Golem (GNT): A Deep Dive into The AirBnB of Computers

Note: This is not investment advice and should not ever be taken as if it is investment advice. These are my personal thoughts, opinions, and findings. Do your own research, invest at your own risk. I am a holder of GNT and have no relationship or connection with the Golem project itself.

Since the birth of the first microprocessor in 1971, demand for computational processing power has exploded. Over the past six decades we’ve seen . Recognizing the opportunity, tech giants like Amazon, Salesforce, Google, Microsoft, and Oracle have begun offering cloud computing services to support computational intensive applications and tasks. Cloud services provide on-demand delivery of compute power, database storage, applications, and other IT resources via the internet. Users and businesses can pay for the computational resources as needed and can avoid heavily investing in proprietary infrastructure. This is what is referred to as “the cloud” and it’s a massive industry .

While businesses of all sizes, industries, and geographies are turning to cloud services, they aren’t without their imperfections. The industry is dependent on too small of a pool of providers, prompting colossal pricing power and overlooked security risks. reported that an extreme cyber incident that takes a top cloud provider offline in the U.S. for 3–6 days would result in economic losses of $15B and up to $3B in insured losses. Cloud data is all but a treasure trove to hackers & internal bad actors in today’s data-driven economy. and there seems to be no end in sight.

On the contrary, there is hope. The advent of blockchain technology has opened the door for new opportunities to disrupt and innovate on top of existing industries, including cloud computing. Golem is one of the few projects in the cryptoasset universe looking to disrupt traditional cloud providers and offer a solution cloud’s growing pains. In this report, I dive deep into Golem’s features, mechanics, and challenges ahead. If you missed my previous deep dive on OmiseGo, feel free to check it out here.

“Every problem is an opportunity in disguise.”

— Benjamin Franklin

Table of Contents:

I. What is Golem (GNT)?II. The ProblemIII. Golem, The SolutionIV. The Application Registry & Transaction FrameworkV. So…How Does It Work? (Example)VI. The Market OpportunityVII. Rendering Farm Case StudyVIII. What’s To Like About OMG?IX. The Road Ahead (Road Map)X. Golem Brass Beta DebutXI. GitHub & TrelloXIV. The Team — So, Who’s Running the Show?XV. ICO Review & Financial HealthXVI. Competitive LandscapeXVII. Challenges AheadXVIII. Keep Your Eye on the Prize (Conclusion)

What Is Golem (GNT)?!

Website:  Whitepaper:  GitHub:  Trello: Twitter:  Subreddit:  Medium:  Telegram:

Golem is the world’s first open source, decentralized supercomputer that will offer high computational power and services to global users and businesses. The Golem network allows users (providers) to sell idle computational power to consumers (requestors) to process tasks and power applications. CGI rendering is only supported as of today, but support for informatic & computational science, chemical synthesis processing, artificial intelligence, natural language processing, mining pools, computational biology, business analytics, dApps, and more is underway. Because Golem is hardware agnostic, users can rent out their computing power even if they don’t have supreme computing capabilities.

The Golem interdependent ecosystem Computational tasks will be broken into pieces (subtasks) and distributed to providers on the Golem network, allowing for faster and more affordable computation. Although not yet implemented, both requestors and providers will build “reputation” as tasks are completed. Bad actors looking to game the system will lose reputation, resulting in the loss of deposited Golem Network Tokens (GNT) and the ability to submit/accept new tasks. Prices are determined by marketplace supply and demand, providers and requestors have the right to set their prices. Additionally, software developers will be able to publish and distribute their software as a service (SaaS) on the Golem network. This will be done by using Golem’s Application Registry. Together with the Transaction Framework, developers will have the capability to design a custom payment structure (nanopayments, per-hour use, etc.) for monetizing their software and/or applications. Like Spotify, Golem will allow software developers to gain exposure and profitably & securely distribute their work like never before. Businesses and users will also be empowered to discover new software solutions that fit their needs and budget.

Golem Transaction Framework Between Requestors and Providers/Software Developers Golem sits on the Ethereum blockchain and utilizes Ethereum smart contracts for task initiation and GNT payment settlement. Data will be exchanged between users by way of a peer-to-peer (P2P) protocol called . Golem will also utilize network stack and (InterPlanetary File System) standards for communicating and exchanging data across nodes. It’s worth noting that the IPFS protocol is a peer-to-peer distributed file system created by , the same protocol used by .

