Disclaimer: ARK is regularly hosting Ask-me-Anything's of upcoming and promising cryptocurrency projects. Keep in mind that ARK has no competitors - only future partners.
Justin (doubled1c3) Let us all welcome the team from http://www.SwapBlocks.io - you all will be speaking with 
Let's start off with a little about you both, Brandon and Lance, how you came to your idea and explain a bit about it?
SWAPBLOCKS_Brandon Thanks Justin
tranzer Hello, are you going to wait for Ark Core v2 to be 100% stable before starting your network? What differs you from other similiar projects?
SWAPBLOCKS_Brandon We’re a blockchain protocol being built for the life-cycle management of financial assets.
Today, the financial sector has many burdensome and costly processes for issuing securities and managing their transfer compliantly. We’re creating a way to improve those processes.
Our competitors are mostly Ethereum dapps, which doesn’t allow for free market forces to govern tax costs in various markets
tranzer Are you going to introduce any new transcation types? How will you handle forging and rewards staying similiar to Ark or trying something new?
SWAPBLOCKS_Brandon They’re also focused on private securities, like equity ICOs and tokenizing funds, where we’re looking to gain our toe hold by improving processes in the institutional space. Examples would be swaps, repos, and various treasury management functions.
swapblocks_lance
Justin (doubled1c3) Are there any specific functions or features of CORE v2 that you are particularly excited about for your implementation?
SWAPBLOCKS_Brandon Increased throughput and reduced computing requirements for running nodes are going to be a great + @Justin (doubled1c3)
Particularly for routing nodes
swapblocks_lance @Justin (doubled1c3) Also the modular design of CORE v2 and the ability for delegates to deploy specific modules works well for the design of swapblocks
Tokenrock How can a tiny startup hope to sell to institutional customers? Certainly you will have to be acquired for that. Do you have a potential acquiring party in mind already?
Paroxysm Hey guys, so how are y'all going to solve the bearer instrument problem? Will it be a decentralized approach or will a centralized oracle be needed?
tranzer What about forging will it be same as with Ark and how many tokens will be in circulation?
Justin (doubled1c3) Thanks, everyone, let's let them catch up
SWAPBLOCKS_Brandon @Tokenrock that’s a great point, acquisition would likely come from a larger blockchain foundation or investment fund or a bank looking to move into the space.
However, we aren’t waiting for that and are already working to get in front of operations professionals at some of the prime brokerages and banks here in the US
Tokenrock Cool. Talking with them now can help you prioritize products and features.
Justin (doubled1c3) ^ that's a good point
swapblocks_lance @Paroxysm Bearer instruments can be held by a pseudonymous account not registered with a kyc/aml oracle just like a cryptocurrency or token. When an entity registers an asset they choice the level of verification needed to trade the asset, for a bearer asset they would choose 0
SWAPBLOCKS_Brandon @Paroxysm that’s one reason we’re targeting prime brokerages service providers. They can utilize the network for transfers without actually delivering to the end user (centralized) if needed, but as Lance said, he can also fully decentralize where regulations allow and adjust permissions over time
@Tokenrock yep that’s the idea. Plus we believe a proof of concept could be within reach if we adequately explain the benefits to the right person in the org
swapblocks_lance @Paroxysm Swapblocks mainly benefits non-bearer assets. For a non-bearer asset, lets say an interest rate swap, an issuer can join/form a consortium of trusted parties and give the asset a weight 1 permission. This means that anyone in the consortium can verify the details of the transaction
Bootlegjim (arkade_delegate) After finishing with that side, as someone who has these words flying over their heads and is not in touch with many financial categories in life (besides like personal bank), can you give an extremely short ELI5/TLDR that puts into layman's terms: what you are trying to do, why is it important, how do you plan to solve it? No jargon if possible :slightly_smiling_face: (your opener was on that same page, just want that plus a bit more)
Ray.Alva
Hey Guys,
Glad to have you guys here! I see that you guys do have an eye on low volume markets and smaller businesses. My fiancee works in Finance/Capital Markets, specifically with securities and the issuing of bonds. Where would big companies benefit by using swapblocks? (edited)
Bootlegjim (arkade_delegate) Basically if I was telling my mom what this project was about, what would I tell her? Thanks in advance
swapblocks_lance @Bootlegjim (arkade_delegate) Swapblocks is a cost-controlled platform for cross entity record keeping, specifically built for financial institutions. We intend to be the bridge between institutions so that they can trade freely with each other and minimize duplication of work, while also maintaining their custom record keeping systems in compliance with changing regulation.
