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Changing the world, blockchain by blockchain

by Judd Wilson Staff Writer
| October 9, 2018 1:00 AM

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Lawrence Sowell and Travis Jank show off Krambu’s new blockchain power distribution unit at their R&D lab in Coeur d’Alene. (JUDD WILSON/Press)

COEUR d’ALENE — Imagine a world without the internet, without smartphones, without wireless technologies. The world of the 1980s was a clickity-clack world of typewriters, ringing phones mounted to walls, and cords stretched like trip hazards across kitchen floors while kids waited for commercials to be over so they could watch cartoons.

The technological changes of the past decades have made 2018 far different. Workers make calls on phones that fit in their pockets, cooking parents access recipes from online catalogs, and kids stream videos that used to be controlled by movie theater execs, Blockbuster clerks, and television network programmers.

Just as the world has changed in our lifetimes due to technological advancements, the world may change yet again thanks to the emerging technology known as blockchain. You may have heard of its famous cousin bitcoin and a host of other cryptocurrencies. They became famous overnight when their values shot up toward the end of 2017, reaching a high of more than $20,000 per bitcoin last December.

Bitcoin and other cryptocurrencies are like skyscrapers that attract the attention of passers-by, but they can’t stand without solid foundations, streets, and other public works infrastructure undergirding them. That infrastructure is blockchain. Just as streets and infrastructure undergird everything from schools to homes to skyscrapers, blockchain may soon undergird everything from your health care records to your bank accounts to your cryptocurrency wallets.

Coeur d’Alene has its own blockchain innovators at Krambu. Don’t let the name fool you. Krambu isn’t short for anything. It has meanings in two different languages, but essentially it’s just a memorable way to remember the unique work Krambu does: making the world’s best blockchain hardware.

Coeur d’Alene High School class of 2006 alumni Travis Jank joined forces with Oregon transplant Lawrence Sowell to create the company in 2017. They already had decades of experience in entrepreneurship, computers, and blockchain under their belts. Jank set world records for building the world’s fastest computers, servers, and workstations. He has consulted for Intel, Invidia, Microsoft, AVD, and other major players. Sowell has started up businesses since he was 18 years old. He also runs Codera, an app development company, and has been in the tech space for more than a decade.

When Jank and Sowell formed Krambu in 2017, they established that transparency would be one of the company’s core values. There’s a lot of misinformation about blockchain thanks to the hype surrounding cryptocurrencies, Jank explained.

“It’s not bitcoin that matters, it’s blockchain that matters,” he said.

Krambu chief information officer Ben Meyer said, “Blockchain is like the freeway, and cryptocurrencies are most of the semi trucks on the freeway.”

Blockchain works in this way: Imagine a single ledger that contained every transaction consumers in Kootenai County had made in 2018. If a hacker could alter that ledger, the hacker could profit from wreaking havoc on others’ records. But what if every consumer in Kootenai County had an identical copy of that ledger on his own device or computer? What if the past transactions could not be changed, and the future transactions would be invalid, if a hack was identified? The sheer difficulty of hacking into all of those devices, and altering all of those ledgers, at the same moment, undetected, is what makes blockchain so superior to legacy systems, Jank said.

“The processing power required to forge a transaction on the network is the sum of all the processing power, all the computers, all the internet connections, and all the infrastructure” needed to do the hack, he explained. “The cost of that is massive.” The only entities that could pull off a hack like that, Sowell said, and get away undetected are nation-states.

“The most powerful governments will have the most powerful blockchains,” he said.

That’s why 86 percent of all blockchain-related research and development is being funded by governments and companies worth more than $3 billion. Another 8 percent is being funded by companies worth between $1 billion to $3 billion. Only 6 percent is being funded by small players in the market, Sowell said.

So far governments are playing catch-up with the quickly-evolving world of blockchain and cryptocurrencies.

It’s been like the Wild West, said Jank, which isn’t necessarily good for the technology’s growth. People and companies don’t feel comfortable adopting the technology.

“Regulation needs to be drafted with close communication and work with those that are fundamental in the blockchain and cryptocurrency space,” he said.

But because blockchain solves problems of security, reliability, and trust with all forms of electronic communication, Jank explained that blockchain “will revolutionize technology” in the way that the internet protocol suite TCP/IP did. Blockchain will be adopted by existing companies and integrated with existing technologies “to provide cost savings, and to increase performance and security.”

For example, banks and governments will adopt blockchain to replace their legacy systems, Jank said. Once that happens, it’s not going to change the dollar bills or credit cards you carry around, but the blockchain technology will lead to cost savings, mitigate fraud, theft, and counterfeiting, he said.

Krambu’s founders had been involved in blockchain long before last year’s bitcoin hype, and they want to one day become what IBM, Microsoft, and Apple have been to the world of personal computing. That’s because they don’t just make stuff to speculate on bitcoin or to take advantage of thirsty investors. Like Steve Jobs, they’re out to make the world’s best blockchain technology — beautifully.

Krambu builds hardware for enterprise-level companies. Everything they build, they design and build from scratch right here in Coeur d’Alene. Krambu’s staff comes up with solutions, writes patents, builds prototypes, and does integration, testing, and assembly here at its R&D lab on Government Way. Once the hardware is internally validated, it’s shipped to the Krambu data center in Newport, Wash., for additional field testing, Sowell said.

“We’re one of the first companies in the blockchain space. We build it first and make sure it works” before shipping it out to customers, Jank said. Most other blockchain hardware companies don’t do that, he said.

Jank distinguished between companies that focus on cryptocurrency, and those that deal with blockchain.

“Blockchain companies are few and far between,” he said, though noting that in the aftermath of the 2017-18 bitcoin surge, many cryptocurrency companies rebranded themselves as blockchain companies. There’s a difference between traders trying to turn a quick buck and innovators engineering real blockchain technology, he said. Sowell and Jank hope that energy consumption issues can be addressed with regional power companies, many of whom don’t know the needs and benefits of blockchain.

The Krambu staff works on designing and building the technology that blockchain will need 10 years from now.

“Our mission is to do tough stuff,” Jank said. “It’s motivating to look at a problem and solve it.”

The Krambu team wants to build up Coeur d’Alene as a high-tech hotspot where innovators can live, work, and change the tech world.

“It was my dream to stay here. I worked so hard and took odd jobs just to survive, to stay here near friends and family, and be close to the outdoors,” Jank said.

“We believe in the technology. Our hearts and minds are in the right place. This isn’t for getting rich quick. This is to enable blockchain for the masses.”