These five Houston startups are linking up industries and blockchain technology. Getty Images

Blockchain has really started to come into its own as more and more companies are applying the technology across industries — from oil and gas analytics and fundraising to even social media marketing.

Five Houston companies have made their mark on these different industries by incorporating this burgeoning technology.

Data Gumbo

Andrew Bruce had the idea for Data Gumbo when he realized how difficult it was to share data in upstream oil and gas. Courtesy of Data Gumbo

As the blockchain-as-a-service company's name suggests, Houston-based Data Gumbo is all about the data.

"The whole idea is to build out the blockchain network, and provide a network that they can subscribe to and start doing business on that network," Andrew Bruce, CEO of Data Gumbo, says. "It's a service, so there's a subscription fee. It gives them access to the savings they already have available within their organizations."

The company, which focuses on providing midstream and upstream oil and gas companies with timely decision-making information, was launched in 2016 and faced a big learning curve in the industry.

"We got a lot of questions and concerns about what blockchain is, why they need it, and whether or not they can trust it," Bruce says. "We were introducing a completely new concept to a conservative industry."

The industry is coming around as Data Gumbo grows its network and proves results.

Social Chains

Big companies are using your data to make a profit — but what if you got a kickback of that cash? That's what Houston-based Social Chains is trying to do. Pexels

When it comes to social media marketing, Houston-based Social Chains is putting the power back into the hands of users. Big social media companies, like Facebook, sell data about you to marketers and advertisers, and there's nothing you can do about it. Social Chains is a new platform where users own their own data and receive a cut of the payment.

"On our platform, the user is a stakeholder. Our platform distributes 50 percent of the profits to the users," Srini Katta, founder and CEO of the company, says.

Social Chains already has 5,000 users and, Katta says, that's with little to no marketing efforts. Currently, he's been working out a few kinks before launching into marketing for the platform, though he expects to do that beginning next month. Most of Social Chain's current users are high school to college students, so that will be the primary demographic for the marketing strategy.

Topl

Houston-based Topl can track almost anything using its blockchain technology. Courtesy of Topl

Blockchain, when applied to consumer products, can be used to complete the full picture of that product. A chocolate bar, for instance, can be traced from cacao farm to grocery store. Not only does the connected information keep each party accountable when it comes to prices, it tells a story.

"We are a generation that wants a story," says Kim Raath, CFO of Topl. "We want an origin, and don't want to be fooled. And, because you might be able to reduce the cost by having this transparency, you might be able to bring down the cost on both sides."

Topl, a Houston-based startup that was created by a few Rice University graduate and doctorate students, uses blockchain to connect the dots. One of the ways Topl's technology is being used is to track money. If an investor gives to a fund, and the fund gives to a startup, there's nothing to connect that first investor to the startup's success or to measure its impact. This is a tool used by investors or donors alike. For instance, if you were to create a scholarship, you can use Topl to track what student received that money and if they are meeting the required metrics for success.

Topl's 2019 focus is on growing its network and what it's able to provide its clients, like an app factory for companies trying to track specific things.

Iownit.us

The stock market has been using tech for years — why shouldn't the private sector have the same convenience? Getty Images

To Rashad Kurbanov, the private investment world was extremely backwards. While the stock market had been digitizing investment for years, private funds had a drawn out process of emails and meetings before moves were made. He thought introducing technology into the process could help simplify the investing for both sides of the equation.

"What we do, and where technology helps us, is we can take the entire process of receiving interest from investors, signing the transactions, issuing the subscription agreements, and processing the payments and put that all online," says Kurbanov, CEO and co-founder of Houston-based iownit.us.

The company is still seeking regulatory approval, but once that happens, the technology and platform will be ready to launch. The platform is a digital site that connects investors to companies seeking money. The investors can review the companies and contribute all online while being encrypted and protected by blockchain.

Houston Blockchain Alliance

blockchain

Here are some of the most common, misunderstood aspects about blockchain technology. Getty Images

The Houston Blockchain Alliance is a newly formed networking group for anyone working within or interested in the blockchain industry. Mahesh Sashital, co-founder of Smarterum, a blockchain news site, founded the organization late last year after realizing Houston was in need of an informative networking group.

"I thought that I'd start the Houston Blockchain Alliance so that someone like me, who's already in the industry, can find other people working in the industry," he says. "And for other people interested in blockchain can learn more and get up to speed with the technology."

The alliance aims to host regular events — its launch event is Feb. 20 — and educate people on blockchain. Click here to read Sashital's guest column about common blockchain misunderstandings.


Here are some of the most common, misunderstood aspects about blockchain technology. Getty Images

Fact or fiction? Houston blockchain expert addresses common misconceptions

Myth busting

Blockchain has become one of the most talked about emerging technologies, often mentioned in the same breath as artificial intelligence, virtual reality, Internet of Things, and big data technologies. But as a relatively new technology, it's totally expected that people will not fully comprehend aspects of the technology.