SWAPBLOCKS_Brandon
https://drive.google.com/file/d/1MSHKntSOex9mjk0T1lgz0yGuyeGupiYQ/view?usp=sharing
@Bootlegjim (arkade_delegate) check out the doc I just uploaded
Justin (doubled1c3) Cool, can you give for people who may not be well versed in your target industry, an example of an inefficiency? Also, let's not forget
swapblocks_lance
SWAPBLOCKS_Brandon @Ray.Alva bonds are a great spot actually. The market is fairly opaque and heavily reliant on dealers. Using a public ledger, buyers and sellers can find each other more efficiently, securities depositories could xfer custody more efficiently, P&I payments could be automated (partially or totally as the markets mature)
SWAPBLOCKS_Brandon And dealers could use it to more effectively source inventory
End result being a reduction is cost of capital for issuers and informational risk for investors
tranzer
Bootlegjim (arkade_delegate) thanks guys! really cool idea, basically the TLDR is that everything is caught is this bureaucratic region filled with red tape that not only introduces obstacles but also introduces increased costs due to the need to navigate all the tape?
swapblocks_lance @Ray.Alva One place big organizations would benefit it in high quality liquid assets. Lets say a bank is required to have $100B in high quality liquid assets because of the Liquidity Coverage Ratio (LCR). But lets say they have $160B in high quality liquid assets. Now they could be lending out the $60B overage and earning an interest rate, but it can take years to actually liquidate those assets since it's a high quantity and there is no order book. With swapblocks a bank could swap the overage with a handful of orther banks that don't have the LCR met yet. Currently the only way for a bank to do this is to call competitors and spend months-years negotiating deals
SWAPBLOCKS_Brandon @Bootlegjim (arkade_delegate) yes and there’s a lot of duplicate work because counter parties are all using their own ledgers. So by sharing a trusted ledger on the blockchain all parties can reduce work
cam (og) replied to a thread:
In a regulated industry like so isn't it mandatory to know your customer? How will this be addressed? Sorry if answered, just got in (edited)
Justin (doubled1c3) Thanks lance, that answers my question as well
swapblocks_lance
Forging Rewards
5 SBX for the first 1500000 blocks
4 SBX for blocks 1500001 - 3000000
3 SBX for blocks 3000001 - 4500000
2 SBX Thereafter
8 Second block time
cam (og) Why? Just trying to saturate?
SWAPBLOCKS_Brandon 
Duc Will ARK hodler get token airdrop from swapblocks
SWAPBLOCKS_Brandon There’s a could other options too, just depends on how the issuers want to handle it AML/KYC for that last answer
geops How about integrating with Persona for KYC in the future?
swapblocks_lance
SWAPBLOCKS_Brandon Hey 
geops Agreed. Probably worth looking into after a year or so. (edited)
Tokenrock Will smart contracts be part of the story/implementation?
SWAPBLOCKS_Brandon @Justin (doubled1c3) yes so weigh 0 is any unregulated tx type that can be transferred freely like BTC is today. A weight 2 would be validated by a consortium, which is simply a group of nodes/entities that are collaborating and can approve txs requiring additional criteria, like KYC to be met. Weight 3 is when the issuing node is the only validation of the transaction. This could be used when data required to complete the tx is highly sensitive.
Justin (doubled1c3) Thanks everyone, let's let the team catch up to @Tokenrock and @Duc’s questions
Ray.Alva thanks for your answer!
swapblocks_lance
SWAPBLOCKS_Brandon @Tokenrock SMs will be used to govern asset an issuer deploys, but these will be “permissioned” in that the issuer can control who can run the SM and validate. For instance, a bank might not want just anyone validating their trades, so they could manage who can do that
@Duc we are planning an airdrop but haven’t nailed down who we’ll drop to
swapblocks_lance @Tokenrock also the permission-ed smart contracts run on a consortium instead of running on every node on the network as with Ethereum. This should help with scalability and securing talent, since the consortium can choice what programming language to write the contract in
Justin (doubled1c3) So it sounds like regulations in these markets tend to act as roadblocks not due to the rules themselves per se, but the efficiency and free flow of trade in the markets. Simply maintaining compliance today has a large time and money cost, and implementing new regs comes with a lot of red tape and requires a lot of people to learn and catch up to the new regs. It seems like SwapBlocks would allow these regs to exist and evolve very efficiently while at the same time speeding up the efficiency and flow of the actual trading activity. Is this accurate?
swapblocks_lance Yes @Justin (doubled1c3) (edited)
SWAPBLOCKS_Brandon @Justin (doubled1c3) that’s a great way to put it
Justin (doubled1c3) So the next logical question would be what is your strategy to get regulators to 'play ball' per se and stamp the network as being a good solution to increase efficiency?
