The possibilities that you can do with blockchain are potentially endless, as Nodle’s interesting developments show. With the Nodle Cash App, the platform effectively creates an ecosystem that integrates blockchain, cryptocurrency and the internet of things. Joining in this conversation with Monika Proffitt, the company’s founder and CEO, Micha Benoliel eloquently explains how the whole ecosystem works and what possible directions it can take. The platform is set to enable users to make purchases using Nodle Cash, setting the stage for greater possibilities that have the potential to change the digital ecosystem as a whole. Join in as Monika and Micha geek about what could become the next revolution in digital technology.
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I’m here with Micha Benoliel of Nodle and Nodle Cash App. Micha, thank you so much for joining us.
Thank you for inviting me on your show.
I was glad that we got introduced to the wonderfully massive, yet small world, blockchain space. It’s been nice to get to know more and more wonderful innovators in the blockchain space. Thank you for taking the time. I know you are in the middle of a big push and it’s a busy time at Nodle. I would love to start with, what is Nodle? Why did you decide this had to be made in the world?
We are building a wireless mesh network. We believe we are probably already now, one of the largest wireless mesh networks on the planet. The way we achieve that so quickly is because we rely only on software. It’s a unique and innovative way of building wireless networks. What we do is we push an app, the Nodle Cash, but also a library when we partner with app developers, that when you have this app on your phone, imagine your phone becomes a hotspot for IoT. When you have this app on your phone, any sensor, any device, any appliance in proximity can use your phone as a way to connect to the internet. We are replicating the original model of the internet. When the internet started, you had universities starting to spark servers, and then interconnecting the servers, which was the beginning of creating the giant internet. That’s what we do at the individual level. Any individual who has a smartphone can be part of this network, and share the access and connectivity with devices, sensors. The great thing is there is a blockchain and crypto component to it because we wanted to incentivize people to participate. When you joined another network, you become a node in the network and you generate a cryptocurrency called Nodle Cash.
When the internet first started, there had to be hardware built to be able to then run the software that would connect to these computers in different locations and create the internet. Now that we have so much hardware, like our phones are always right here, we can leverage the fact that there’s already hardware built and simply only install software that then has an incentivizing feature to reconnect people through wireless technology.
We use the smartphones who already have a radio antenna, we have to leverage these capabilities of your smartphone and to basically turn it into a hotspot or the base station to connect anything.
I was in Ecuador several years ago and I was checking with this app and I put it down. I had a drink at the bar. I was waiting for my flight. Next thing I know, my phone has been hacked and there are messages sent out in Chinese or in some Asian language. I was like, “My phone is hacked. I don’t know what to do.” Somebody was able to connect through my device and into my device, and then use it in a way that I couldn’t control. I had to hard reset it. I didn’t know what else to do. I shut it down until I was out of the airport. I got my flight and I left. I was like, “I hope my phone’s okay.” It was, but I didn’t know what happened. I noticed that when I downloaded the Nodle Cash App now, because I was so curious and I wanted to learn all about this for our conversation, I noticed that the first thing it says is, “We take your privacy seriously.” What are you doing to enable this kind of connectivity through something as personal as a phone that doesn’t make it end up getting hacked or something? What is the privacy layer there?
First, contrary to many mobile applications who are trying to monetize your personal data or your information, we are not interested in all of that. We don’t want to know who you are, we don’t care. What we are interested in is leveraging your capacity as a node to connect things. First, we don’t ask you to sign up. You can just download the app, no signup process. We randomize the identities of the nodes so that way, we will never be able to know who you are because we randomize that identity. We do all these things as light as possible on your phone, and focusing on the purpose of connecting things, because that’s what we want to do and that’s the whole mission. When you have this app, you can be rewarded for moving data. If you are familiar with Bitcoin and the process of mining with Bitcoin, in Bitcoin when you participate and you mine, you create and generate Bitcoins by solving a complex equation. It’s called process of mining and proof of work.
