After "graduating" from Ant, they flock to Web3

Two technology revolutions that are highly anticipated in the tech industry are AI and Web3. AI is expected to reshape productivity, while Web3 is anticipated to transform production relationships.

In the tech world of 2023, there is almost heavyweight news every day; it is the year of generative AI and also the year of deep bear market for Web3.

In 2023, the total financing for Web3 was only $3.6 billion, a decrease of 78% compared to nearly $16 billion in 2022. In contrast, the AI sector saw financing reach $25 billion in the first half of the year. One of the largest venture capital firms in crypto, Paradigm, has undergone a paradigm shift, stating that it will no longer focus solely on cryptocurrency and the Web3 space, but will also expand its areas of interest to AI.

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

But it must also be acknowledged that this deep bear market in Web3 seems to be more lively than before. In the bear market, some still discuss compliance, ZKP (Zero-Knowledge Proof), and Bitcoin ETFs. There are also those who choose to enter the market at this moment.

"When I communicate with colleagues at Ant, I often draw comparisons between AI and Web3, as their development trajectories are quite similar." Jerry Li compared, over the past sixty years, there have been three waves of artificial intelligence, with funding reaching billions to hundreds of billions each time, alternating between peaks and troughs, until OpenAI emerged. "This new large-scale technological revolution requires several cycles to truly bring about leapfrog development."

Jerry Li once had several prominent titles: former chief architect of Antchain, former director of R&D for Apple China, and top scorer in the college entrance examination in Shanxi Province, and now he has another one------a newcomer to Web3.

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

"The industry is still too early, and compared to AI, it hasn't reached the previous stage of development. Currently, the total market capitalization of the entire cryptocurrency market is still less than half of Apple's market capitalization." Jerry feels that compared to his former company, the Web3 cake still seems too small.

Of course, compared to AI that has been around for over fifty years, Web3 seems to still be in its adolescence.

The concept of Web3 was first proposed in 2014, while its predecessors, the concepts of "cryptocurrency" and "blockchain," were first released in 2008 through Satoshi Nakamoto's "Bitcoin Whitepaper," which is only 15 years ago.

Rebellious and unstable, Web3 is going through a period of growing pains that makes "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 officially went All in on Web3, launching the public chain project Artela. He stated that he would not consider doing anything else in the short term. When asked about the reason, Jerry quoted a famous saying from Ant: "Because you believe, you see."

The Artela team has chosen the public chain track, which is part of the Web3 infrastructure, also known as the "highway" of Web3, as there can be no transport of all things without a road.

In the public chain track, there are long-established Web3 pioneer projects, such as Ethereum, which has already built its own moat through the "network effect" of its ecosystem, and there are also several all-star projects that were born with a golden key.

Nowadays, choosing a more crowded track, the WSJ. talked with Jerry about his views on "first mover advantage."

"Although there is a lot of competition in the public chain market, it is still far from perfect and there is still a lot of room for improvement." Recently, Jerry has been traveling around the world for meetings, which is his first step in adapting to his new identity. After a round of discussions, he found it very rewarding. "After communicating with many projects, our confidence has actually increased."

The biggest difference between Artela and other chains is not the current "involution" of Scalability (performance scalability), but rather Extensibility (functional scalability), and it is compatible with EVM (Ethereum Virtual Machine), allowing developers to transfer applications with one click.

This is to prepare for the future of Mass Adoption.

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" issue. However, the core of the problem is quite clear: how can we enable ordinary people to use Web3?

The "Ant Gang" in the internet era is the architect of Mass Adoption. In their context, Mass Adoption is more about building another "Alipay" in Web3.

Of course, it is full of experience. Artela's CTO Qiu Honglin (alias: CP) previously provided underlying architecture support for Ant Group's digital collectibles platform Whale Exploration. He stated that Whale Exploration had already achieved over one hundred million daily active users through its New Year 'Five Blessings' event. "At that time, we had already achieved stable on-chain transactions at the billion-level, while Ethereum was only at several million. From a certain perspective, it can be said that Ant Chain has truly reached Mass Adoption."

CP was once an OG of the Ant Chain team. He joined the initial form of Ant Chain in 2015, which was still a small interest incubation group at that time.

"They say that if someone in Ant Group wants to talk about blockchain, by the time they ask the second person, my name is definitely mentioned." CP has slightly curly hair and speaks with a hint of a Cantonese accent, often making it feel like a casual chat, but upon closer listening, the content he expresses is very professional and detailed. Ant Chain holds the largest number of patents in the world, and CP personally holds hundreds of blockchain patents.

