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Sirin Labs Announces FINNEY, Plays Phone Tag With HTC




One, two, three, four – I declare a blockchain smartphone war.

Sirin Labs has announced that its crowdfunded blockchain smartphone, the FINNEY, will be released this November. Last year, the company raised $157.8 million in its ICO, and the hype has been growing ever since.

HTC is also releasing a blockchain phone, the Exodus, later this year.

Both phones have hardware wallets, and both Sirin and HTC claim their products will allow easy conversion and trading between coins. Both companies have had their share of economic failures and struggles to stay afloat. Both claim to be some version of "the first" blockchain smartphone.

However, while HTC has yet to release specs for the Exodus, available information suggests the phones will have significant differences. Whereas the Exodus will focus on data privacy, security, and interoperability between blockchains, the FINNEY is focused mostly on cryptocurrency and related security, and operates on its own blockchain – or maybe its own tangle (more on that below).

In an April post on Medium, Sirin Labs described its purpose, target market, and product. It laid out statistics about the low use of cryptocurrency among Americans and the high rate of smartphone ownership. Sirin figured that if it created a crypto-compatible, easy-to-use smartphone, it could spur mainstream adoption of blockchain technology. HTC's Exodus, on the other hand, seems less singularly focused on crypto.

The phone will run on SIRIN OS, an open-source operating system built on top of Android. It is intended to allow P2P cryptocurrency transactions, resource sharing, and easy access to blockchain-based services, and to make "fee-less and quantum-proof transactions of cryptocurrencies (without involvement of SIRIN LABS)." It should be noted, however, that at the time of publication, ETHNews was unable to find the SIRIN OS source code on GitHub or anywhere else. It is unclear whether the Exodus will have a native OS, if it will run on Android, a combination of the two, or something altogether different.

The fact that FINNEY has its own blockchain seems to be its most notable contrast to the Exodus, but few details have been released about the specifics of the Sirin Labs blockchain, other than what was stated in the white paper and on the company's website. Both raise more questions than they answer. For one, it is unclear if FINNEY operates a blockchain at all. The website states:

"FINNEY™ devices form an independent blockchain network, a distributed ledger both scalable and lightweight, powered by a fee-less DLC and SIRIN LABS' security ecosystem. FINNEY™ is free from centralized backbones and mining centers, capable of providing fast, fee-less and secure transactions."

But the white paper goes on to state that no existing blockchain was suitable for its purposes because the phone would require "fast transaction confirmation … extremely low transaction costs to enable micropayments, and … light clients capable of operating nodes on devices with entry-level CPU and limited network connectivity." It also added that validations should be done through proof-of-work on users' devices.

It seems that the company found a solution to blockchain technology's supposed shortcomings via IOTA's Tangle. The white paper states:


The IOTA Tangle is not a blockchain. The technologies are similar, but they are not the same thing. The white paper seems to suggest that Sirin Labs was seeking to combine the two technologies somehow, but it does not elaborate. However, the lack of mining combined with the presence of proof-of-work and light client protocols sound a lot more like IOTA's Tangle than any blockchain.

A tangle is a theoretical concept which stands apart from IOTA's iteration of it. In a somewhat confusing move, IOTA's white paper describes the theoretical concept rather than the company's actual product. A tangle is a blockless distributed ledger system. But whereas in a blockchain the actors making transactions and those validating transactions are generally separate entities, in a tangle every transacting party also validates the transactions of others. The network does not come to a consensus about every single transaction, nor does every node in the network store the transaction history. It is still secured by cryptography, it enables P2P transactions, and it is still, at least theoretically, a decentralized network.

It can be argued that a tangle is more scalable because no one device stores an entire transaction history, or validates the transactions, and the proof-of-work mechanism is easier to solve. This makes it possible for devices without a lot of processing or storage capacity, like smartphones, to act as nodes in a tangle.

IOTA's version of the tangle, called "the Tangle," is just one practical implementation of the concept, and it is one that has faced heavy criticism from developers, academics, and the public more generally. The concerns center around IOTA's centralization and its proof-of-work validation mechanism, which Ethereum core developer Nick Johnson said showed a "lack of good technical judgement."

It seems like FINNEY's focus on crypto might be self-serving. Sirin Labs' native token, the SRN, will be used to purchase and use Sirin Labs products and services, including apps allowing for encrypted calls and messages. In its white paper, the company laid out the distribution for token issuance.


It seems significant that 45 percent of the tokens were allocated to Sirin Labs and "the team," but the tokens do not hold any voting power, so that should not by itself lead to centralization. 

There is a lack of clarity surrounding both blockchain phone products. It is unclear if FINNEY can even truly call itself a blockchain phone and it's unclear to what extent it is truly secure or decentralized. On the other hand, the Exodus seems to allow more freedom for users to choose the blockchain of their choice, potentially allowing them to customize their security preferences – but we know even less about the Exodus' specs than FINNEY.

One thing is clear, however: Blockchain is making its way to your smartphone, eventually. 

Alison Berreman

Alison has a master’s in English from the University of Wyoming. She lives with her pooch in Reno. Her favorite things to do include binge listening to podcasts, getting her chuckles via dog memes, and spending as much time outside as possible.

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