With Nodle, we created another proof of work, which is called proof of connectivity. It is based on the amount of data that you move, the value of the data that you move based on many factors. Also, if you are the only one who is able to move the data at a given time in a specific location. All these parameters are taken into account to generate the coin and reward you with this coin. What we love about that idea is, to mine Bitcoin, you either need it to be an early initiative developer who is close to the original people who created Bitcoin or the early adopters to have a chance to mine Bitcoin. If you want to mine Bitcoins, you’re going to have to join a large pool to be participating. It’s already almost trusted by probably ten big organizations who controlled these big pools of miners. The beauty with Nodle is anyone with a smartphone can access that and participate, and be able to remotely mine this cryptocurrency here.
Your explanation helps me understand what was happening with my phone because while I downloaded it and I saw it, I was like, “My cash app is zero. What do I do?” It’s not like Sweatcoin where I walk around, and I earn Sweatcoins by walking. I saw packets moving, something was telling me a ratio of reward. I didn’t understand what the actual ratio of reward was, but then I opened it back up and I realized, I have 0.000039 Nodle cash. I was like, “It was about the packets.” Now, there are no packets being moved, so nothing is changing. I don’t know when something changes it or doesn’t, but I noticed that I’m clearly doing something with the network. I’m not sure exactly what. It’s like I’m losing battery fast. It’s almost like it doesn’t make any difference to me, I just happen to earn passively.
The goal is to create, for you, those sources of revenues. You don’t need to do much to access it, but it leverages the capacity and capability of your smartphones to achieve that. I like to compare it often to Pokémon GO. Sweatcoin is also a good example, but with Pokémon GO, you can go out, have to chase Pokémons. That’s what’s happening with Nodle cash. You move around and as you pass by sensors or devices that need to connect to the internet, your node will connect to these devices and enable the data to flow to the internet. Indeed, if you stay in the same place, you are probably going to generate little rewards. If you move with your phone or if you go into places where you have a lot of electronics or appliance or sensors, then you have more chances to move more and earn and to be rewarded more.
This would be the perfect app for somebody who is underpaid at Best Buy, they work at Best Buy, but they’re always around electronics. They’re walking around all the time, and this gives them extra.
Some staff or employees at Best Buy run the app. They generate more revenues than anywhere else.
We need a #BestBuy in this one, because that’s your new target user base, the underpaid electronics department. I’ve noticed that there are two avenues that innovators take to end up in this nexus of cryptocurrency and blockchain. We talk with different innovators that sometimes they have a blockchain application and there’s no crypto components at all. They’re using distributed ledger technology because it’s making it better, it’s working better. To de-centralize something sometimes works much better. Sometimes there’s a crypto layer as well.
There are some projects that started with the crypto layer like Tokenomics or the Cryptoeconomics. They’re like, “It’s great technology, where do we apply it?” This roaming person looking for the place to put it. Which one for you was the beginning? Did they come as a married combo in your mind or did you see it as, “I want to make this mesh network? How can I incentivize people to participate?” Did it come up with, “How can I get people passive, easy, mine-able income that doesn’t create a hierarchy of entry point? How do I find the right application for a mesh network?” Which way was that?
It’s a combo. To have the cryptocurrency and the blockchain is a way to ignite the network, because if you want to have presence on smartphones, sometimes it can either cost you a lot of money in marketing to bring awareness about your app, or if you work with app developers, they can charge you to have your library running on their app. It can be costly. Now, we have 20 million participating smart phones. It’s 5 million to 6 million daily active nodes in the network with smart phones. We discover or connect to 30 million IoT devices a day. Sometimes we spike to 80 million devices. All that, we were able to make it happen, thanks to this new economic model. There is first a necessity to build this kind of network, this new ecosystem, a new economic model. There is the fact that we believe it could be the beginning of a UBI, so Universal Basic Income. That’s something that I appreciate. It’s great for the future.
There is more to that, also for when it comes to the business logic, ultimately we started to build a network, now we have most of the control of the network, but how good is it to decentralize that network and make it completely independent like the internet is independent? For that, you need technologies like blockchain. You need to be able to have other people participate in the infrastructure. For example, right now we are starting to onboard the first partners to deploy validator nodes in the network. Participants would be able to set up their own validator node, and they receive revenues based on the volume of transactions that are happening in network. They will also receive a share of the mining. We are starting that, and the goal is to decentralize this whole infrastructure.
Did you think of this economic model yourself, or did you end up in a think tank with others and the pieces all fell together and you put them together?
