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August 11 2017

ICO Alert Report: Fluence

ICO Alert Report: Fluence

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Pre-sale Information
The pre-sale will begin on August 9, 2017 at 1 p.m. UTC. The pre-sale will sell FPT, which are exchanged for Fluence tokens (FLU) at a rate of 1 FPT:1 FLU after the crowdsale has been completed.

There are a total of 6,000,000 FLU tokens available during the pre-sale and the bonus structure during the pre-sale is as follows:

1 Ether = 1,500 FPT (if contributing less than 5 Ether)
1 Ether = 2,250 FPT (if contributing between 5–100 Ether)
1 Ether= 3,000 FPT (if contributing over 100 Ether)

There is a minimum contribution amount of 0.5 Ether and the FPT tokens are not tradable until they are converted into FLU after the main crowdsale. In order to participate, go to the Fluence ICO page on their website, click “Join Pre-ICO” and you will be required to submit an email and a range of what you wish to invest. The team will contact you via email with more information on how to contribute when the pre-sale opens.

Crowdsale Information
Due to the unstable market situation, SEC regulations and so on, the team does not yet have an exact date for the crowdsale. The team is aiming for Q4 2017.

The Fluence ICO is an Ethereum based crowdsale. The contribution address will be posted once the crowdfunding period has begun.

There are a total of 45,000,000 FLU tokens available during the crowdsale. One Ether contributed = 750 FLU tokens.

Token Distribution Information
Fluence tokens (FLU) are an ERC-20 token that is distributed via an Ethereum smart contract. Any FPT tokens acquired during the pre-sale will be exchanged into FLU tokens after the crowdsale has been complete. The current crowdsale date has not yet been announced, but the team is aiming for Q4. Expect more information from the team about the crowdsale as Q4 approaches.

It is important to note that there is another token, Fluence Functional Token (FFT), that runs on the internal Fluence blockchain and is used as a reward for those running nodes. The price of the token is set at roughly $1, so that those who are running nodes for the network do not have to worry about volatility.

Allocation
There will be 100,000,000 FLU tokens created with no growth rate:

-6,000,000 will be distributed during the pre-sale
-45,000,000 during the crowdsale
-20,000,000 will be held in reserve
-20,000,000 will go to Fluence team members
-9,000,000 will go towards an ecosystem fund

The ecosystem fund will be used to incentivize participants and FLU holders, to run development hackathons and other marketing contests, and for aggregating and distributing dividends from Fluence commissions for FLU token holders.

Use of Crowdsale Proceeds
The Fluence team states that the funding raised through the crowdsale will be used for development purposes, for building a storage ecosystem and for partnerships.

Team
Evgeny Ponomarev
Evgeny is an entrepreneur and product manager who is highly passionate about blockchains and machine learning. He built the 2GIS Dialer mobile app that at one point processed more than 65 million calls per month. He is in charge of project management for the CodeFest developers conference every year (1,500+ attendees/year).

Dmitry Kurinskiy
Dmitry is a software engineer and tech lead. He skills lie in software development and team building/management. For the last year, he has been building a private trading platform, both streaming & handling (~1k points/sec on a single commodity) and historical (>10Tb/commodity) of live data. His interests lie in distributed systems, functional programming, and stream processing.

Alexander Demidko
Alexander has experience as a distributed systems engineer and has a strong understanding of computer science, game theory and machine learning. At Metamarkets (an SaaS programmatic data company), he built a petabyte scale analytics platform capable of processing hundreds of billions of events per day.

Social Media
Twitter: https://www.twitter.com/@FluenceAI
Telegram: https://t.me/FluenceAI
Bitcointalk: https://bitcointalk.org/index.php?topic=1960104.0

The above ICO information can be found on the Fluence website or in their business paper.(1)(2)

What is Fluence?

Fluence is both a decentralized database and an open data market. By bringing together both those who are looking to purchase data and those who are looking to store data, Fluence aims to create a better database and data exchange using blockchain technology.

The database component of Fluence works like a traditional remote database in that it allows you to query data, update/delete data privately, etc. However, it also holds the following advantages over traditional databases:

  1. Fluence is fault tolerant and censorship resistant. Due to the decentralized nature of Fluence, it guarantees a maximum uptime and no possibility for data regulation. Fluence automatically balances data replication to keep all data online.
  2. Fluence is incredibly private. Data is split into chunks, encrypted and stored on different nodes that are controlled by different hands, allowing for the utmost privacy. There is no way for a node-owner to spy on data or steal it unless the owner of the data gives them their private key.
  3. Fluence is low cost. By compensating users for their unused storage space, Fluence brings larger storage capacities to market, which decreases the price of storage and allows others to utilize the unused storage space.
  4. Fluence manages access well. Fluence provides a flexible permissions management model based on proxy re-encryption technology that is compliant with HIPAA, GDPR, HITECH, PCI and other key regulations. This allows data owners to grant unique permissions to data users for only portions of their data.
  5. The “open data market” component of Fluence brings an easy to use web-based solution for uploading data, managing datasets and sharing access permissions or selling data. Anyone can upload and sell their data or purchase data from others. Fluence aims to provide the platform, but believes many third party data markets will also emerge due to the efficiencies Fluence brings, as detailed above.