Golem’s native token, GNT, will initially be used to facilitate payment between requestors and providers, as well as to software developers. Additional attributes will eventually be assigned, but current owners of GNT either plan to use Golem’s CGI rendering application OR are speculating on future token appreciation. Because Golem is a utility token and does not return cash flow to holders, I will refrain from estimating GNT’s intrinsic value on a cash flow basis like I did for OmiseGo.

Although Golem intends on becoming a one-stop solution for compute specific tasks, the long term vision is to provide bulk-rent machines for operations within a self-organizing network. Golem could one day be a platform for powering microservices, allowing anyone around the world to run both small and large applications faster and more affordable than ever.

The Problem

Cloud spending isn’t slowing down anytime soon. According to , cloud adoption was up big for all providers from 2017 into 2018; AWS increased adoption from 57 percent in 2017 to 64 percent in 2018, Azure increased from 34 to 45 percent, and Google Cloud increased from 15 to 18 percent. While cloud has seen meaningful growth over the years, concerns around cost and security have yet to subside.

• Security is a challenge for 77 percent of respondents, with 29 percent seeing it as a significant challenge.
• Managing cloud spend is a challenge for 76 percent of respondents, while a smaller 21 percent see it as a significant challenge.
• Optimizing cloud costs is the top initiative again for the second year in a row for all cloud users (58 percent), which is an increase over 2017 (53 percent).
• in public cloud costs per year, due in part to complex and dynamic pricing packages, user’s variable cloud spend, and higher regional costs.

Cloud users prefer to use more than one cloud provider

Golem, The Solution

Because Golem will aggregate and cross buyers and sellers of idle compute power, a market will form. In theory, this will result in lower prices relative to existing computing solutions . When you consider the profit margins earned by cloud providers, (arguably ~40/50% when excluding new capacity costs), it’s evident there is ample room for prices to fall further. The ability for users to set a prices for a particular task or application will eliminate wasteful spending too. If a user has a task they need completed right away, a premium can be paid to initiate and accelerate computation. If a user has some time to kill, they can offer to pay below market.

Assuming Golem’s task batching process is in fact quicker than peers, users can also to save time when running a task/application. Golem’s ability to take a task, break it up into sub-tasks, and distribute it out to providers is what makes computations faster. It is also what makes Golem revolutionary from a technological standpoint and amongst its peers. Don’t forget, time is money.

Not only will Golem save user’s time and money, but also provide superior security. With computations taking place across several users on a decentralized P2P network, no single point of failure exists. No one single user will process a task or hold all the data associated with a task. Economic incentives and “reputation” will ensure that tasks are successfully executed. All data transmissions between parties will be encrypted to obfuscate inputs and outputs when communicating across Golem. Lastly, because the Golem network is made up of , the risk of technical malfunctions and/or power outages shutting down the network is nil.

The Application Registry & Transaction Framework

The Application Registry and Transaction Framework are among the most important features of the Golem ecosystem. They both enable anyone to publish their applications on the Golem network and ultimately decide which transaction model they prefer. Both are designed to put power in the hands of developers and mold a more efficient, transparent, and secure community. The Application Registry is simply an Ethereum smart contract that is published on Ethereum when a developer integrates their application on Golem. The registry will hold basic info about the developer and their application. Anyone can use the registry to confirm an application is trusted (whitelisted) or not trusted (blacklisted). Through the registry, developers will have a way to publish their integrations, reach out to users, give requestors a place to look for specific tools fitting their needs, and give providers full control over the code they run. On the other hand, the Transaction Framework will be used by providers and developers to set the price and payment mechanism in exchange for their computational power and/or application. The transaction mechanism must be entered into the application registry, use an open source and/or deterministic environment (Ethereum Virtual Machine), receive community approval, and use GNT. Transaction frameworks include, but are not limited to, nanopayments, off-chain payment channels, per-unit use of software (per-hour, per-node), etc.