Initially, it was more like an intuition, then after it was a brainstorm with my team, my co-founder and the early advisors of the company. We looked at like, “That’s the way to do it. What should it look like? How would it work?” Even if now, we have a precise idea and it’s working, it’s no more like a vision, we executed it and it’s working. We have paying customers who use the network. It’s still evolving. The base of the model is there, it’s working, but we know that it will need improvement to become more and more optimal. It’s not something that is set in stone.
I have worked on an economic model myself. I made up one, and it’s called Proof of Scale. I’ve done a couple of episodes that have discussed it in the past, but I will send you an article. I would love to discuss with you how you’re evolving your economic model, because mine also is devised to drive the price of things down by capping the profit margins within a certain tiered system. It’s a similar way that people will lock up part of their coin. This is a way to potentially with any company that can drive the prices down to nearly zero, making this model the most effective one at scale only. Once you have scale and users, you can put it to work. I look forward to seeing what you’re going to do with your economic model, and I’ll throw in some information for you after this is over.
Thank you. I am excited to read about it.
Not many people in the world right now are geeking out on economic models. It’s like, “I love you. I read The Economist and I make economic models.” It’s not like something you want to bring up on a first date or with anybody who’s just met you. Not even over Thanksgiving dinner, my relatives have no patience for this, but it’s nice to meet another nerd like you.
The beauty is when you manage to create such thing, you can change a whole industry and the dynamic. In our case, we believe it can be a way to provide almost free connectivity for people. That’s a vision my co-founder and I had for a long time and have been working in many attempts at it. We believe now we apply it to IoT devices using the Bluetooth low energy wireless interface. We are actively working to apply it to 5G millimeter wave-based stations, where potentially, instead of having the Telcos in this thing and infrastructure, it would be people and enterprise investing in the base station. In return, they would use this protocol on their base station and generate revenue. In that way, you can imagine that at some point, potentially access for people would be free and only business application or IoT device would be paying for accessing the connectivity.
It’s about time we unburden the actual user, because when you look at every economic model up, the engine that creates all of this value, the people at the bottom are doing constantly and capturing little of that return. It’s nice to now see entry points being created. You’re making a huge dent in that. Did you study Economics to get into this? How did you foray into this nerdy approach to economic models?
I was a nerd. I was coding when I was a kid. I started coding when I was eight. I was not good enough in Mathematics to push too much into an Engineering career, so I chose Economics. Most of the things, I learned it by doing things.
Most entrepreneurs that is the case, we learned by doing. As long as we’re active in it, we usually pick it up along the way, otherwise, what’s the point of book smarts if it’s just theoretical? Did you end up getting an advanced degree or did you get your Bachelor’s and then head off into the world of business?
I got an MBA, and then I started building companies early.
Coding at eight, MBA and then building companies, was that the process?
I wish it was that. It was a long painful process, but these are all of learning with many mistakes, many failures.
How many companies now have you founded?
I’m not going to count the one that didn’t last long.
You should count the failures too. It’s only honest.
I founded more than ten companies.
This is your 11th-plus company, so it better stick. For a user out there, someone who is interested in what Nodle is doing and they wanted to get involved, I’ve downloaded the Cash App myself, it didn’t tell me a whole lot about the company. How could somebody, aside from downloading the Nodle Cash Application, how would somebody learn more and do their homework on what Nodle is?
They can go to the website, Nodle.io. They can read the Whitepaper, that explains the vision and what we are building. They can download the Nodle Cash App to start participating and earning the cash. If they are a developer, they will be able to also develop their own application on the network and enable enterprise and developers to use this application. They will be part of the ecosystem and will be also generating revenues for that.
The next thing they can do is download the app and check that out, learn about this. What is coming up on the forefront for you? What’s coming up in the future? I know I’ve heard a lot of buzz around major developments, but what are you doing right now?
We are focusing on building the community worldwide. Building a lot of groups of people who love what we are doing and who want to participate. Also, we were starting a private sale for the token and we want, in the future, grow the community of users by a lot. Our focus is to grow the network with people who have the app, use the network, participate in the network. It’s about growing the network, how focused we are is solely on that.
