wallets of people who are eligible to travel for free. People can use these tokens to travel for free. Since it’s an open ledger, the citizens can also see where the government spends money and confirm they’re allowing poor people or elderly people to travel for free. In this case it’s about full transparency, and we can build it in such a way that it connects to the current transportation ecosystem. So users can use their current travel card.

How does your solution work with a private sector?

The private sector usually assumes that every market is a winner take all situation. However, when it comes to transportation, it’s not only an issue for the private market. Instead, transportation should be a public good, and anybody should be able to travel from A to B by the most efficient methods possible.

There is definitely some kind of conflict in there because if Uber generates all this data on the roads that have been paid with tax money, then they should open up this data. 

While a lot of companies, like Uber, claim that they are fighting congestion, if you just look at the statistics in San Francisco, it’s actually busier because of Uber. There is more pollution because of Uber, and the costs of transportation have increased.

We cooperate with a lot of public transportation companies and cities. But there is a conflict of interests because we think transportation should belong to everybody while other companies are fighting to control a monopoly. 

Where do you operate and build the infrastructure for human mobility? 

We have offices in Amsterdam and Singapore. We’ve recently open-sourced our codebase, and we’ve also switched to Cosmos which means that everything we do is open and it allows developers worldwide to collaborate. We see our project as an open version of Uber. 

What is the challenge of using your mobility platform globally?

The biggest challenge for us and most blockchains in scaling. We need fast transactions because if you check-in on a bus or on a scooter you want ‘tick-tick-pay,’ and you don’t want to wait a long time. 

However, if you want to have a fully open network, you need some kind of mechanism to make sure that it’s safe, which can slow down the network. 

We are trying to improve scalability by using the Cosmos Blockchain. Cosmos uses Proof of Stake which means we can set up a permissioned network where we assign the validators of the network. Then later we can open it up step-by-step according to our roadmap. 

Have you written your own blockchain from scratch? 

We started working on this project in 2017. Back then, the state of blockchain technology was very interesting because everybody was focused on ICOs and screaming that their blockchain was superior to the other blockchains. However, if you really start to pay attention, it’s clear that some things were just not ready at that moment. 

We need a permissioned network because we cannot fully open all the transactions because it’s part of the public transport system. We needed to protect the data, so we decided to build a lot of things from scratch. We have converted everything to Cosmos – which means we need to build some new things but it’s far more scalable and there is a great community of developers behind it as well.

How do you plan to overcome the scalability issue?

Using a concept like Cosmos, we can build dedicated platforms for each specific feature. So the transaction ledger can be super fast. A ledger where we want to share data might not need to be super fast, but the other modules need to be fast. So we can build dedicated software for each feature which allows us to have a highly performant network. Then again, if we want to operate at a really really big scale, there are a lot of challenges that we need to overcome together with our community.

The majority of your teammates are contributing to the project voluntarily. Is it sustainable?

That’s a good question and it’s a challenge for every open source project. We need to manage our project really well, incentivize everybody who is contributing to our mission, and just foster a group of people who are really happy to collaborate with each other. If we manage to do that, then it’s a very sustainable model because it has been proven many times that open source initiatives can really successful.

How will you compete with such established companies as Uber?

It’s an easy question because imagine Uber available to anybody or to any developer to build their own stuff on. I mean that would definitely beat Uber, right? That’s exactly what we are trying to build. So bye-bye, Uber.

How will the transportation economy function more effectively in a few years? 

The key is in collaboration. If companies are incentivized to share data with each other, then a journey can be planned much more efficiently. Let’s say you want to travel from A to B, both the taxi and the bus system can share data which enables the most effective route to be determined. The key is to incentivize each party to share data and collaborate which makes the whole system more efficient. 

Is trackability and accessibility of data the biggest asset generated by smart cities?

Yeah, of course. The whole concept of a smart city is closely connected to the availability of data to everyone because a 14-year-old brilliant kid with genius ideas should have access to the same data as bigger transportation companies have. If you all collaborate on solving issues which are public, then the whole idea of a smart city can really come to life. If there is no data publicly available, then creating an innovative atmosphere where people and companies collaborate on achieving these big goals will be impossible. 

How do you envision blockchain changing the world?

You have to go back in time to the Internet bubble when all the big companies arrived like Google, Facebook, Uber. What they did is build really beautiful applications that you use all the time, and they harvest data with it. So the only way to connect with these big networks is basically give away all your privacy, and they monetize your data which hurts the end user. 

Just today, it was in the news that Google employees actually listen in on the Google home device. So if you have Google Home device in your house, both algorithms and real people can spy on you. It’s  beyond imagination that we allow such a thing to exist.

Blockchain technology would allow people to interact with big networks while maintaining their privacy. In general, using blockchain technology enables us to build a very connected world in which people can retain individual privacy and safety. 

How do you think the market for the blockchain-based solutions will evolve?

It’s already booming of course, and it’s beyond the crypto hype. So you see that bigger companies have already hired people who are investigating blockchain technology. They’ve decided that blockchain is one of the bigger things along with A.I. 

On one hand this market is just beginning. On the other hand, it’s booming because people remember the Internet boom and they don’t want to miss out this time. Especially the banks who have the most to lose.  In the Netherlands, you see that many banks are involved in big blockchain projects, and I think it has something to do with missing out on the Internet bubble.

BBH Guest: Jochem Verheul, Founder of The Open Mobility Network
Jochem is a Singapore based tech entrepreneur with over 15 years of experience in building successful teams and companies. In 2017 he founded VMC, a software company dedicated to use Blockchain technology to solve challenges in human mobility. He is also a researcher at the Erasmus University, focussing on governance challenges in Smart cities. Currently bounces between Amsterdam and Asia Pacific to grow his business smoothly

Blockchain Beyond Hype is a series of interviews with blockchain experts and technology professionals from all across the globe about blockchain projects, challenges, innovations and the future of blockchain within the blockchain jungle!

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