So…How Does It Work? (Example)

Lisa is a special effects artist and often uses an online rendering service to render her work. She recently heard of Golem and decides to give it a shot. Drew runs a data center business and own both a high-end gaming PC and an old Macbook Pro. Kyle runs a software company and makes applications in his free time. He built a rendering applications that is similar to Blender, but different in a few ways. He publishes his application to Golem and the app is whitelisted. Drew works non-stop, he rarely has the time to use either his gaming PC or Macbook during the week. His data center business is also relatively young and he still has some idle computing capacity available. Drew discovered Golem last week, as well as Kyle’s rendering app. He decides to rent his PC and Macbook’s processing power to users who want to use Kyle’s rendering app. Drew even decides to use his idle data center capacity at work to connect to Golem. Lisa decides Kyle’s rendering app is most suitable for her project, so she creates a new task by uploading her rendering file. She then sets her desired resolution, frame range, format, and folder to output her rendered file. Once specified, Lisa sets her task timeout, subtasks amount (how many subtasks to break the task into), and subtask timeout. Lastly, she submits her desired price (in GNT) for completion of her rile and then submits it to the Golem network. Drew, alongside 9 other providers, are matched with Lisa’s task and the Ethereum network initiates subtask distribution to providers. Drew and the other 9 providers start rendering Lisa’s image using Kyle’s application. Once all providers are done rendering, the subtasks come together to complete the rendering, and the Ethereum network will validate final result. After validation, GNT is exchanged between Lisa, the providers of her task (including Drew), and Kyle.

The Market Opportunity

It has been estimated by that HPC (high performance computing) alone will be a $45B market by 2022 and will grow at a CAGR of 7% from 2017–2022. On the other hand, estimates the worldwide public cloud services as a whole could see $411B in revenue by 2020.

The cloud services business is far from a winner-take-all market. Consumers vary in size and needs; no one person or business is the same. As both the market and Golem evolve over time, opportunities for Golem to take market share will arise. Existing cloud service providers are bound to face hiccups along the way that may result in customers questioning whether they trust such service (think and ).

Not only that, but businesses and users have even shown to use 5 cloud service providers on average, a growing trend amid a growing industry. Even a minuscule market share of 1%, or $4.11B in 2020, would make for a considerable amount of network activity on Golem.

Rendering Farm Case Study

Magdalena Stasiewicz, a tester for Golem, on the cost of using Golem vs. other rendering farms for a Blender rendering task. Magdalena used an electric energy consumption meter to measure energy intake (cost) of running Cornerstone Centre, a 100 frames of an animation by , and the . She then compared Golem’s cost (using 1 desktop and us 100 desktops) to complete the task and compared it other rendering farms. The results were convincing. Although the price of tasks will be determined by market supply/demand dynamics, this shows us that Golem can achieve superior performance and generates a hefty consumer surplus for requestors. The difference in cost and speed is shown below:

Time (min) and cost ($) of rendering Cornerstone Center on different render farms, on regular desktop and on Golem (with 1 and 100 regular nodes).

Time (min) and cost ($) of rendering Gooseberry benchmark on different render farms, on powerful desktop and on Golem (with 1 and 7 powerful nodes). We have not included results for Render Spell: this farm is inexpensive but at the time of this test the waiting time was counted in days (much longer than desktop time).

The Road Ahead (Road Map)

History has shown that truly innovative technology always takes longer to develop, costs more to fund, and is frequently doubted before officially coming to market. Despite Golem having been around for quite some time (~2.5 years, or 250 years in crypto-years), the innovative efforts and challenges Golem is taking head on are easily some of the biggest in the crypto world. Patience is a virtue…

The team’s road-map was published in the November, 2016 whitepaper release. The road-map is a great visualization of all that has to be accomplished and speaks to the action taken to deeply understand what they the team is up against. The road-map lays out codenamed Golems (Brass Golem, Clay Golem, Stone Golem, etc.) for every successive milestone. Each Golem has a set of technical innovations for the overall network development, as well as a detailed “go-to-market strategy” that highlights objectives and value propositions. An updated road map is scheduled to be released around the end of 2Q18.

Golem Project Timeline (November 2016)

A brief overview of each codenamed Golem is as follows:

Brass Golem — Proof of concept stage where CGI rendering is up and running. This phase of the road-map is where a plethora of core functionalities of Golem are added, such as basic Task Definition Scheme, IPFS integration, basic UI and CLI, basic reputation system, and implementation of Blender.

Objectives: Create a user-base of requestors for CGI rendering and attract a matching supply of computing power (providers).

Clay Golem — The introduction of Task API and Application Registry to make Golem a multi-purpose, generalized distributed computation solution. At this stage developers will have the means to integrate with Golem and can begin defining simple tasks. Clay will also introduce the initial transaction framework model, basic subtask delegation for more fine grained subtask distribution, support for virtual machines, and tutorials for developers who want to implement their own task for Golem network.

