Max Kordek is a 24-year-old Bitcoin wiz from Germany. Next week he and his co-founder, 37-year-old Oliver Beddows, will launch their company, Lisk.
And Lisk is such an exciting idea that during their 30-day crowdfunding campaign, nearly 4,000 people chipped in a total of $6 million in bitcoin to fund their seed round, Kordek tells Business Insider.
Lisk is two things: a new kind of app store, and a a new form of internet money, similar to Bitcoin.
An app that never goes down
First and foremost, Lisk is a new kind of app store built on the same kind of technology used by Bitcoin to keep track of who owns how many coins.
That’s a technology known as blockchain, which the tech and financial industries are going gaga for.
In simple terms, blockchain is a distributed database, an app that is replicated on many, many machines that keeps track of transactions.
In practice it means that Lisk will also use many different clouds, Kordek says.
“There are many different servers. Some might be at Amazon, some might be at Google or Digital Ocean and many other hosting and server providers. And developers can install Lisk on their own servers and their computer participates. This is what makes the network,” he says.
All of this means the app store can never go down, Kordek says.
But there’s a few other things this app store will do. Security and privacy are built in. It won’t be able to mine users’ data, letting people keep their data private.
Instead, the app store will focus on paid apps. Lisk will take a fraction of each financial transaction that takes place.
For instance, if a developer builds an app that lets coffee shops sell cups of coffee by subscription, every time a customer uses the app and money changes hands, Lisk takes a tiny fraction of the Lisk coin that changes hands.
A new kind of internet coin
Second, Lisk is a new kind of internet money, similar to Bitcoin. All forms of this kind of internet money are called “cryptocurrency” and while Bitcoin is the most famous and most valuable, there are currently 100 of them listed on CoinMarketCap, a site that tracks the value of such currencies.
Kordek had to build a new cryptocurrency in order for the financial exchange part of his app-store network to work fast enough to run an app.
“Bitcoin is very slow. You have to wait 10 minutes for every transaction. Our own network, with our own cryptocurrency, you have to wait 10 seconds,” he says.
In fact, its crowdfunding campaign sold off the first batch of Lisk coins.
Kordek believes that many of the people that invested were less interested in the app store, and just “speculating on” the price of the new coin, he says. That’s what happened with a cryptocoin called Ethereum, he notes.
That’s the second most valuable coin after bitcoin. Ethereum was also launched via a crowdfunding campaign in 2014. Today a single Ether is worth $14 and Ethereum has a market cap of $1.1 billion.
Lisk also made another promise to investors. The $6 million worth of Bitcoin raised was put into escrow, meaning the cofounders can’t touch it to hire people or pay for bills until they launch their app store and network.
“The money is locked up. I’m running on our savings and I’m 24 years old, so my savings are not unlimited,” he says.
Lisk founders never met
Kordek and Beddows got the idea for Lisk from the Crypti Foundation, the previous company where they worked, which was developing a similar kind of app store.
Kordek lives in Berlin. Beddows lives in the UK.
“It’s strange but we are somehow always on the same page, have the same opinion about things, we just understand ourselves so well. It’s crazy,” Kordek says.
Since Crypti was releasing all of its code as open source software, Kordek and Beddows took many parts of the Crypti’s code as a basis for Lisk.
Their decision to go out on their own apparently caused a bit of a firestorm in that part of the cryptocurrency world. But in the end Crypti announced on its blog that it was winding down the project anyway. Its founders said they supported Lisk and would soon be turning the project over to its community of users to use and update as they pleased.
Their history caused another odd situation. Despite working together for years, the two cofounders have never actually met in person.
“We will actually meet at the end of May beginning of June. We will go to an event hosted by a big venture capitalist, and meet the first time. We thought about creating an office in Berlin but he has a wife and I have family as well, so we decided to stay decentralized in the spirit of our network,” Kordek says.
The history of Crypti demonstrates that Lisk, as a company, is still a long shot.
But this idea that the next generation app store will be built on blockchain, whether by Lisk or someone else, seems increasingly likely.