Here are some of the most common, misunderstood aspects about blockchain technology.

1. Blockchain is the same as Bitcoin (and other cryptocurrencies)

Source of misconception: The first and probably the most common misconception about blockchain is that it is the same as Bitcoin or cryptocurrency in general — and it is not hard to spot where this comes from. Blockchain as a technology became popular almost a decade after the release of the Bitcoin whitepaper. It is very common for people to refer to it as the technology that powers Bitcoin, and while this is totally correct, people forget one important fact — blockchain does a lot more than just enabling Bitcoin and other cryptocurrencies.

The truth about blockchain: A blockchain is basically a decentralized ledger of transactions. It follows therefore that a Bitcoin blockchain will record Bitcoin transactions. However, blockchain can record virtually anything of value, not just cryptocurrency transactions, provided that the data can be represented on the chain. For instance, J.P. Morgan announced last year that it was tokenizing Gold bars via its enterprise blockchain known as Quorum. Blockchain has found applications in healthcare, supply chain, oil and gas, in addition to finance.

2. Cryptocurrencies (and by association blockchain) are used for illegal activities

Source of misconception: Cryptocurrency has a reputation (earned or otherwise) of being closely associated with crimes like ransomware attacks, money laundering, drug trafficking, and dark web activities. This is because cryptocurrency transactions are relatively harder to track, and criminals have used cryptocurrency in the past to perpetuate these activities. This has been blown out of proportion by law enforcement agencies and notable figures like Bill Gates and Jamie Dimon.

The truth about blockchain: Truth is, regular fiat currencies (the US dollar and Euro specifically), and not Bitcoin or other cryptocurrencies, remain the main medium of sponsoring criminal activities. A Europol report last year confirmed that Bitcoin and other crypto were not used to sponsor terrorism in the region, contrary to widely held opinions. Furthermore, the ratio of illegal to legal activity in Bitcoin has dropped since it became more popular and widely used. Special agent Lilita Infante at the U.S. Drug Enforcement Administration estimates a drop from 90 percent to 10 percent in the last five years. Actually, banks and other legitimate institutions are adopting blockchain technology for cross-border payment settlements.

3. Blockchain transactions are anonymous

Source of misconception: Again, this comes from a widely held belief that blockchain (actually cryptocurrency) is unregulated. It has been positioned as the antithesis of data-collating centralized systems, and therefore has to be anonymous.

The truth about blockchain: On the contrary, blockchain — especially public blockchains — are open and transparent ledgers that show transactions between different addresses. It's fairly easy to track transactions on a public blockchain using block explorers like Etherscan. Also, KYC requirements at many crypto exchanges make it possible to associate these address with real people. That said, there are privacy-focused blockchains like Z-Cash and Monero which use special cryptographic techniques to shield certain details of transactions.

4. Blockchain will solve all the world’s problems

Source of misconception: Hype. As blockchain technology gained in popularity, so came individuals seeking to apply it to every sector of human endeavor. Likening it to the internet, they created an impression that blockchain can and will address pain points in businesses across all industries. As impressive as it is, blockchain, like every technology before it, has its applications and its limitations.

The truth about blockchain: The extent of blockchain's impact has not yet been fully exploited but it will be preposterous to say that blockchain will solve all the world's woes. Through decentralization, blockchain provides trust, and security thereby removing the need for third parties; this is where its realistic use cases arise. At the moment, issues like scalability need to be addressed for blockchain to become commercially viable.

5. Blockchain applications will work all by themselves, independent of existing technology

Source of misconception: Hype again. On the backs of No. 4, blockchain is sometimes looked at as a standalone, independent technology. Given the hype surrounding blockchain, folks could be forgiven for thinking that the technology will work all by itself, without having to deal with legacy applications and technologies.

The truth about blockchain: Blockchain applications most often must work side by side with other existing technologies and systems, as well as in some cases, with emerging technologies like IoT, AI and others. In the financial sector, for instance, blockchain is incorporated into existing payment systems to facilitate cross-border payment settlements.

6. Blockchain only has application in finance

Source of misconception: This stems from the misconception that blockchain is all about Bitcoin or a new order of currency that will replace fiat.

The truth about blockchain: The fintech sector, more than any other, has adopted blockchain technology since its early days. That said, blockchain applications are spreading across various industries. In addition to the ones mentioned previously, projects like MedRec, PowerLedger, and Vakt are adopting blockchain in healthcare, energy, and the oil and gas industries, respectively.

7. Blockchain is the same as Cloud

Source of misconception: Both are internet-based technologies and involves access to data from different devices, but that's as similar as they get. Cloud service providers like Amazon are introducing enterprise blockchain solutions to cloud-based services.

The truth about blockchain: As a shared ledger, blockchain data is not stored on a central set of servers as is the case with cloud services. Also unlike cloud storage, blockchain doesn't usually hold actual physical information like pdf files rather it makes a record of its existence.