Objectives: Broaden the user-base of requestors by adding new use cases, attract and retain a matching supply of computing power, and stimulate first experimental independent integrations with Golem.

Stone Golem — Security, stability, and improving existing functionalities are core focuses. Stone will also introduce an updated version of Task API and the Application Registry will be complemented with a certification mechanism to build a trusted network for apps. The transaction Framework will allow for the SaaS offering to be implemented in this stage as well.

Objectives: Stimulate first wide-scale independent integrations with Golem, retain and broaden the user-base of requestors by facilitating marketing efforts of independent requestors & promote existing use cases.

Iron Golem — A deeply test Golem that has been deployed and proven to be robust, highly resistant to attacks, stable, and scalable. Various tools for developers will be introduced to make application creation easier; Golem Standard Library (Golem STD) will be implemented to provide access to the low level core components required to interact with Golem from within a programming language. Other key functionalities that will be included are Golem web client, Golem developer toolkit, advanced transaction system, provider dashboard, devp2p integration, and MapReduce.

Objectives: Stimulate successful and innovative integrations with Golem.

Golem Brass Beta Debut

On April 10th, 2018 the Main Net and Golem Brass Beta was officially launched. The release was long awaited and reinvigorated the excitement and long-term vision of Golem. Support is live on the Ethereum Main Net and users can now earn/spend real GNT for rendering using Blender. Blender is a free and open source 3D creation suite that supports modeling, rigging, animation, simulation, rendering, compositing and motion tracking, even video editing and game creation. The team plans to implement support for various other image rendering software in the eminent future.

Those who are interested in becoming more familiar with Golem, or want to sell/purchase computational power, head over to the download page and click “Download Golem”. It’s suggested to first familiarize yourself with the Testnet before moving onto the Main Net. Download link, documentation link, and a video tutorial for submitting tasks are below.

Download: Installation Documentation:

The Proof Is in The GitHub & Trello

For those who want to inspect Golem’s source code, or get a better sense for how development is tracking, you can find the latest on their . Under the “insights” tab, it is evident the team is grinding away. There are anywhere from 20–80 commits being pushed each week. Distribution of contributors is favorable, no one single contributor makes up the majority of commitments and there appears to be a true team effort. Golem’s board is also useful for visualizing the team’s progress, activity, and current focus. To give a better insight into how active the team is relative to peers, we can compare a few GitHub stats. If we look at GitHub stars, which are used to indignant repository appreciation and future reference, we can see that Golem currently sits at #10 among its peers. This is a great metric for better understanding the popularity, following, and appreciation that a particular project owns.

Data Source: OFX We can also analyze where Golem stands relative to its peers in terms of number of commits in the past 90 days & the past year. This is another insightful way to better understand dev activity. As we can see below, Golem takes #7 over past 90 days and #9 in the past year. A respectable ranking to say the least.

Data Source: OFX

Data Source: OFX

The Team — So, Who’s Running the Show?

It is often forgotten that great success comes from great people. When investing it’s imperative that one is considerate of a multitude of things — price relative to intrinsic value, strategic positioning, financial positioning, business model, catalysts, etc. Most neglect the notion that the right team can be the difference between a and a zero. This is especially true in the highly human capital-intensive crypto world.

**Transparency & Engagement**Golem is incredibly differentiated on the basis of the team’s responsiveness, transparency, thoughtfulness, and innovation alone. They’re constantly publishing on their Medium blog, updating their GitHub repo, posting on Trello, and are incredibly active on the subreddit. AMAs (Ask Me Anything) are hosted on Reddit every couple of months and are great resources for getting your questions answered and learning more. You can read the December edition , February edition , and April edition . It’s the small things that give investors and users confidence in the murky crypto world, it’s these practices that keep the support and engagement alive. Cryptoassets backed by quality management teams and an active & supportive community are destined to earn a premium over time.

“Without execution, ‘vision’ is just another word for hallucination.” — Mark V. Hurd

Track Record & ExperienceThe team behind Golem has an existing track record of successful collaborative software development, proving their ability to execute and deliver a viable product. Both Julian Zawistowski​ (CEO) and Andrzej Regulski​ (COO) have experience working together on consulting projects and business endeavors since 2008. In 2013, they both left IBS, a Polish economic think-tank, to create a consulting software development team called . The Golem project would later spin out of imapp and become a full time endeavor. The team is composed of talented developers with a multitude of experiences and skill sets making them capable of such delivering a decentralized P2P computational platform.

