Introducing iFi, Infrastructure Finance Deborah Simpier Althea
Introducing iFi, Infrastructure Finance Deborah Simpier Althea
Towards a Definition of iFi iFi, Infrastructure Finance, is a new market segment that applies the principles and mechanics of distributed systems to the funding and ownership of infrastructure. In this post, we share some initial thoughts about what iFi is, what its precedents are, and what it means for the future of infrastructure.
From: Roger W, CC-BY-SA 2.0 Like DeFi (Decentralized Finance), which encompasses distributed, composable, and programmable financial tooling, Infrastructure Finance applies the smart contracting, finality, and secure, distributed consensus of blockchain technology to the funding and operating of infrastructure and utilities.
Permissionless: Composable systems, seamless integrations and native interoperability. Enables free and open markets. Trustless: Removes the brittleness and friction of manual coordination. No more middlemen or trusted third parties. Programmatic: Introduces dynamic and automatic methods for the funding and routing of utilities. Mitigates payment latency. Get paid for your service and operations minute-by-minute, instead of on 30–60 day cycles. Monetize in new ways, via automated micro-transactions. Transparent: Mitigate risk and enable more exploration, diligence, and collaboration for everyone. iFi Revolutionizes How Infrastructure is Funded, Built, and Used Infrastructure is the foundational and fundamental mechanism for how humans interface with society and the environment. It is water pipelines, sewage systems, food production, transportation networks, energy grids, and telecommunications. It must be reliable and performant, as every system of human and machine coordination relies upon it.
Today, infrastructure is largely funded, built, and operated via centralized, government-orchestrated mechanisms because its construction and management require a great deal of trust, capital, and coordination. But centrally-operated systems carry the risk of a single point of control and the brittleness of a single point of failure.
Small communities are particularly underserved by centralized networks that privilege cities, and we often see them develop distributed systems to address the vacuum of available and open infrastructure. These communities coordinate projects that range from a single well or grange that serves a few dozen people to thousand-member-strong farming or electrical co-ops. Whatever the size, these projects are built with the philosophy that being a user of infrastructure must entail being a participant in that infrastructure.
As such, it’s often mistakenly assumed that participating in a cooperative always entails shared ownership of that entity. This perspective clings to the cooperative systems of the past, in which one resource was owned and managed collectively. Though this organizational framework is still relevant in some settings, it does not take into account how distributed systems enable disparate entities to cooperate without the need for unscalable human-to-human trust. This is the space in which iFi appears to reshape how we fund, build, and coordinate infrastructure.
iFi Decouples the Ownership of Infrastructure from the Services It Provides But iFi doesn’t come out of nowhere: open-access infrastructure is an obvious precursor to the application of blockchain and distributed systems to infrastructure. Often seen in telecom, open-access design decouples the ownership of infrastructure from its services and management. Ultimately this introduces the possibility of systems in which one entity can own the infrastructure while another provides and manages its services (such as bandwidth and customer service).
For example, Ammon, Idaho has some of the lowest rates for bandwidth in the USA because its fiber optic cable is owned by the municipality while the bandwidth and services running on the fiber are offered by a variety of providers operating in a free market driven by user choice.
Althea’s telecom stack is another example of an open-access telecom system. Similar to Ammon’s fiber optic cable schema, Althea decouples any infrastructure or hardware from its service entity or network operator. This allows many entities to fund and own underlying infrastructure, while other entities provide, manage, and sell the services.
Althea thus opens up novel mechanisms for understanding the maintenance, funding, trading of utilities and infrastructure. iFi describes the emergent markets, token economics, and use-cases that will arise as a result of the decoupling of physical infrastructure and service layers.
iFi Privileges User Choice, Reinvigorating Infrastructure Markets User choice is crucial to open-access systems, and it’s vital for iFi. The competition introduced by new, free, and open markets leads to a reduction in the overall cost and quality of service.
Ammon, ID portal User choice should be baked into infrastructure and utility interfaces. In Ammon, users can choose a bandwidth provider via a service portal. Althea abstracts this one step further: a user can set their preference for cost or quality of services, and the price-aware routing protocol programmatically routes their traffic appropriately. Because of technological innovations like this, future Althea users will be able to roam freely, across grids, with their devices automatically changing carriers at a moment’s notice in order to meet their needs and preferences.
iFi emerges as an exciting and timely market segment alongside the rise of software-defined systems of decentralized consensus and coordination. Blockchain and other distributed technologies enable the trustless, permissionless orchestration of multi-entity networks, opening new markets and encouraging growth and robustness in vital infrastructure categories like energy, transportation, and telecom. In future posts, we’ll take deep dives into other aspects of iFi, and how it sets new precedents not only for the funding and ownership of infrastructure. It’s time for iFi.
Come Build With Us! Are you building in the iFi space? We are actively looking for builders and projects to take part in an upcoming iFi whitepaper. Contact us at [email protected].
Hackathon: Build new telecom and infrastructure applications Discord: Join our community Learn More about how Althea works: website, docs Participate as a validator Launch an Althea network: Hawk Networks Infrastructure Blockchain Telecom 50
iFi (Infrastructure Finance) is a new market segment that applies blockchain technology to the funding and ownership of infrastructure. iFi is permissionless, trustless, programmatic, and transparent, and it revolutionizes how infrastructure is funded, built, and used. iFi decouples the ownership of infrastructure from the services it provides, and it privileges user choice, reinvigorating infrastructure markets. iFi is an exciting and timely market segment that enables the trustless, permissionless orchestration of multi-entity networks, opening new markets and encouraging growth and robustness in vital infrastructure categories like energy, transportation, and telecom.
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