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Cryptyk






Sale Starts 18 Jul 2018

Background

The growth in demand for Cloud services shows no signs of abating. As costs have been decreasing, both individuals and enterprises are increasingly moving to the cloud in order to store (or back up) their files and data.

The cloud offers enterprise-level organisations operational flexibility and efficiency, and it gives individuals the ability to share images, music and other files amongst different devices. However, all of these advantages come with one major downside as witnessed with the Sony, Yahoo and Uber hacks in recent years: a centralised model of storage and process management is inherently insecure. 

It is into this context that the new blockchain cloud venture, Cryptyk [pronounced crip-tik], has now stepped – offering what the project team claims is a new model of cloud organisation that addresses even the performance / latency issues associated with existing blockchain-based solutions offered by the likes of Storj and Filecoin. 

 

 

Concept and White Paper

Before reading through the white-paper, it is probably best to begin by exposing yourself to the proposition through the project’s so-called Overview Deck which will give a reasonably good idea of what the team is setting out to achieve in a resource that can be digested in a few short minutes. 

As for the white paper itself, there are in fact two – a business white-paper and a technology white-paper. With regards to the proposition laid out in the white papers, we have already touched up on the issues associated with a centralised model for cloud services. But the blockchain – or at least ‘traditional’ blockchain structures – do not make for a much better alternative. The problem is that, whilst blockchain consensus mechanisms add de-facto unbreakable security, they also hinder performance massively. 

So whilst blockchain storage mechanisms may make for an appropriate solution for large files which need to be accessed only very occasionally, they really do not suit users who work with a large number of smaller files which regularly need editing/modifying/updating.

One solution to this problem – that is currently being enacted by ICOs such as IPChainDatabase –  is to perform the file storage off-chain in encrypted format. A hash signature is then made of this off-chain encrypted storage file, and it is this signature which is then stored on the blockchain itself. The idea is that, when the file is next accessed, the hash signature made of the file being retrieved can be compared to the signature stored on-chain- when the signatures do not match, that indicates a security breach. 

This model is fine if your goal is to underwrite the authenticity of the contents of a file (which is the case for intellectual property, for instance). This is a scenario referred to by the Cryptyk team as data-at-rest. However, this solution simply does not work for real-time collaborations, referred to in the white-paper as data-in-motion (email, chat, payments) and data-in-use (file editing and sharing). 

There is, then, a trade-off to be made – explicitly acknowledged in the white-paper and which points to Cryptyk’s intention to create an infrastructure that sets out to achieve a market-defined optimum between security and latency that currently is not offered. 

The eventual Cryptyk infrastructure which achieves that optimum will resemble something like the following:

 

Vault

This is a set of five to ten nodes used to store files that will be provided by existing cloud storage services such as Dropbox, Amazon or Google Drive – the exact provider, it is assumed, will depend on each individual Cryptyk client. To add further security, the files themselves are sharded – essentially cut up into a smaller number of pieces, each of which is itself encrypted – and then distributed over the network. 

This component of the architecture can essentially be seen as a re-configuration of existing third-party applications to include a new Cryptyk management layer which adds blockchain-type distributed consensus mechanisms to bring a new layer of security to the existing architecture. 

Codebook

This is another private blockchain which carries the instructions required to piece together the files stored in the vault. 

Passport

Once again, this is a private blockchain, but this time its purpose to keep an audit of all transactions with the files (essentially a record of changes applied by the users to files). 

Command

This appears to be a set of tools – likely APIs – which allow various platforms (desktop browsers and mobile applications) to communicate and interact with the platform. 

Sentry

This is the core of the system which acts as the platform’s logic center, tying up the various components referred to above. 

Team

The CEO is Dr. Adam Weigold, a quantum physicist by training and graduate of Australia’s Macquarie University. Weigold also has a background in corporate finance, having overseen one IPO, two public acquisitions and half-a-dozen seed investment programs as part of what appears to have been a seven year stint at Critical Mass Investments in a corporate advisory/finance role. 

Ragu Kotha is the group’s CTO. A self-described white-hacker, his background is principally in network security and he was previously employed at Bell Labs – although this detail does not seem to appear on his LinkedIn account. 

Perhaps the most interesting profile on the team is that of Dennis McMasters, a specialist in transactional database architecture who was responsible for rolling out NYSE Euronext’s operational facilities. That’s a particularly impressive feather in the bow, and is indicative of the generally high calibre on display across the team. 

This may be an ambitious project, but it is one that appears to be managed by polished professionals with solid backgrounds and established track records. If this project has a weakness, it is unlikely to be found amongst its headline team. 

Tokenomics

Seven hundred and fifty million tokens will initially be minted, of which 33% will be placed up for sale. The remaining tokens will remain within the Cryptyk blockchain ecosystem and will serve to reward, amongst other things, independent nodes which perform standard blockchain node validation services (similar to how miners are rewarded for mining with Bitcoin). 

However, this is an enterprise solution – and as such, for Cryptyk to operate as a successful business, it cannot expect its clients to transact in CKT tokens. As such, the white-paper outlines plans for the implementation of a fiat/CKT interface where clients can simply pay upfront in USD or Euros, for example, with the platform itself performing the necessary purchases of CKT at market price on the back-end. 

 

 

Clients, naturally, will be given the option to transact in either fiat or CKT with a reduction on the fees associated with Cryptyk services if paying with the latter. The token’s economic model is otherwise simple – increasing usage of the platform implies an increase in the value of the token. 

The project soft cap is placed at $8 million and its hard-cap at $25 million. Token purchasers based in either the US or Canada will be constrained to one year vesting. No vesting will apply for purchasers based elsewhere. The vesting period applied to team payments is set at a confidence-inspiring four years [two years for advisors]. The project team appears to have an early agreement with the Bancor network to make the CKT token available in what will likely be shortly after the release of the token to token sale participants. 

Conclusion

The success of any ICO depends on a number of critical factors which no-one can judge with any certainty. Two of these are project execution and future product adoption. However, if the strength of a team can serve as some kind of indicator for eventual possible success, then the Cryptyk team certainly appear to tick that box.

At the same time, the security of the blockchain would appear to make a natural fit for cloud-based services: the cloud is a particularly vulnerable place to store anything, judging from what appears to be the almost daily accounts of hacking episodes. However, the blockchain’s introduction of latency does mean that it may not be seen as the perfect solution by everyone – something which the team behind Cryptyk itself acknowledges.

The question therefore arises: can they achieve the “market optimum” discussed in the white-paper that will offer enough of both to make the final product a mass adoption success? Time will tell. One to watch.