• CEO and Founder of Golem since December, 2016.
• CEO and co-Founder of imapp since August, 2013.
• Worked at The Institute for Structural Research (IBS) from 2006 till November, 2012. Remains Chairman of the Foundation Council.
• Graduated from Warsaw School of Economics in 2004 with a MA in Economics.

• CTO and Co-Founder of Golem since December, 2016.
• Senior Lead Developer at imapp since July 2014.
• Holds a MSc in Mathematics and MSc in Computer Science​ from the University of Warsaw.
• Programmer with experience working on P2P technologies, NVidia’s CUDA parallel computing platform, digital cinema mastering encoding technology, and The Witcher 2 among many others.
• Implemented core components of Golem prototype and leads the design of Golem protocol and its preliminary use cases.

• COO and Co-Founder at Golem since December, 2016.
• Managing Director at imapp since October, 2013.
• Evaluation Program Director and Project Manager at The Institute for Structural Research (IBS) between January, 2008 and September, 2013.
• Holds a MA in Economics from Warsaw School of Economics.
• Passionate about managing people and improving organizational efficiencies.

• Lead Software Engineer and Co-Founder at Golem since December, 2016.
• Lead Software Engineer at imapp Since August, 2014.
• Software Engineer & Deployment Specialist at Red Ocean from January, 2013 to July, 2014.
• Graduated from University of Warsaw with a MSc in Mathematics and BSc in Computer Science.

• Lead Ethereum Engineer at Golem since December, 2016.
• C++ Software Engineer on the Ethereum Team since November, 2014.
• C++ Software Engineer at imapp from July, 2012 to December, 2016.
• Pawel is the creator of EVMJIT project and also a contributor to the LLVM and C++ Guidelines Support Library.
• Received a MSc in Computer Science from Wroclaw University of Science and Technology.

Wendell Davis

• Special Adviser to Golem Network.
• OmiseGo Product Designer.
• Ethereum founding team member.
• Some of his past endeavors include Hive, one of the earliest easy-to-use Bitcoin wallets, Vizor, an open source WebVR development platform, Splice, an online music making/mashup community, and Kitchensurfing, which connected mobile chefs with buyers of their trade.

ICO Review & Financial Health

On December 2nd, 2016 Golem successfully completed an initial coin offering and raised $8M in proceeds. Of the total 1B GNT created, 820M GNT was sold in exchange for 820,000 ETH. The remaining 180M GNT was retained by the team and Golem Factory GmbH. Golem’s 18% of GNT supply allocated towards the Golem Team and Golem Factory GmbH is relatively in line with initial coin offerings and it speaks to the team’s desire to be financially incentivized, but not conflicted. Just as important, the ICO had a strict hard cap on amount of funds raised, thus preventing an inflated network value, concentration of token ownership, token flipping, and misaligned incentives.

Budget structure for maximum financing Although Golem raised $8M in ETH, Ethereum’s appreciation since the initial raise impels a $615M raised on the basis today’s price of Ether ($750). Although is currently held, we can turn to to examine the genesis Golem contract and better understand overall financial health. Needless to say, Golem has enough capital on hand to keep afloat.

Despite the fact that Golem was way ahead of the curve when they launched their ICO, they’ve benefited more from the broader crypto market appreciation than had they done an ICO a year later. Golem’s holdings of Ethereum positions them well into the distance future and opens the door for M&A/capital investments to accelerate development. Sometimes, things just work…

“With ETH appreciation we can afford to increase the scale of such efforts. On our side, a potential partner has to fit at least one of the following profiles: 1) a strong focus and experience in a technology which could speed up or enhance the development of core Golem elements, 2) a business case with a big potential to integrate with Golem as a source of computing power.” -Piotr Jesiotrzyk, CTO and Co-Founder

Competitive Landscape

While Golem may be offering it’s own decentralized P2P cloud computing solution, there are a handful of others working to provide a similar offering. Although not pure player competitors, projects like iExec, Gridcoin, and SONM have overlap with Golem and are worth being cognizant of.

