Continuum Loop

Why cheqd?

We’ve already told many folks what we are advising cheqd and participating in the cheqd network as a node operator – but we wanted to provide more information for the community (clear disclosure – that means we will, or do – depending on when you are reading this article – hold cheqd tokens).

This article aims to explain areas where we are aligned with cheqd as well as a few areas we will be pushing them towards.


We serve a range of client types (government, military, financial institutions, NGOs, not-for-profits, startups). I’ll deal with them in two distinct groups here as the first group is unique while the others fall into the same broad bucket.


We advise several government agencies and they, right now, aren’t overly interested in token-enabled networks for operational use. However, they do need to understand what things will mean when permissionless ledgers and tokens are “normal” and citizens insist on their use.

1.2 OTHER CLIENTS (Corporations, Financial Institutions, Startups, Investors, Crypto Projects, and Not for Profits/NGOs)

We are advising multiple organizations about the state of decentralization/crypto/web3 space and about the key developments in the space. Many of these organizations are either actively interested in understanding what impact permissionless ledgers and tokens will have on them immediately or over the longer term. Their interest ranges from rabid to tepid to allergic. Some may be partial competitors to cheqd but they are also potential collaborators. It’s an interesting mix.

The reason we advise them is that it is our job at Continuum Loop to keep them apprised about where things are headed (here comes an obligatory Canadian hockey quote from a non-sports fan):

“I skate to where the puck is going to be, not where it has been.”

– Wayne Gretzky


For many of our clients, compliance is a big issue. While many of the #decentralizeTheWorld types would like to think that there is no need for this, the world we live in needs it. So part of our efforts with cheqd is in understanding and advising on how the cheqd network fits with various compliance and audit needs.

Payments aren’t simple. Sure, in crypto it is easy to send funds from one address to another on the same chain. Once you start exchanging between different coins/tokens you add quite a bit of complexity. Adding the KYC/AML needs that you will, as a citizen of a country, require and things get hairy quickly.


We have been talking more and more about what we call “premature interoperability” and “premature standardization”. The gist of these discussions is that there are only a few areas right now where interoperability and standardization make any sense – and neither have definitive good answers. We’ll be supporting cheqd to align with the key initiatives that we see are making a difference, particularly with the Trust Over IP Foundation, Hyperledger with the Aries Interoperability project, and DIF with its interoperability profile efforts. These leading groups are bringing the industry together and I’ll be helping cheqd play a role there.


As a founder (and funder) of the Trust Over IP Foundation, the consideration of governance of any ecosystem is critical. We’ve looked at how cheqd could fit into various different ecosystems that we are helping with and are pleased that it fits nicely. It is focused on the creation of a permissionless network. They are working to ensure that no single party holds too much control. In this case, control could easily kill an ecosystem so that is critical. One of my most important operating principles is pinned on my Twitter profile:

A governance-related area that I will be pushing cheqd and others in the SSI/decentralized identity realm relates to where developers fit into the governance structure. To date, the ecosystems we are working with don’t incentivize developers well, or at all. That’s a deep flaw in my view. We have created back-of-napkin incentive concepts that show our team internally what is feasible with cheqd in the longer term, and from the Continuum Loop side, we’re satisfied that we’re off to a good start.


The use of Verifiable Credentials is part of what we help our clients understand. One big problem is that to date they really only get uptake where they are radically reducing costs, which is a bottom-line impact for companies.

The more interesting use cases from a business perspective are top-line revenue related – how does a business drive massive value for its customers using verifiable credentials? Any business that drives value deserves a portion of that value (while rent-seekers take oversized percentages of value while adding little or nothing, and should rightly be removed from the system).

The problem has been answering the following range of questions:

  • How does a Verifier pay an Issuer;
  • How does a Holder pay an Issuer;
  • How does a Verifier pay a Holder;
  • or any variant of those pairings (or more than 2 parties)?

This is indeed a hard problem, especially when you consider how privacy, security, and compliance are impacted when you introduce payment.

Many of our clients feel there is a way to add value and drive revenue with decentralized identity, but we haven’t had any good answers to date. We believe we are getting much closer to that with cheqd and other projects we are working on.

6. FIAT versus TOKEN

One of the first questions I asked the cheqd team when we started getting into discussions was how they would make life easy for users that want to use, or just stick with, fiat currency for transactions. They will need to provide details for you but I am satisfied that they are taking a good approach to make fiat payments work – especially when it comes to network fee stability.

On the tokenomics side, we aren’t going to get into the science (magic/mythology/voodoo – pick your term) of tokenomics as that is not our area of deep expertise. However, it is worth mentioning a few things that are important to our clients and our team. Governance is an obvious one. Another is ensuring that the non-token world can be abstracted away from the token when required. Another is how cheqd’s approach may enable commercial models that, to date, have been holding back the use of decentralized identity. The team at cheqd has a coherent explanation of how cheqd is handling the tokenomics here.


I have fielded a lot of “but what about Sovrin?” questions. These ones baffle me somewhat, but I get it. I want to be clear, we (Continuum Loop and I) fully support the Sovrin Foundation and its mission. I am an ex officio member of the Sovrin Board of Trustees, by virtue of co-chairing the Identity For All Council, which is hosted at the Sovrin Foundation. I volunteer a lot of time with Sovrin and will continue to do so.

Similar to Continuum Loop’s work with governments that are working on deploying, or have deployed, Hyperledger Indy networks of their own, Sovrin plays a critical role. We don’t believe that there will be one single SSI network but Sovrin is important both as a network, as well as its facilitator/leader role in a network-of-networks. The cheqd network adds to the diversity in the network-of-networks and I imagine that the two groups will work together nicely.

Sovrin is also the progenitor of much of the leading thinking that is in the space – Trust Over IP Foundation; Sovrin Governance; Hyperledger Indy; and more.


We’re looking forward to learning how our relationship with cheqd shakes out. We’re going to be learning alongside them and our clients. I am sure we will make progress and I am sure we will stumble at times. That’s what we do at Continuum Loop.

Our clients are the ones that face an uncut jungle and do one of two things – grab a machete to cut trail (Innovators*) or look for the narrow trails that other adventurous souls have already started to cut (Early Adopters*). Our clients are not looking for paved roads through well-known paths (majority and laggards). By the time those roads are in place the rest of the world is already using them.

* If the Innovator/Early Adopter terms are unfamiliar check the Wikipedia page for Technology Adoption Life Cycle. Keep in mind that most folks that talk about the adoption life cycle usually start with “we need the Early Adopters”, when they likely mean they need the Innovators.

Also published on Medium.

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