Regarding Extensibility, CP gives an example: "In games, besides player input at the front end, there are also back-end processes, such as map refreshes, time and weather changes, or when a big boss is defeated, the smaller monsters next door will also be eliminated, etc. However, there are no back-end tasks in blockchain, because all execution in blockchain must be through user interaction."

In the future, running Fully On-Chain Games on Artela may turn into "The Earth Keeps Turning Without You," where players design the rules and the system runs automatically.

For blockchain, which currently finds it somewhat difficult to play board games, achieving seamless interaction requires higher demands on the computation layer. "We want to achieve a hundred times that of EVM." Thanks to the experience accumulated in AntChain, CP added, "In fact, current test data indicates that we are already approaching two orders of magnitude on the computation level."

But they do not want to replace Ethereum; projects on the Ethereum chain can be transferred to Artela with one click. CP "abstraction" summarizes the features of Artela: "Simply put, if we liken the EVM to the CPU of the blockchain, we have added a GPU to the blockchain." In simpler terms, large games can be played on the blockchain in the future.

"In the era of Internet finance, products like Jiebei and Huabei are innovations that went from 0 to 1. We have all experienced the process of transforming a vague concept into a concrete commercial product and understand the complexity behind it." CP believes that taking the same path again in the era of public chains presents many challenges, but fortunately, there is experience to reference.

Most of Artela's team members come from Ant Group. "A well-coordinated team of a dozen people can achieve progress similar to that of a team of twenty or more." Founded just 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 currently, it adopts a targeted invitation system for its ecological partners. Defi and Fully On-chain Games may both be focal points for future developments. CP stated that Artela does not intend to engage in the typical airdrops and routine combinations seen in public chains, but rather wants to explore innovation with ecological applications. They will focus on development in the coming months, with a formal public test planned around December.

It can steadily run hundreds of millions of daily active users, and without a doubt, Ant Chain has already reached the ceiling in certain areas of Web3. However, their activity seems to be subtly isolated from Web3.

Just as the decentralized nature of Web3 should bring "open source" rather than "patents". Compared to the mainstream public chains in foreign technology, the non-token blockchain more suitable for the domestic context, also known as alliance chains, has a certain "mismatch". AntChain aims to pave a different path for Web3 in China, focusing on open alliance chains and industrial Web3.

As early as 2017, Ant had already believed in the future of blockchain. At that time, although the industry had not yet taken shape, Ant had already regarded blockchain as a core strategic focus. "At that time, Ant said it wanted to invest heavily, but actually not many people understood it; we were a very small team. After looking at a lot of foreign literature and reports, I felt that this technology still had great potential, especially in the context of globalization, where it could have financial applications, which I think is particularly valuable."

Jerry, who serves as the Chief Architect, has been studying the white papers of Bitcoin and Ethereum. As his research deepens, he increasingly believes that blockchain is the next stage of "using technology to serve finance."

In the same year, Jiang Guofei, the "big brother" of Ant Chain, joined Ant Financial as Vice President and President of the Financial Technology Business Line, overseeing Ant Blockchain. Ant Chain's strategic level within the group has been continuously elevated. Ant Chain is gaining momentum, with cross-border remittances, supply chain finance, electronic bills, judicial evidence storage... Applications based on the industrial end have fully blossomed in a short time.

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

CP also became a viral engineer for the company. Jack Ma mentioned CP during the second World Intelligent Conference, along with his widely circulated matchmaking anecdote.

"We have an engineer at Ant Financial who wrote 'Engineer' on his dating resume, as a coder, and as a result, no one clicked on his resume; the girls weren't interested in him. Later, he changed his resume to 'Blockchain Engineer,' and received over two hundred love letters."

In 2020, Ant Blockchain announced its brand upgrade to Ant Chain, and the company's executives stated that the decision "is no less significant than the decision to establish Alipay."

However, three years have passed, and Ant Chain, which has been deeply involved in the Web3 industry, has not welcomed a truly "Alipay"-level application.

Taking cross-border remittances as an example, a relevant person in charge at Ant told the WSJ that there are no technical barriers to cross-border remittances, but the support for this technology varies by the policies and regulations of each country, so such projects are closer to customization. "At that time, we were collaborating with a certain bank, which was already our long-term partner."

Even during the Spring Festival, the whale exploration app, which has over a hundred million daily active users, faces issues such as unsold collectibles and difficulty breaking into new markets. Previously, the digital collectibles launched by whale exploration were mostly cultural and artistic products, which are hard for young people to find trendy. "However, my dad likes it a lot; this is the only product I've ever made that he keeps using." The work content of CP is very much of interest to family members, and whale exploration might be one of the easiest products to understand.

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

The alliance chain that strips away the concept of digital assets makes it impossible to talk about rights confirmation and incentives. "The alliance chain only undertakes data-level aspects; to truly reconstruct production relationships,