A Lyon, France based project building a decentralized cloud infrastructure to provide computational power for dApps. The iExec team believes blockchains offer very limited computing capacities to run decentralized applications and plan to fill that void. Computations will be run off-chain and will allow traditional cloud services to be run in a new fashion within its decentralized network, while also being enhanced by the Ethereum blockchain. The iExec team was originally involved in establishing the European Desktop Grid infrastructure, a distributed system that uses the collection of computer resources from multiple locations to allow nodes to perform a different task/application. Once they discovered Ethereum, they saw the ability to use it in conjunction with desktop grid computing to disrupt the world of cloud, big data, an high performance computing (HPC). Any machine can become a “worker” and join a worker pool to perform distributed tasks, completion of such tasks are rewarded in RLC tokens. iExec is different from Golem in that they’re focused on requestors, or dApps creators. The project also plans to take a different computational approach, leveraging off-chain computation. iExec has yet to launch their MainNet and remains a “wait-and-see” project in the meantime.

Website: Whitepaper:

Gridcoin is an open source blockchain that mints and distributes cryptocurrency to those contributing their processing power to the BOINC computational infrastructure. The Berkeley open infrastructure for network computing (BOINC) is an open source computing infrastructure that performs data analytics projects by utilizing contributor’s GPU and CPU power. BOINC has been the engine behind numerous computationally intensive research programs, such as pulsar identification, the creation of patient specific cancer treatments, and the simulation of candidate molecules for next-generation solar panels, among many others. All data analytic projects are approved through a selective whitelist process.

BOINC Project Manager UI Gridcoin is similar to Golem in that anyone can be rewarded for their idle computational power. For that reason, those looking to rent out their computational power may decide to do so on the Gridcoin network if it’s a more profitable offering. A switch of providers from Golem to Gridcoin could potentially result in a shock to supply on the Golem network, resulting in higher prices and uninterested requestors. On the flip-side, the two differ in that no marketplace exists for the sale and/or purchase of computational power. As mentioned before, all projects have to go through a whitelist processes and nearly all of the projects running on the BOINC infrastructure. Gridcoins cannot be used for purchasing computational power. At first glance, the process for syncing the GridCoin client to the BOINC project manager is lengthy, confusing, and unclear.

Website: Whitepaper:

SONM is a worldwide general-purpose computing platform and is perhaps most similar to Golem. SONM allows for personal computers and data centers to be rented by customers for powering various applications — rendering, machine learning, web hosting, scientific calculations, back-end for managed data storage devices, large scale development. SONM utilizes to perform Consumer’s tasks and Ethereum smart contracts for task execution and enforcement. Docker is an open source tool that can package an application and its dependencies in a virtual “container” that can run on any Linux server. This means Docker can take an image (an executable package that includes everything that is needed to run an application) run it inside of a container using someone else’s computational power, and the customer can then interact with the application. For instance, say you want to play a game on your PC but you do not have the hardware capabilities to run it. You can package the game into an image, pay for computational power to run it in a container, and then play on your own personal computer. Contrary to Golem, SONM only has a MVP (minimum viable product) TestNet live for customers and suppliers to familiarize themselves with. Only task images that are can be run on MVP for now, but additional capabilities in production. SONM is most different from Golem in the technical approach they’re taking to provide decentralized P2P computing.

Website: Documentation:

Challenges Ahead…

Golem is undoubtedly one of my favorite cryptoassets to date. If you have a reputable track record and are looking to solve a real problem by way of an original solution, I’m all ears. While Golem’s effort to go from is intoxicating to witness, innovation isn’t without its risks. Golem has its fair share of challenges ahead that bring into question long term viability and likelihood of adoption.

**The Value Proposition**When competing for market share there are a few different ways to come out on top. Some compete on price, some compete on better efficiency, some compete on differentiated features/functionalities. Whatever it is, any cost one incurs as a result of switching to your good/service must be offset — there must be a value proposition. For example, consumers eliminate the need for continuous capital expenditure on infrastructure, open the door to new tools and functionalities, and no longer assume operational and security risk when switching from an on-premise legacy solution to Amazon Web Services. These perks vastly outweigh the time and headaches that will come with transitioning to AWS.

Golem’s value proposition lies within leveraging its network of requestors and providers to provide lower prices and faster computational speeds. Said competitive advantage will only be realized if there are enough providers and requestors to drive market equilibrium. Desired applications and software must be available if Golem wants to attract, retain, and increase user activity. Furthermore, Golem’s functionalities, features, and user experience needs to be on par, at the very least, with existing computational services to users. Things like a simple user interface, , guaranteed security & confidentiality, and reliable customer support must exist. If these do not exist, they’re costs. If these costs are too high to keep providers and requestors on the network, they’re gone and so is Golem’s value proposition.