Fluence aims to support both the cryptocurrency community and traditional industries. For example, Fluence discusses the importance of privacy and access in the healthcare industry. Allowing for some portion of patient data to be sent to scientists would allow for scientists to focus solely on research versus privacy compliance practices. The Fluence team imagines decentralized applications and machine learning/AI projects requiring storage space as they grow, while also requiring privacy over the valuable intellectual property within the projects.

The Fluence Token
The Fluence ecosystem will use two types of tokens: tradable and functional tokens. Tradable tokens (FLU) are strictly used to represent shares in Fluence. This will allow the cryptocurrency community to participate in the success Fluence has with their project. Functional tokens (FFT) are needed to maintain operations within the Fluence network. Unlike FLU, which is an ERC-20 token issued on the Ethereum blockchain, FFT is issued on the internal Fluence blockchain. FFT exists to reward users running nodes that provide storage, perform internal operations and secure the network. FFT is continually issued and transferable with a pegged price of roughly $1 to ensure node owners are not subject to any market volatility.

How does it work?(2)(3)

The Fluence ecosystem incentivizes those with extra storage space to run a node on the network, while offering fault tolerant storage for data owners looking for better access management options and faultless security that traditional storage may not provide. Each node is a part of a larger cluster of nodes that is responsible for some dataset. Each cluster maintains its own “cluster blockchain” and other node clusters will act as arbiters to verify that these node clusters are accurate. This format allows for greater scalability, as it doesn’t run into latency (data transfer delay) issues or big block size when running one large blockchain for all nodes. To ensure communication between node clusters is secure, a cryptographic key pair (one public and one private key) is used. Identification of some communication between node clusters comes from the public key, while the private key is used by each node cluster to sign (re: verify) the authenticity of the communication.

All internal operations are recorded as transactions on the blockchain. These transactions are stored and verified by those users running nodes, who are rewarded with FFT for performing these operations. Detailed specifications of the FFT working with the node clusters can be found in the Fluence technical paper.

When a client looks to join the Fluence ecosystem, a storage contract will be created and funded with FFT tokens. This storage contract allows the client to communicate with the node clusters and perform the desired operations. The minimum amount of storage is one gigabyte and the minimum amount of time for storage is one month.

Once the storage contract is created, nodes will continue to ensure that the data is accurate and exists in storage. Every hour, all nodes verify the storage of clients’ data and receive an FFT reward for doing so. If the nodes do not complete this, or act in error, the reward will not be issued, so nodes are incentivized to maintain their cluster blockchain. As clients’ look to give data access to other parties, they are able to select which portions of the data will be accessible and can even charge a price for access if desired. A “sharing contract” is created with all of these parameters, plus an encryption key generated by Fluence. The third party is given a re-encryption key that gives them access to all or certain parts of data, based on the way the data owner has set up access to that specific data. This varied data access for third parties is completed by creating a “tree” of private encryption keys that can give a third party access to certain layers of data, but not the full encrypted data. Once this, or any, operation is completed, it will be timestamped to the blockchain once nodes have completed the verification process.

Roadmap(2)

The following roadmap is provided by the Fluence team:

Proof of Concept
Decentralized database that stores encrypted data, queries encrypted data and connects any node to the network. The Fluence Proof of Concept will allow anyone to store data in the decentralized encrypted database, query it and manage their access as they desire. All operations with data will be timestamped to blockchains after nodes have consensus. Any node will be able to join or leave the network at any time.

Short-term
Implement node clusters and arbiters, storage contracts and sharing contracts.

Mid-term
Implement node incentivization for storage and operations, as well as FFT token implementation gateways for users.

Long-term
Implement a centralized data marketplace and machine learning processes.

View the Fluence Website here.

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Disclaimer: This report is intended to provide market intelligence. This is not investment advice and does not constitute any solicitation or endorsement of any investment. Any investment you make is done at your own risk and at your full and absolute discretion. The contents of this report are the property of ICO Alert. All rights reserved.

References
(1) Fluence Website, Fluence, (2017)
http://fluence.ai/

(2) Fluence Business Paper, Fluence, (2017) https://drive.google.com/file/d/0B07gyODhPstQWjVLMlkyVjRZVE0/view

(3) Fluence Technical Paper, Fluence, (2017)https://drive.google.com/file/d/0B07gyODhPstQNzFoZHBoVFdyMzA/view

Topics: Blockchain, Data Storage, Bitcoin, Ethereum, ICO