When people earn this cash, do you have plans to be listed on an exchange or is there a value to it? I’m not sure. What does one Nodle cash equal? How does it translate?
We ask people, the early adopters, we had a group of early adopters because we were pre-installed on the first blockchain phone from HTC, the Exodus. We did a survey and we asked people what value they would assign to a Nodle cash to get there. Some people were saying, “$1 to $5.” Some people were saying, “It should be a $10 to $15.” It was interesting to understand. You have to get a sense because you want to bring utility, but you also want to maintain this community of active people.
It begs the statement that Steve Jobs made a long time ago, which was, “I don’t go to focus groups. I know what they need. They don’t know what they need. I’m not going to ask them what they need. I’m going to give it to them because I know them.” It was a dictatorial process. In the end, did you take their feedback? Did you go with the prices that they said, or did it make you realize there was a high-perceived value and that was positive in and of itself?
We did that to understand the perception. By getting these numbers, we realized that they were much valuing their participation, and that they would put a price on that also, which was interesting to know. It also showed the quality of the app. Even if it’s still early, also we realized it’s something that is generating real value, not only for manufacturers or smart cities or enterprises who want to benefit from accessing that network, but also for the participants, the people who need to install that app on their phone and the enjoy this network. It was a great way to understand better what’s happening.
What did the price fall on? Have you fallen on what the price is yet or is it too early to know?
We have an idea. People will decide in the ecosystem, and we will see what will happen when the ecosystem is more open, then they can exchange that token.
It’s too far down the line to know what you would list out if you were to list it on an exchange yet.
There are a lot of elements that need to happen to confirm that with certainty, even if we know it’s going to happen. What we want first is to show that people with that will have access to services that they can purchase. We are preparing to enable people to spend the Nodle Cash, and focusing on the type of service that they would be able to access fully in the app. Not only monetizing this ecosystem and its work with enterprises who want to use it and leverage your network, but also monetizing the ecosystem for people who are already participating. Give them the possibility to spend that Nodle cash for services for themselves.
It’s going to be cool to see this happen. I’m looking forward to not only earning more Nodle cash, but spending it and finding out what I can get for it. Sweatcoin, I’ve been using that thing for so long, I don’t even know what I could go buy. I forgot about it. I turned it on a long time ago and forgot about it. How many apps can I run and start generating money as I walk around? It’s going to be great.
We want to assure that it gives you access to tangible things, and we want people to be on it. We want people to participate more, see how they can spend a little cash. This is going to happen this year 2021.
What does your public sale look like? Do you have time for when that’s going to begin?
It’s a lot of regulatory things to go through that will enable us to confirm that there’s going to be a public sale. When we do it, most probably that will indicate also that the token should be also exchanged more freely.
I know those regulatory hurdles after being deep in blockchain, I went and got my securities licenses. I do Regulation Ds and different regulated sales. I know what you’re in for.
We’ve got the basic steps, so far it’s going well. The goal is to have a currency, which is compared to a telecom credits, because we are talking about networks and communications, we want this to enable people to buy any service related to communications.
I hope that it expands beyond that. Hopefully you can become the Nodle-enabled Amazon rival.
We are convinced that the Nodle network is going to power many of large enterprise services.
I cannot wait to see that happening.
We are working on that. The two main services to talk about the enterprise part and finish on that is what we call the Smart API that enable any enterprise to locate things which can be packages, shipping pallets or collect data from sensors. We are already working with large organizations. The second one is a service we built to fight the pandemic. We created in partnership with Avnet, a small device that helps employees to social distance and record their interactions at work. If someone gets infected with COVID, you can avoid to have an outbreak and test the right people. We will announce the first customer who is a large international organization, that’s going to be in the month of April this 2021. We have these two main services which is a pipeline of almost $250 million revenues for the network.
You are growing quickly.
We are doing a blockchain, building the largest wireless network out there, but we are also providing real services and real revenue for the ecosystem.
That’s not a small undertaking whatsoever.
This flying wheel that’s going on is that we want people who participate not only to generate revenues by creating the coin, but they will also be able to receive a share of the revenues from the services on top of the network. Even if there is a fine amount of tokens, and we think it’s going to take ten years to mine on these tokens, people will keep on receiving revenues because they are part of the infrastructure that enable these services to work. They will keep on receiving a share of any service that a developer or an enterprise is building on the network. It’s how we create this sustainable ecosystem. That way, it can go on forever.