**Likelihood of Adoption**At the end of the day, Golem is a cryptoasset. The world of cryptoassets remains nascent, difficult to understand, misunderstood by both the general public & institutional investors, stuck in the “infrastructure stage”, and_VOLATILE_. Before we can expect Golem to see large adoption, it’s fair to say the broader crypto world will need to see some adoption of its own. It’ll take time, an effective marketing campaign, , further development, and meaningful partnerships to exist before one can expect a ramp in adoption.

**Limited Functionality**Although the launch of Golem Brass Beta and Main Net was a grand slam, the only illustrative use case today remains CGI rending via _. In_dustry standard software like Autodesk Maya or 3Ds Max are not supported and GPU support for rendering is not yet available. However, according to Golem’s “integrating other rendering software is going to be relatively easy. We have already initiated contacts with the companies behind some major commercial rendering software.”

**Reliance on the Ethereum Network**Golem depends on Ethereum to scale, optimize, and offer gas-efficient micropayment channels in order to truly realize full functionality. Since micro payments are required to facilitate task execution between the receiver and various number of providers, if gas costs are too high then providers will not have the economic incentive to offer their computing power. Because Golem is an ERC20 token deployed on the Ethereum blockchain, Golem is directly exposed to the risks and potential setback of Ethereum (governance issues, increasing competition, faulty monetary policy, PoS implementation failure, scaling issues, hacks, etc).

**Reliance on Emerging File Sharing Technology**Although Golem plans to use a series of promising emerging technologies like IPFS, devp2p, libp2p, and Swarm for P2P file transfer, these are in fact new and emerging technologies. Just as with Ethereum, Golem is directly exposed to the risks, hurdles, and limitations that these nascent technologies present.

Privacy of Computational Results Computational subtasks are currently NOT confidential and confidentiality will not be introduced anytime soon. Golem is aware that this diminishes network trust and limits the number of use cases for requestors, but the team . Despite the fact, implementing a confidentiality feature is a BIG hurdle that Golem must overcome in order for core use cases to exist and be trusted. Although the batching process of tasks obfuscates the project in totality, there is no guarantee that a provider couldn’t observe a vital part of the task by pure chance.

Golem’s partners from ITL are working on support for computations using Intel’s SGX technology. This technology, also known as Software Guard Extensions, allows partitioned areas (also known as ‘enclaves’) in memory to protect select code and data. Because this is hardware security solution, an attacker with full control over the desktop endpoint will not be able to access the protected enclave of information. Fascinating technology, you can read more .

**Stiff Competition Among Tech Giants**Although the competitive landscape is minuscule amongst other cryptoassets, Golem is still going toe-to-toe against the most innovative, powerful, and well established businesses on the globe. The tech behemoths have plenty of levers to pull and deeply understand the value in retaining customers by making their platforms sticky. They’re constantly looking to own customer loyalty, deeply integrate themselves, and make the cost of switching astronomical. Even if we assume Golem will take the originally planned 8 years to develop, plenty could change in 8 years’ time that could hinder Golem’s full potential.

The Unknown UnknownsIt’s expected that any new technology or product is going to have an initial proof-of-concept, we all start somewhere. However, Brass Golem was originally scheduled for released in 1H17 and the Beta was only just released last month. This lag can be attributed to unforeseen challenges and circumstances that the team faced. Golem has undoubtedly set sail in uncharted waters in search for a new gold, with that search comes setbacks. If Golem continues to find itself consistently setback and unable to bring itself to market, the likelihood of the network ever gaining meaningful adoption could approach zero. The network needs enough requestors and providers to truly shine, but a lack of either-or would be catastrophic. Lack of users could ultimately push the network into a recursive loop of user departures and slowing speeds/rising prices.

Keep Your Eye on the Prize (Conclusion)

Fan or not, no one in their right mind can refute the fact Golem is pushing the envelope to bring to market some pretty incredible and revolutionary technology. Although biased, Golem is one of the few truly differentiated projects across all crypto verticals and it possess an incredibly asymmetric risk/reward to the upside. That’s not to say that setbacks wont emerge along the way or that Golem is still incredibly young. But, those who are patient and willing to keep their eye on the prize may certainly witness the birth of a new global network and revolutionary technology.

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• Pete