8. Blockchain is a single technology

Source of misconception: This comes from the likening of blockchain to the internet. As there is one internet, some people erroneously believe that there is a single blockchain.

The truth about blockchain: There are several blockchain networks — both private and public. While Bitcoin blockchain is the biggest blockchain, there are other public blockchains like Ethereum and Litecoin as well as private blockchains based on Hyperledger.

While these misconceptions are still prevalent within and outside the blockchain community, efforts are underway to dispel these myths. Education and an open dialog is key in such cases. Those within the blockchain community need to make a concerted effort to truly listen to what those outside are saying. Solution providers also need to understand the business, its issues and pain points, and propose the correct solution, whether blockchain-based or not. Blockchain technology is still in its infancy. Remember when folks did not know what the internet was or when it was nothing but hype? In 20 years or so, we will have a few such stories to laugh at.

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Mahesh Sashital is the founder and chairman of the Houston Blockchain Alliance.

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Rice University's edtech company receives $90M to lead NSF research hub

major collaboration

An educational technology company based out of Rice University has received $90 million to create and lead a research and development hub for inclusive learning and education research. It's the largest research award in the history of the university.

OpenStax received the grant funding from the U.S. National Science Foundation for a five-year project create the R&D hub called SafeInsights, which "will enable extensive, long-term research on the predictors of effective learning while protecting student privacy," reads a news release from Rice. It's the NSF's largest single investment commitment to national sale education R&D infrastructure.

“We are thrilled to announce an investment of $90 million in SafeInsights, marking a significant step forward in our commitment to advancing scientific research in STEM education,” NSF Director Sethuraman Panchanathan says in the release. “There is an urgent need for research-informed strategies capable of transforming educational systems, empowering our nation’s workforce and propelling discoveries in the science of learning.

"By investing in cutting-edge infrastructure and fostering collaboration among researchers and educators, we are paving the way for transformative discoveries and equitable opportunities for learners across the nation.”

SafeInsights is funded through NSF’s Mid-scale Research Infrastructure-2 (Mid-scale RI-2) program and will act as a central hub for 80 partners and collaborating institutions.

“SafeInsights represents a pivotal moment for Rice University and a testament to our nation’s commitment to educational research,” Rice President Reginald DesRoches adds. “It will accelerate student learning through studies that result in more innovative, evidence-based tools and practices.”

Richard Baraniuk, who founded OpenStax and is a Rice professor, will lead SafeInsights. He says he hopes the initiative will allow progress to be made for students learning in various contexts.

“Learning is complex," Baraniuk says in the release. "Research can tackle this complexity and help get the right tools into the hands of educators and students, but to do so, we need reliable information on how students learn. Just as progress in health care research sparked stunning advances in personalized medicine, we need similar precision in education to support all students, particularly those from underrepresented and low-income backgrounds.”

OpenStax awarded $90M to lead NSF research hub for transformational learning and education researchwww.youtube.com

2 Houston startups selected by US military for geothermal projects

hot new recruits

Two clean energy companies in Houston have been recruited for geothermal projects at U.S. military installations.

Fervo Energy is exploring the potential for a geothermal energy system at Naval Air Station Fallon in Nevada.

Meanwhile, Sage Geosystems is working on an exploratory geothermal project for the Army’s Fort Bliss post in Texas. The Bliss project is the third U.S. Department of Defense geothermal initiative in the Lone Star State.

“Energy resilience for the U.S. military is essential in an increasingly digital and electric world, and we are pleased to help the U.S. Army and [the Defense Innovation Unit] to support energy resilience at Fort Bliss,” Cindy Taff, CEO of Sage, says in a news release.

A spokeswoman for Fervo declined to comment.

Andy Sabin, director of the Navy’s Geothermal Program Office, says in a military news release that previous geothermal exploration efforts indicate the Fallon facility “is ideally suited for enhanced geothermal systems to be deployed onsite.”

As for the Fort Bliss project, Michael Jones, a project director in the Army Office of Energy Initiatives, says it’ll combine geothermal technology with innovations from the oil and gas sector.

“This initiative adds to the momentum of Texas as a leader in the ‘geothermal anywhere’ revolution, leveraging the robust oil and gas industry profile in the state,” says Ken Wisian, associate director of the Environmental Division at the U.S. Bureau of Economic Geology.

The Department of Defense kicked off its geothermal initiative in September 2023. Specifically, the Army, Navy, and Defense Innovation Unit launched four exploratory geothermal projects at three U.S. military installations.

One of the three installations is the Air Force’s Joint Base San Antonio. Canada-based geothermal company Eavor is leading the San Antonio project.

Another geothermal company, Atlanta-based Teverra, was tapped for an exploratory geothermal project at the Army’s Fort Wainwright in Alaska. Teverra maintains an office in Houston.

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This article originally ran on EnergyCapital.