You’re truly building one of the most necessary things. I hope that as more projects that are using DLT come up, they end up being on the Nodle network so they can add and be added to this ecosystem rather than trying to be competitive. It doesn’t make sense. You guys have a lot of open doors for people to participate on all levels, enterprise, all the way to user. It’s fantastic.
To come back to your original point, we believe that IoT and the number of things that’s going to be connected is not in tens of billions, but more in hundreds of billions and trillions of things. What we are building is a network to enable to take data in and out of hundreds of billions of things, and leverage this ocean of awareness to face some of the biggest civilization’s challenges. We believe that’s why connectivity is so necessary. We do that by also looking at how we protect privacy, because it’s an important thing and point when it comes to connectivity, and especially when you start to look at things, so we are focused on how we protect the privacy of everyone and how we secure these communications. One of the big companies we work with, and we’re also working on leveraging infrastructure to secure communications from these objects or tiny sensors, and be able also to authenticate them using the whole infrastructure. Privacy and security in addition to bringing connectivity are the things we want to focus also as a team.
There are many components to the Nodle ecosystem. I can’t wait until you have more of this up on your website as well, because diving into the Whitepaper is for nerds. I hope the more non-nerds get to know what you are doing.
Hopefully, we will do a better job at explaining what we do on the website.
Your website is fantastic. There are many new things that you’re also working on that I would never have known, and you heard it here first basically, which I’m glad about. I look forward to seeing how you develop, especially after you are going to announce your public sale, or if you get further down this path. If you ever want to come back, I would love to do a follow-up interview with you, see how things have developed, especially with such a multi-faceted ecosystem as Nodle. I appreciate you taking the time to come on. Thank you so much.
Thank you, Monika. It’s great to explain and to get more people aware of what we do and build. We would love to be back when we announce the public sale.
Do you have any parting words that you want to give the average user? Do you have anything else that you’d like to add before we take off here?
I can share a bit of my experience as an entrepreneur. 2020 was challenging for everyone. It certainly was more challenging for early-stage entrepreneur. I had pushed the envelope many times in my life as an entrepreneur, never as much as 2020, we could have died so many times. I want to share that message because I know there are many entrepreneurs out there, many young people who want to build things. I have two main recommendations that I’d like to share about my experience. I’ve done mistakes more than once and repeated them. Hopefully, I’ve learned from them. Often, I realized that I needed to repeat them several times to learn from them. First is never give up. I’m not saying it’s enough. It’s important especially when you believe in you and you believe in your vision and what you are building, and you want to realize your dream. Never give up. Second is life is so much full of surprise. I came up with that sentence many years ago, “Victory is in the unknown.” For that, you need to be able to face your fears.
The fact that you’ve made it through 2020 with an early-stage startup, you’ve pretty much slayed. I hope, knock on wood, you slain the greatest dragon along the way. You go out and slain the dragon, you return to the village. Hopefully, you returning to the village is the end of the story here. Thank you so much. “Victory is in the unknown,” is an excellent quote to be using in this. Thank you. I look forward to speaking with you again in the future. Micha Benoliel, thank you so much for joining us. I appreciate you taking the time. I wish you all the best with your private sale and your amazing ecosystem that you’re building.
Thank you, Monika.
This is Monika Proffitt, signing off. I’ll catch you on the next episode. Thank you so much.
Important Links
About Micha Benoliel
At age 8, Micha taught himself how to code on a flight simulator in Basic on a Zenith PC that his father was using for accounting purposes. Subsequently, he wrote his first games on a Texas Instrument TI 99 4A, ATARI 512ST and Amiga 500.
Micha has been a pioneer in VoIP and launched several telecommunications services in the past decade. He enabled Skype to start SkypeIn and SkypeOut, the innovation that scaled up its monetization and other premium Skype services.
In 2011, Micha co-founded Open Garden to build a new generation of mobile network leveraging the smartphone infrastructure. Open Garden is the creator of FireChat, the first off-the-grid messaging app, leveraging peer-to-peer mesh networking.