SWAPBLOCKS_Brandon Plus by having flexible privacy levels, it can enable freer capital flows across national borders as well.
tranzer How many developers is currently in your team and are they familiar with Ark code yet?
SWAPBLOCKS_Brandon @Justin (doubled1c3) the regulators aren’t necessarily required to sign off so to speak, we’ll just be enabling them to meet those requirements in a more automated and efficient way
Justin (doubled1c3)
aha
that helps things along
swapblocks_lance @Justin (doubled1c3) Our platform will help businesses that are already having to comply with regulation do it in a more efficient way. Typically regulations around financial assets govern what documents are kept and security of customer information, and not how they are kept.
Justin (doubled1c3) So I do assume (possibly incorrectly) that at some point regulators may need to simply verify that your algorithms are showing compliance is happening, is there an easy way to show this compliance is happening without regulators needing to be code experts? Or rather, does your network provide the "results of compliance" and the users of the network simply show these clear results to the regulators?
Also let's address
SWAPBLOCKS_Brandon 
We’re hoping to bring on 3-5 more dev soon
Tokenrock Lance is full time now? Congrats!
swapblocks_lance
Tokenrock BTW
SWAPBLOCKS_Brandon
@Justin (doubled1c3) it’s possible a regulator would desire a security review or something, but I think the burden would likely be focused more on the record keeping, etc.
If the party can provide docs and to history etc they should be fine
Justin (doubled1c3)
I see, thanks! We are approaching the 1 hour mark, let's take 2 more questions
cam (og)
How many blocks could a swapblock swap if a swapblock could swap blocks?
SWAPBLOCKS_Brandon
Lol TBD
Justin (doubled1c3)
That's a great one, doesn't count as one of the two questions haha
cam (og) :joy: :clapping:
tranzer Do you have any partnerships lined up with some of those that could benefit your platform?
swapblocks_lance @Justin (doubled1c3) So our model is that the base swapblocks blockchain only keeps transaction records and data hashes, all other data, forms, etc... should be stored during transaction verification by the consortium or issuer. When a regulator comes knocking they can give them the blockchain for transaction lineage, and then dig up all other required records from their internal systems. The regulators could take it a step further and verify that the hash of the records given to them matches the data hashes on the blockchain
or vise versa
spghtzzz(ark.party is not a website) what's the difference between persona and swapblocks?
SWAPBLOCKS_Brandon
Justin (doubled1c3) Excellent, 
cam (og) Couldn't ipfs be of use oppose to that route?
Woops
Justin (doubled1c3) haha judges say... we'll allow a bonus 3rd question
cam (og) :clapping:
swapblocks_lance
SWAPBLOCKS_Brandon I think the emoji’s on Justin’s comment are fascinating
Justin (doubled1c3) I'd like to thank the Swapblocks team for joining us here in the Ark.io Slack, let's all thank them as well. As two closing questions, how can we stay up to date on Swapblocks news, and will you be releasing news on the Ark.io Subreddit?
cam (og) Thanks guys. Good luck
Ray.Alva Thanks for the insight Lance and Brandon. It looks very promising. Good Luck!
SWAPBLOCKS_Brandon Thanks Justin! You can follow up on discord at https://discordapp.com/invite/4TFTP8C
swapblocks_lance Thanks everyone!
Ray.Alva and thanks @Justin (doubled1c3) for hosting!
SWAPBLOCKS_Brandon Really appreciate it everyone!
Justin (doubled1c3) You are all welcome, expect even more AMA's in the future, and we are looking forward to watching Swapblocks grow and prosper. That's all for this AMA, forge on!
mike thanks for doing the AMA, looks like a good project.
Yellow_rubber_jacket Just read through, fascinating stuff, and good luck you guys
mike do you have link for the pre-sale and details on how it is structured?
SWAPBLOCKS_Brandon 
https://discordapp.com/invite/4TFTP8C